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Course description

In September 2019, the FDIC adopted two substantive rules and one technical rule related to regulatory capital. The rules simplify capital calculations & capital requirements for certain community banking organizations. 

Under the Economic Growth, Regulatory Relief and Consumer Protection Act, the FDIC was required to introduce an optional simplified measure of capital adequacy. Qualifying banks are eligible to opt into this measure, which is known as the Community Bank Leverage Ratio (CBLR) Framework. The appeal of opting-into the CBLR Framework is that banks will not be required to report or calculate risk-based capital. 

Using the FDIC's forthcoming compliance guide, this session will enable your bank to use the CBLR framework for your September 30, 2020, Call Report. 

The FDIC also published a rule that enables non-advanced approaches banking organizations to measure their tier 1 capital using the simpler regulatory capital requirements for mortgage-servicing assets, certain deferred tax assets arising from temporary differences, investments in the capital of unconsolidated financial institutions, and minority interest. As of January 1, 2020, banks have been permitted to use this new measure for tier 1 capital under the CBLR framework. 

Finally, the FDIC also issued a technical rule that incorporates the CBLR framework into the deposit insurance assessment system. During this webinar, you will learn how this change is beneficial to your bank. 

In this webinar, you will discover how to opt into and out of the CBLR Framework. You will be able to determine whether your bank qualifies to use the Framework; and, you will be educated about the benefits and risks associated with it opting into it. We will examine the regulatory requirements for tier 1 capital, and evaluate the merits of using this new measure.  

We will also examine the effects the pandemic has had on call report deadlines and whether you can expect a grace period for submitting the final call reports of 2020. Likewise, we will discuss the impact of Congress’s CARES Act on the CBLR Framework, and review the temporary changes that were made to ensure the Framework complied with Section 4012 of the CARES Act. 

After attending this session, you will be prepared to determine whether your bank should (1) opt-in to the CBLR Framework before completing your next Call Report, and (2) use the new measure for tier 1 capital in 2020 and beyond. 

Covered Topics

  • Call Reports 101
  • CBLR Framework
  1. The Economic Growth, Regulatory Relief and Consumer Protection Act, s. 201
    • Who is a Qualifying Community Banking Organization?
    • Benefits of Opting In
    • Grace Period 
  • New Rule for Tier 1 Capital 
    • What is Tier 1 Capital?
    • What are the simpler regulatory capital requirements
    • Calculation of the Leverage Ratio
    • Leverage Ratio Requirements
  • New Technical Rule
    • Assessment Rate Calculation
  • COVID-19 Impact on 2020 Call Report 
    • Grace Period & Due Dates
    • CARES Act & Temporary Changes to the Framework
  • Handouts
    • Federal Agencies’ October 2019 CBLR Framework Compliance Guide 
    • FDIC Fact Sheet on Community Bank Leverage Ratio (CBLR) Framework

 

Instructor(s)

Carly Souther

Carly Souther is General Counsel and COO at iTrain OnDemand (iTod), where she provides guidance on legal and compliance issues for clients in the U.S. financial industry. She formerly served as Chief of Regulation at ECigIntelligence and was the Assistant General Counsel at Florida's Agency for Health Care Administration. Carly has published on a wide range of issues in both legal and medical journals, including the Georgetown Journal on Poverty Law & Policy and the University of Iowa's Transnational Law & Contemporary Problems. She is a member of the Florida Bar, and holds an M.A. from the Universitat Autònoma de Barcelona; a J.D. from the Florida State University College of Law; and a B.A. from Mercer University.

Course curriculum

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    Webinar

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