Capital Brief: Regulators Drop Plan to Collect Rate Risk Data

WASHINGTON - Federal regulators Tuesday abandoned plans to collect interest rate risk data from banks in the first quarter.

Dropping the data-collection requirement is a sign that banks will not have to back interest rate risk with capital anytime soon.

In August, the Federal Reserve Board, Federal Deposit Insurance Corp., and Office of the Comptroller of the Currency announced that - as a preliminary step toward incorporating interest rate risk to capital standards - they would require banks to report data on their vulnerability to interest rate shifts. Banks covered by the rule include those with assets of $300 million or more, plus smaller banks with low Camel ratings or many long-term loans.

In comment letters sent to the agencies, banks criticized the regulators' formula for determining rate risk. On Tuesday, the three agencies announced that after reviewing the comments, they "decided that further analysis of the proposal is necessary." The agencies gave no indication of when that analysis will be completed.

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