Regulatory Alerts2026-09-10
Added
Capital Adequacy Requirements (CAR) (2027) – Chapter 5 – Credit Risk – Internal Ratings-Based Approach
This guideline establishes the requirements for the Internal Ratings-Based (IRB) approach to credit risk for banks, bank holding companies, federally regulated trust companies, and federally regulated loan companies. It defines eligible asset classes, including corporate, sovereign, public sector entity, bank, and retail exposures, and specifies the risk components such as probability of default, loss given default, and exposure at default. The document sets out minimum requirements for rating system design, operations, validation, and corporate governance that institutions must satisfy to use internal estimates for capital calculations. The effective date is November 2026 or January 2027, depending on the institution's fiscal year end.