The Federal Reserve is giving stakeholders more time to comment on new risk-capital requirements rules

From: RegTech Analyst

A new framework for risk-based capital is in the works in the US. Now, FinTech companies have until January 22 to make their views heard.

People interested in commenting on the new regulations had until December 23 to do so, but the Federal Reserve Board has now decided to extend the comment period.

The Federal Reserve Board originally posted its proposal about the new rules in October, 2019.

The proposals include creating a risk-based capital framework, termed the Building Block Approach.

This new framework would adjust and aggregate existing legal entity capital requirements to determine an enterprise-wide capital requirement, together with a risk-based capital requirement excluding insurance activities.

It would also put up a limit, or a buffer, for how insurance depository institution holding company’s capital distributions and discretionary bonus payments are made. Essentially, they won’t be able to make them unless they have sufficient capital relative to enterprise-wide risk.

The Federal Reserve Board also proposes to revise reporting requirements for depository institution holding companies significantly engaged in insurance activities.

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