(a) Changes to advanced systems. A Board-regulated institution must
meet all the qualification requirements in section 217.122 on an ongoing
basis. A Board-regulated institution must notify the Board when the
Board-regulated institution makes any change to an advanced system
that would result in a material change in the Board-regulated institution’s
advanced approaches total risk-weighted asset amount for an exposure
type or when the Board-regulated institution makes any significant
change to its modeling assumptions.
(b) Failure to comply with qualification requirements.
(1) If the Board determines
that a Board-regulated institution that uses this subpart and that
has conducted a satisfactory parallel run fails to comply with the
qualification requirements in section 217.122, the Board will notify
the Board-regulated institution in writing of the Board-regulated
institution’s failure to comply.
(2) The Board-regulated institution must
establish and submit a plan satisfactory to the Board to return to
compliance with the qualification requirements.
(3) In addition, if the Board determines
that the Board-regulated institution’s advanced approaches total risk-weighted
assets are not commensurate with the Board-regulated institution’s
credit, market, operational, or other risks, the Board may require
such a Board-regulated institution to calculate its advanced approaches
total risk-weighted assets with any modifications provided by the
Board.
