Agencies Finalize Large Bank Stress Testing Guidance

On Monday, May 14, 2012, the Federal Reserve Board (the "Fed"), the Office of the Comptroller of the Currency (the "OCC"), and the Federal Deposit Insurance Corporation (the "FDIC") issued final supervisory guidance regarding stress-testing practices at banking organizations with total consolidated assets of more than $10 billion.  The guidance does not implement the stress testing requirements in the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act") or in the Fed's capital plan rule that apply to certain companies, as those requirements have been or are being implemented through separate proposals by the respective agencies.  However, the agencies expect that banking organizations with total consolidated assets of more than $10 billion would follow the principles set forth in the guidance—as well as other relevant supervisory guidance—when conducting stress testing in accordance with the Dodd-Frank Act, the capital plan rule, and other statutory or regulatory requirements.

Read the Fed press release

Read the OCC press release

Read the FDIC press release

Agencies Clarify Supervisory Expectations for Stress Testing by Community Banks

On Monday, May 14, 2012, Fed, the OCC, and the FDIC issued a joint statement to clarify expectations for stress testing by community banks—banks, savings associations, and bank and savings and loan holding companies with $10 billion or less in total assets.  The agencies clarified that community banks are not required or expected to conduct the types of stress testing required of larger organizations.

Read the Fed press release

Read the OCC press release 

Read the FDIC press release 

CFTC Proposes to Again Delay the Effective Date of Certain Swap Regulation

On Wednesday, May 16, 2012, the Commodity Futures Trading Commission (the "CFTC") proposed to further amend its July 14, 2011 final order that granted temporary exemptive relief from certain provisions of the Commodity Exchange Act that otherwise would have taken effect on July 16, 2011, the general effective date of Title VII of the Dodd-Frank Act.  The CFTC previously amended this order on December 23, 2011 to, in part, extend the expiration from December 31, 2011 to July 16, 2012.  The currently proposed amendment further modifies the temporary exemptive relief granted in the order by:

• Removing references to the entities terms, including "swap dealer," "major swap participant," and "eligible contract participant" in light of the final, joint CFTC-Securities and Exchange Commission rulemaking further defining the terms issued on April 18, 2012;
  
  
• Extending the potential latest expiration date of the order to December 31, 2012, or, depending on the nature of the relief, such other compliance date as may be determined by the CFTC;
  
  
• Allowing the clearing of agricultural swaps; and
  
  
• Removing any reference to the exempt commercial market and exempt board of trade grandfather relief previously issued by the CFTC.

© 2012 Perkins Coie LLP