Forum, BPI Submit Comments on Two FSB Discussion Papers on Derivatives and Resolution Planning
August 2, 2019
The Financial Services Forum and Bank Policy Institute submitted comments on two Financial Stability Board (FSB) discussion papers regarding 1) the solvent wind-down of derivatives and trading portfolios, and 2) public disclosures on resolution planning and resolvability.
Comment Letter: Forum Provides Observations and Recommendations to FSB's Evaluation of “Too-Big-to-Fail” Reforms
June 28, 2019
The Forum sent a comment letter in response to a request for stakeholder feedback from the Financial Stability Board (FSB), which is currently evaluating the effects of reforms that were agreed by the G-20 following the global financial crisis.
The Forum wrote that the post-crisis regulatory reforms implemented to address too-big-to-fail in the United States have been successful in addressing systemic and moral hazard risks and policymakers should continue to work to improve efficiency, promote economic growth, and create level playing fields within the global financial system.
Joint Trades Comment Letter on Regulatory Capital Treatment of TLAC Holdings
June 7, 2019
In a letter to financial regulators, the Forum, along with the Bank Policy Institute and the Securities Industry and Financial Markets Association, offered several recommendations to a proposal on the regulatory capital treatment of advanced approaches firms’ investments in certain unsecured debt instruments of U.S. GSIBs. The letter offers several recommendations that would allow the final rule to address interconnectedness and other risks relating to a GSIB’s failure more appropriately. The recommendations would further the policy objectives of efficiency and simplicity in regulation, and would also facilitate the ability of advanced approaches firms to engage in market-making activity, which supports the depth and liquidity of markets for TLAC-eligible debt.
Joint Trades Letter: Time to Update Inter-Affiliate Initial Margin Requirements
May 13, 2019
To level the playing field for U.S. firms, the Forum, along with six financial trade groups, called on federal regulators to make the current margin rules for both non-cleared and security-based swaps consistent with international standards. Specifically, the group requested that the prudential regulators provide an exception from initial margin requirements for swaps and security-based swaps between affiliates.
Joint Trades Letter: Support for H.R. 2513, the "Corporate Transparency Act of 2019”
May 7, 2019
In a letter to House Financial Services Committee Chairwoman Maxine Waters and Ranking Member Patrick McHenry, the Forum and eight financial services trade associations commended the Committee’s work to modernize the anti-money laundering and counterterrorism regulatory system, and urged bipartisan support and swift action on H.R. 2513, the Corporate Transparency Act of 2019.
Comment Letter: Forum Recommends Improvements to New Approach for Measuring Derivatives Exposures
March 18, 2019
The proposed methodology for calculating capital requirements related to derivatives contracts should be improved to increase efficiency and avoid unnecessary costs for customers.
Comment Letter: Forum Recommends Changes to Improve Volcker Rule
October 17, 2018
In a letter to financial regulators, the Forum commented on proposed changes to the Volcker Rule and made recommendations that would reduce barriers limiting banks’ ability to lend to businesses and households and invest in communities across the country. The Forum also made recommendations to further streamline the proposal’s compliance regime, while still preserving the original intent of the law.
Comment Letter: Forum Outlines Recommendations to Improve Resolution Planning Process
September 14, 2018
Large U.S. financial institutions have significantly enhanced their resolvability through the resolution planning process, but the current framework should be improved to promote efficiency, the Financial Services Forum wrote in response to a request for comment from the Board of Governors of the Federal Reserve System (FRB) and the Federal Deposit Insurance Corporation (FDIC) on the resolution planning, or “living wills,” process.
Congressional Testimony: Forum Supports Capital Rules Review
July 17, 2018
Financial Services Forum President and CEO Kevin Fromer testified before the House Financial Services Subcommittee on Financial Institutions and Consumer Credit and explained how the Forum supports the systematic review of U.S. capital rules to ensure the regulatory system balances the important goals of a safe and sound financial system with one that best supports economic growth and job creation.
Comment Letter: Federal Reserve Proposal to Establish Stress Capital Buffer
June 25, 2018
The Forum sent a comment letter to the Board of Governors of the Federal Reserve System on its proposal to integrate its regulatory capital rule with its capital planning and stress testing rules while establishing a new stress capital buffer.
In the letter the Forum made the following points:
- Integration of the stress testing and capital regimes to achieve a more unified and simplified capital regime is a laudable goal, but the Federal Reserve should undertake a broader review of its capital and stress testing programs to ensure that boards of directors at financial institutions can clearly and appropriately make capital management decisions; and
- The proposal underscores the need for the Federal Reserve to enhance the transparency of its stress testing models and scenarios designs.
Comment Letter: Federal Reserve, Office of the Comptroller of the Currency Proposal to Modify Enhanced Supplementary Leverage Ratio
June 25, 2018
The Forum sent a comment letter to the Federal Reserve and the Office of the Comptroller of the Currency (OCC) on their proposal to modify the enhanced supplementary leverage ratio.
In the letter the Forum made the following points:
- The effort by the Federal Reserve and OCC to recalibrate the rule is positive, but the leverage calculations should exclude risk-free assets to eliminate the economic incentive to reduce participation in lower-risk, lower-return businesses;
- The agencies should take additional steps to ensure that leverage capital requirements act as a backstop to risk-based capital requirements, rather than as a binding constraint; and
- As part of their broader review, the agencies should evaluate the “gold-plating” of international regulatory standards in the United States, which has led to much higher capital standards in the United States than in other countries, harming the international competitiveness of U.S. banks relative to their global peers.