Fed plans meeting to finalize reg relief for midsize banks

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WASHINGTON — The Federal Reserve Board will hold a meeting next week to finalize changes to its enhanced supervision program as well as requirements for institutions to submit wind-down plans.

The meeting Thursday will focus on a plan seen as benefiting mostly midsize and regional banks. The Fed in October proposed to create a tiered structure for domestic bank and thrift holding companies with over $100 billion of assets.

The proposal would be a departure from the post-crisis policy of subjecting all banks with over $50 billion of assets to enhanced supervision. Under the new system, supervision for midsize banks would be eased compared to the largest banks. The Fed also proposed in April a similar tiered structure for foreign banks and a reduction in how often firms submit resolution plans.

The Fed proposed some of the changes on its own and some in concert with the Federal Deposit Insurance Corp. and the Office of the Comptroller of the Currency. The new structure would reduce capital, liquidity and procedural requirements for many of the bank holding companies the Fed supervises. But in certain cases, the liquidity requirements for some foreign banks would actually become stronger.

The October proposal for U.S. banks was largely mandated by the regulatory law enacted by Congress last spring. While lawmakers had not specifically required the central bank to alter foreign bank requirements, the plan to do so was widely anticipated.

The Fed will also discuss the April proposal to ease living will requirements, which was issued jointly FDIC. That plan would create similar risk-based categories to tailor resolution plan requirements for firms based mostly on size.

Federal Reserve Gov. Lael Brainard dissented from all of the proposals.

At the Oct. 10 meeting, the Fed board will also discuss a proposal to alter the fees large banks are charged for their supervision under the new set of prudential standards.

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Regulatory relief Regulatory reform Living wills Liquidity requirements Minimum capital requirements Federal Reserve FDIC OCC