[Federal Register Volume 71, Number 247 (Tuesday, December 26, 2006)]
[Proposed Rules]
[Pages 77518-77519]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-9737]


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DEPARTMENT OF THE TREASURY

Office of the Comptroller of the Currency

12 CFR Part 3

[Docket No. 06-09]
RIN 1557-AC91

FEDERAL RESERVE SYSTEM

12 CFR Parts 208 and 225

[Regulations H and Y; Docket No. R-1261]

FEDERAL DEPOSIT INSURANCE CORPORATION

12 CFR Part 325

RIN 3064-AC73

DEPARTMENT OF THE TREASURY

Office of Thrift Supervision

12 CFR Part 566

[Docket No. 2006-33]
RIN 1550-AB56


Risk-Based Capital Standards: Advanced Capital Adequacy Framework

AGENCIES: Office of the Comptroller of the Currency, Treasury; Board of 
Governors of the Federal Reserve System; Federal Deposit Insurance 
Corporation; and Office of Thrift Supervision, Treasury.

ACTION: Joint notice of proposed rulemaking; extension of comment 
period.

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SUMMARY: On September 25, 2006, the Office of the Comptroller of the 
Currency (OCC), the Board of Governors of the Federal Reserve System 
(Board), the Federal Deposit Insurance Corporation (FDIC), and the 
Office of Thrift Supervision (OTS) (collectively, the agencies) issued 
a joint notice of proposed rulemaking for public comment that proposed 
a new risk-based capital adequacy framework (Basel II NPR). The Basel 
II NPR would require some and permit other qualifying banks \1\ to use 
an internal ratings-based approach to calculate regulatory credit risk 
capital requirements and advanced measurement approaches to calculate 
regulatory operational risk capital requirements. The Basel II NPR 
describes the qualifying criteria for banks required or seeking to 
operate under the proposed framework and the applicable risk-based 
capital requirements for banks that operate under the framework. The 
Basel II NPR comment period will end on January 23, 2007.
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    \1\ As used in this notice, the term ``bank'' includes banks, 
savings associations, and bank holding companies.
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    In today's issue of the Federal Register, the agencies are 
proposing revisions to the existing risk-based capital framework that 
would apply to banks that do not use the Basel II NPR (Basel IA NPR). 
The agencies have determined that an extension of the Basel II NPR 
comment period is appropriate to allow interested parties additional 
time to compare the risk-based capital requirements as proposed in the 
Basel II NPR with the risk-based capital requirements as proposed in 
the Basel IA NPR.

DATES: The comment period for the proposed rule published at 71 FR 
55830 (Sept. 25, 2006) is extended until March 26, 2007.

ADDRESSES: You may submit comments by any of the methods identified in 
the Basel II NPR (See 71 FR 55830, September 25, 2006.)

FOR FURTHER INFORMATION CONTACT: OCC: Roger Tufts, Senior Economic 
Advisor, Capital Policy (202-874-4925) or Ron Shimabukuro, Special 
Counsel, Legislative and Regulatory Activities Division (202-874-5090). 
Office of the Comptroller of the Currency, 250 E Street, SW., 
Washington, DC 20219.
    Board: Barbara Bouchard, Deputy Associate Director (202-452-3072 or 
<a href="/cdn-cgi/l/email-protection#05676477676477642b676a70666d647761456377672b626a73"><span class="__cf_email__" data-cfemail="5e3c3f2c3c3f2c3f703c312b3d363f2c3a1e382c3c70393128">[email protected]</span></a>) or Anna Lee Hewko, Senior Supervisory 
Financial Analyst (202-530-6260 or <a href="/cdn-cgi/l/email-protection#f998979798d7919c8e9296b99f8b9bd79e968f"><span class="__cf_email__" data-cfemail="a7c6c9c9c689cfc2d0ccc8e7c1d5c589c0c8d1">[email protected]</span></a>), Division of 
Banking Supervision and Regulation; or Mark E. Van Der Weide, Senior 
Counsel (202-452-2263 or <a href="/cdn-cgi/l/email-protection#2845495a43065e49464c4d5a5f4d414c4d684e5a4a064f475e"><span class="__cf_email__" data-cfemail="8de0ecffe6a3fbece3e9e8fffae8e4e9e8cdebffefa3eae2fb">[email protected]</span></a>), Legal Division. For 
users of Telecommunications Device for the Deaf (``TDD'') only, contact 
202-263-4869.
    FDIC: Jason C. Cave, Associate Director, Capital Markets Branch, 
(202) 898-3548, Bobby R. Bean, Chief, Policy Section, Capital Markets 
Branch, (202) 898-3575, Kenton Fox, Senior Capital Markets Specialist, 
Capital Markets

[[Page 77519]]

Branch, (202) 898-7119, Division of Supervision and Consumer 
Protection; or Michael B. Phillips, Counsel, (202) 898-3581, 
Supervision and Legislation Branch, Legal Division, Federal Deposit 
Insurance Corporation, 550 17th Street, NW., Washington, DC 20429.
    OTS: Michael D. Solomon, Director, Capital Policy, Supervision 
Policy (202) 906-5654; David W. Riley, Senior Analyst, Capital Policy 
(202) 906-6669; or Karen Osterloh, Special Counsel, Regulations and 
Legislation Division (202) 906-6639, Office of Thrift Supervision, 1700 
G Street, NW., Washington, DC 20552.

SUPPLEMENTARY INFORMATION: On September 25, 2006, the agencies issued 
the Basel II NPR, which proposed a new risk-based capital adequacy 
framework that would require some and permit other qualifying banks to 
use an internal ratings-based approach to calculate regulatory credit 
risk capital requirements and advanced measurement approaches to 
calculate regulatory operational risk capital requirements. See 71 FR 
55830. The proposed rule describes the qualifying criteria for banks 
required or seeking to operate under the proposed framework and the 
applicable risk-based capital requirements for banks that would operate 
under that framework.
    In today's issue of the Federal Register, the agencies are 
proposing revisions to the existing risk-based capital framework 
applicable to banks that would not use the Basel II NPR. The Basel IA 
NPR proposes to expand the number of risk weight categories, allow the 
use of external credit ratings to risk weight certain exposures, expand 
the range of recognized collateral and eligible guarantors, use loan-
to-value ratios to risk weight most residential mortgages, and revise 
other provisions of the existing risk-based capital requirements to 
increase the risk sensitivity of the risk-based capital rules for those 
banks that will not use the proposed risk-based capital requirements in 
the Basel II NPR.
    The agencies believe that it is important for interested parties to 
be able to compare the risk-based capital requirements in the Basel II 
NPR and Basel IA NPR. Therefore, the agencies are extending the comment 
period for the Basel II NPR from January 23, 2007, to March 26, 2007.

    Dated: December 5, 2006.
John C. Dugan,
Comptroller of the Currency.
    Dated: December 8, 2006.

    By order of the Board of Governors of the Federal Reserve 
System.
Jennifer J. Johnson,
Secretary of the Board.
    Dated at Washington, DC, this 5th day of December, 2006.

    By order of the Board of Directors,
Federal Deposit Insurance Corporation.
Valerie J. Best,
Assistant Executive Secretary.
    Dated: December 11, 2006.
John Reich,
Director.
[FR Doc. 06-9737 Filed 12-22-06; 8:45 am]
BILLING CODE 4810-33-P; 6210-01-P; 6714-01-P; 6720-01-P


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