§ 217.400 - Purpose and applicability.

§ 217.400 Purpose and applicability.

Cross Reference

Link to an amendment published at 84 FR 59075, Nov. 1, 2019.

(a) Purpose. This subpart implements provisions of section 165 of the Dodd-Frank Act (12 U.S.C. 5365), by establishing a risk-based capital surcharge for global systemically important bank holding companies.

(b) Applicability -

(1) General. This subpart applies to a bank holding company that is :

(i) Is an advanced approaches Board-regulated institution

and that is

or a Category III Board-regulated institution;

(ii) Is not a consolidated subsidiary of a bank holding company

or

; and

(iii) Is not a consolidated subsidiary of a foreign banking organization.

(2) Effective date of calculation and surcharge requirements. Subject to the transition provisions in paragraph

(i) A bank holding company identified in § 217.400(b)(

3) of this section:

(i) A bank holding company that becomes an advanced approaches Board-regulated institution 1) is subject to § 217.402 of this part and must determine whether it qualifies as a global systemically important BHC pursuant to § 217.402 by December 31 of the year immediately following the year in which the bank holding company becomes an advanced approaches Board-regulated institution or a Category III Board-regulated institution; and

(ii) A bank holding company that becomes a global systemically important BHC pursuant to § 217.402 must calculate its GSIB surcharge pursuant to § 217.403 by December 31 of the year in which the bank holding company is identified as a global systemically important BHC and must use that GSIB surcharge for purposes of determining its maximum payout ratio under Table 1 to § 217.11 beginning on January 1 of the year that is immediately following the full calendar year after it is identified as a global systemically important BHC.

(

3) Transition provisions for the calculation and surcharge requirements -

(i) GSIB surcharge requirements for bank holding companies with more than $700 billion in total assets or $10 trillion in assets under custody. A bank holding company that is an advanced approaches Board-regulated institution with more than $700 billion in total assets as reported on the FR Y-9C as of December 31, 2014, or more than $10 trillion in assets under custody as reported on the FR Y-15 as of December 31, 2014, must calculate its GSIB surcharge by December 31, 2015, and use that GSIB surcharge to determine its maximum payout ratio under Table 1 to § 217.11 beginning on January 1, 2016; provided that for the GSIB surcharges required to be calculated by December 31, 2015 and by December 31, 2016, the bank holding company must calculate its short-term wholesale funding score using the average of its weighted short-term wholesale funding amounts (defined in § 217.406(b)), calculated for July 31, 2015, August 24, 2015, and September 30, 2015.

(ii) Calculation and GSIB surcharge requirements for other advanced approaches Board-regulated institutions. A bank holding company that was an advanced approaches Board-regulated institution as of December 31, 2014, and is not described in paragraph (b)(3)(i) of this section must:

(A) Determine whether it qualifies as a global systemically important BHC pursuant to § 217.402 by December 31, 2015; and

(B) To the extent it qualifies as a global systemically important BHC by December 31, 2015, calculate its GSIB surcharge by December 31, 2016. The GSIB surcharge calculated by December 31, 2016, shall equal the method 1 surcharge (defined in § 217.403) of the bank holding company.

(c) Reservation of authority.

(1) The Board may apply this subpart to any Board-regulated institution, in whole or in part, by order of the Board based on the institution's capital structure, size, level of complexity, risk profile, scope of operations, or financial condition.

(2) The Board may adjust the amount of the GSIB surcharge applicable to a global systemically important BHC, or extend or accelerate any compliance date of this subpart, if the Board determines that the adjustment, extension, or acceleration is appropriate in light of the capital structure, size, complexity, risk profile, and scope of operations of the global systemically important BHC. In increasing the size of the GSIB surcharge for a global systemically important BHC, the Board shall follow the notice and response procedures in 12 CFR part 263, subpart E.

[Reg. Q, 80 FR 49105, Aug. 14, 2015, as amended at 84 FR 59075, Nov. 1, 2019]