The Federal Reserve’s proposal to implement enhanced prudential standards for large bank holding companies

December 2011
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The Federal Reserve’s proposal to implement enhanced prudential standards for large bank holding companies

At a glance

December 2011 - The Federal Reserve Board (FRB) issued a proposal to implement Sections 165 and 166 of the Dodd-Frank Act (Dodd-Frank or the Act) that it views as 'package of enhanced prudential standards' on bank holding companies and on nonbank financial companies (NBFCs) that are designated for supervision by the FRB. Comments are due on the proposal by March 31, 2012.

On Tuesday, December 20, 2011, the Federal Reserve Board (FRB) issued a proposal to implement Sections 165 and 166 of the Dodd-Frank Act (Dodd-Frank or the Act). Early rumor had it that this package of regulatory proposals would run to a thousand pages or more and would greatly add to the regulatory burdens on large complex BHCs, which have been the subject directly or indirectly of most Dodd-Frank related rule-makings. Perhaps moved by the Holiday Season, the FRB’s proposal is “only” 173 pages in length (the Volcker proposal is almost twice as long). More important than reasonable volume is the proposal’s gradual or phased-in approach to implementation.

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