Regulatory AlertsSR 20-8: Joint Statement on Adjustment to the Calculation for Credit Concentration Ratios Used in the Supervisory Approach
The Federal Reserve Board, FDIC, and OCC issued a joint statement to clarify the calculation of credit concentration ratios for supervisory purposes. Effective March 31, 2020, the agencies replaced total capital with tier 1 capital plus specific allowance amounts as the denominator to accommodate community banking organizations using the community bank leverage ratio framework. This adjustment ensures consistent supervisory assessments while leaving total capital calculations for other regulatory requirements unchanged.
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