(a) Capital conservation and countercyclical capital buffer.
(1) From January 1, 2014 through December
31, 2015, a Board-regulated institution is not subject to limits on
distributions and discretionary bonus payments under section 217.11
of subpart B of this part notwithstanding the amount of its capital
conservation buffer or any applicable countercyclical capital buffer
amount.
(2) Notwithstanding
section 217.11, beginning January 1, 2016 through December 31, 2018
a Board-regulated institution’s maximum payout ratio shall be determined
as set forth in Table 1 to section 217.300.
Table 1 to section
217.300
| Transition period |
Capital conservation
buffer |
Maximum payout
ratio (as a percentage of eligible retained income) |
| Calendar year 2016 |
Greater than 0.625
percent plus 25 percent of any applicable countercyclical capital
buffer amount and 25 percent of any applicable GSIB surcharge |
No payout ratio limitation
applies under this section |
| Less than or equal
to 0.625 percent plus 25 percent of any applicable countercyclical
capital buffer amount and 25 percent of any applicable GSIB surcharge, and greater than 0.469 percent plus 17.25 percent of any applicable
countercyclical capital buffer amount and 17.25 percent of any applicable
GSIB surcharge |
60 percent |
| Less than or equal
to 0.469 percent plus 17.25 percent of any applicable countercyclical
capital buffer amount and 17.25 percent of any applicable GSIB surcharge, and greater than 0.313 percent plus 12.5 percent of any applicable
countercyclical capital buffer amount and 12.5 percent of any applicable
GSIB surcharge |
40 percent |
| Less than or equal
to 0.313 percent plus 12.5 percent of any applicable countercyclical
capital buffer amount and 12.5 percent of any applicable GSIB surcharge, and greater than 0.156 percent plus 6.25 percent of any applicable
countercyclical capital buffer amount and 6.25 percent of any applicable
GSIB surcharge |
20 percent |
| Less than or equal
to 0.156 percent plus 6.25 percent of any applicable countercyclical
capital buffer amount and 6.25 percent of any applicable GSIB surcharge |
0 percent |
| Calendar year 2017 |
Greater than 1.25
percent plus 50 percent of any applicable countercyclical capital
buffer amount and 50 percent of any applicable GSIB surcharge |
No payout ratio limitation
applies under this section |
| Less than or equal
to 1.25 percent plus 50 percent of any applicable countercyclical
capital buffer amount and 50 percent of any applicable GSIB surcharge, and greater than 0.938 percent plus 37.5 percent of any applicable
countercyclical capital buffer amount and 37.5 percent of any applicable
GSIB surcharge |
60 percent |
| Less than or equal
to 0.938 percent plus 37.5 percent of any applicable countercyclical
capital buffer amount and 37.5 percent of any applicable GSIB surcharge, and greater than 0.625 percent plus 25 percent of any applicable
countercyclical capital buffer amount and 25 percent of any applicable
GSIB surcharge |
40 percent |
| Less than or equal
to 0.625 percent plus 25 percent of any applicable countercyclical
capital buffer amount and 25 percent of any applicable GSIB surcharge, and greater than 0.313 percent plus 12.5 percent of any applicable
countercyclical capital buffer amount and 12.5 percent of any applicable
GSIB surcharge |
20 percent |
| Less than or equal
to 0.313 percent plus 12.5 percent of any applicable countercyclical
capital buffer amount and 12.5 percent of any applicable GSIB surcharge |
0 percent |
Table 1 to
section 217.300—continued
| Transition period |
Capital conservation
buffer |
Maximum payout
ratio (as a percentage of eligible retained income) |
| Calendar year 2018 |
Greater than 1.875
percent plus 75 percent of any applicable countercyclical capital
buffer amount and 75 percent of any applicable GSIB surcharge |
No payout ratio limitation
applies under this section |
| Less than or equal
to 1.875 percent plus 75 percent of any applicable countercyclical
capital buffer amount and 75 percent of any applicable GSIB surcharge, and greater than 1.406 percent plus 56.25 percent of any applicable
countercyclical capital buffer amount and 56.25 percent of any applicable
GSIB surcharge |
60 percent |
| Less than or equal
to 1.406 percent plus 56.25 percent of any applicable countercyclical
capital buffer amount and 56.25 percent of any applicable GSIB surcharge, and greater than 0.938 percent plus 37.5 percent of any applicable
countercyclical capital buffer amount and 37.5 percent of any applicable
GSIB surcharge |
40 percent |
| Less than or equal
to 0.938 percent plus 37.5 percent of any applicable countercyclical
capital buffer amount and 37.5 percent of any applicable GSIB surcharge, and greater than 0.469 percent plus 18.75 percent of any applicable
countercyclical capital buffer amount and 18.75 percent of any applicable
GSIB surcharge |
20 percent |
| Less than or equal
to 0.469 percent plus 18.75 percent of any applicable countercyclical
capital buffer amount and 18.75 percent of any applicable GSIB surcharge |
0 percent |
(b) [Reserved]
Table 2 to section
217.300
| Transition period |
Transition deductions under section 217.22(a)(1) and (7) |
Transition deductions under section 217.22(a)(3)-(6) |
| |
Percentage of the deductions from common equity tier
1 capital |
Percentage of the deductions from common equity tier
1 capital |
Percentage of the deductions from tier 1 capital |
| Calendar
year 2014 |
100 |
20 |
80 |
| Calendar
year 2015 |
100 |
40 |
60 |
| Calendar
year 2016 |
100 |
60 |
40 |
| Calendar
year 2017 |
100 |
80 |
20 |
| Calendar
year 2018, and thereafter |
100 |
100 |
0 |
Table 3 to section
217.300
| Transition period |
Transition deductions under section 217.22(a)(2)—Percentage of the
deductions from common equity tier 1 capital |
| Calendar year 2014 |
20 |
| Calendar year 2015 |
40 |
| Calendar year 2016 |
60 |
| Calendar year 2017 |
80 |
| Calendar year 2018,
and thereafter |
100 |
Table 4 to section
217.300
| Transition period |
Transition adjustments under section 217.22(b)(2) |
| |
Percentage of the adjustment applied to common equity
tier 1 capital |
Percentage of the adjustment applied to tier 1 capital |
| Calendar year 2014 |
20 |
80 |
| Calendar year 2015 |
40 |
60 |
| Calendar year 2016 |
60 |
40 |
| Calendar year 2017 |
80 |
20 |
| Calendar year 2018,
and thereafter |
100 |
0 |
Table 5 to
section 217.300
| Transition period |
Percentage of the transition AOCI adjustment amount to be applied
to common equity tier 1 capital |
| Calendar
year 2014 |
80 |
| Calendar
year 2015 |
60 |
| Calendar
year 2016 |
40 |
| Calendar
year 2017 |
20 |
| Calendar
year 2018, and thereafter |
0 |
Table 6 to section
217.300
| Transition period |
Percentage of unrealized gains on available-for-sale preferred stock
classified as an equity security under GAAP and available-for-sale
equity exposures that may be included in tier 2 capital |
| Calendar
year 2014 |
36 |
| Calendar
year 2015 |
27 |
| Calendar
year 2016 |
18 |
| Calendar
year 2017 |
9 |
| Calendar
year 2018, and thereafter |
0 |
Table 7 to section
217.300
| Transition period |
Transitions for deductions under section 217.22(c) and (d)—Percentage
of additional deductions from regulatory capital |
| Calendar
year 2014 |
20 |
| Calendar
year 2015 |
40 |
| Calendar
year 2016 |
60 |
| Calendar
year 2017 |
80 |
| Calendar
year 2018, and thereafter |
100 |
(c) Non-qualifying capital instruments.
(1) Depository
institution holding companies with total consolidated assets of more
than $15 billion as of December 31, 2009 that were not mutual holding
companies prior to May 19, 2010. The transition provisions in
this paragraph (c)(1) apply to debt or equity instruments that do
not meet the criteria for additional tier 1 or tier 2 capital instruments
in section 217.20, but that were issued and included in tier 1 or
tier 2 capital, respectively prior to May 19, 2010 (non-qualifying
capital instruments), and that were issued by a depository institution
holding company with total consolidated assets greater than or equal
to $15 billion as of December 31, 2009 that was not a mutual holding
company prior to May 19, 2010 (2010 MHC) (depository institution holding
company of $15 billion or more).
(i) A depository institution
holding company of $15 billion or more may include in tier 1 and tier
2 capital non-qualifying capital instruments up to the applicable
percentage set forth in Table 8 to section 217.300 of the aggregate
outstanding principal amounts of non-qualifying tier 1 and tier 2
capital instruments, respectively, that are outstanding as of January
1, 2014, beginning January 1, 2014, for a depository institution holding
company of $15 billion or more that is an advanced approaches Board-regulated
institution that is not a savings and loan holding company, and beginning
January 1, 2015, for all other depository institution holding companies
of $15 billion or more.
(ii) A depository institution holding company of $15 billion or more
must apply the applicable percentages set forth in Table 8 to section
217.300 separately to the aggregate amounts of its tier 1 and tier
2 non-qualifying capital instruments.
(iii) The amount of non-qualifying capital
instruments that must be excluded from additional tier 1 capital in
accordance with this section may be included in tier 2 capital without
limitation, provided the instruments meet the criteria for tier 2
capital set forth in section 217.20(d).
(iv) Non-qualifying capital instruments
that do not meet the criteria for tier 2 capital set forth in section
217.20(d) may be included in tier 2 capital as follows:
(A) A depository
institution holding company of $15 billion or more that is not an
advanced approaches Boardregulated institution may include non-qualifying
capital instruments that have been phased-out of tier 1 capital in
tier 2 capital, and
(B)
During calendar years 2014 and 2015, a depository institution holding
company of $15 billion or more that is an advanced approaches Board-regulated
institution may include non-qualifying capital instruments in tier
2 capital that have been phased out of tier 1 capital in accordance
with Table 8 to section 217.300. Beginning January 1, 2016, a depository
institution holding company of $15 billion or more that is an advanced
approaches Board-regulated institution may include non-qualifying
capital instruments in tier 2 capital that have been phased out of
tier 1 capital in accordance with Table 8, up to the applicable percentages
set forth in Table 9 to section 217.300.
(2) Mergers and acquisitions.
(i) A depository
institution holding company of $15 billion or more that acquires after
December 31, 2013 either a depository institution holding company
with total consolidated assets of less than $15 billion as of December
31, 2009 (depository institution holding company under $15 billion)
or a depository institution holding company that is a 2010 MHC, may
include in regulatory capital the non-qualifying capital instruments
issued by the acquired organization up to the applicable percentages
set forth in Table 8 to section 217.300.
(ii) If a depository institution holding
company under $15 billion acquires after December 31, 2013 a depository
institution holding company under $15 billion or a 2010 MHC, and the
resulting organization has total consolidated assets of $15 billion
or more as reported on the resulting organization’s FR Y-9C for the
period in which the transaction occurred, the resulting organization
may include in regulatory capital non-qualifying instruments of the
resulting organization up to the applicable percentages set forth
in Table 8 to section 217.300.
(3) Depository
institution holding companies under $15 billion and 2010 MHCs.
(i) Non-qualifying capital instruments
issued by depository institution holding companies under $15 billion
and 2010 MHCs prior to May 19, 2010, may be included in additional
tier 1 or tier 2 capital if the instrument was included in tier 1
or tier 2 capital, respectively, as of January 1, 2014.
(ii) Non-qualifying capital
instruments includable in tier 1 capital are subject to a limit of
25 percent of tier 1 capital elements, excluding any non-qualifying
capital instruments and after applying all regulatory capital deductions
and adjustments to tier 1 capital.
(iii) Non-qualifying capital instruments
that are not included in tier 1 as a result of the limitation in paragraph
(c)(3)(ii) of this section are includable in tier 2 capital.
(4) Depository institutions.
(i) Beginning
on January 1, 2014, a depository institution that is an advanced approaches
Board-regulated institution, and beginning on January 1, 2015, all
other depository institutions, may include in regulatory capital debt
or equity instruments issued prior to September 12, 2010 that do not
meet the criteria for additional tier 1 or tier 2 capital instruments
in section 217.20 but that were included in tier 1 or tier 2 capital
respectively as of September 12, 2010 (non-qualifying capital instruments
issued prior to September 12, 2010) up to the percentage of the outstanding
principal amount of such non-qualifying capital instruments as of
January 1, 2014 in accordance with Table 9 to section 217.300.
(ii) Table 9 to section
217.300 applies separately to tier 1 and tier 2 non-qualifying capital
instruments.
(iii)
The amount of non-qualifying capital instruments that cannot be included
in additional tier 1 capital under this section may be included in
tier 2 capital without limitation, provided that the instruments meet
the criteria for tier 2 capital instruments under section 217.20(d).
(d) [Reserved]
Table 8 to section
217.300
| Transition period (calendar year) |
Percentage of non-qualifying capital instruments includable in additional
tier 1 or tier 2 capital for a depository institution holding company
of $15 billion or more |
| Calendar
year 2014 |
50 |
| Calendar
year 2015 |
25 |
| Calendar
year 2016, and thereafter |
0 |
Table 9 to section
217.300
| Transition period (calendar
year) |
Percentage of non-qualifying capital instruments includable in additional
tier 1 or tier 2 capital |
| Calendar
year 2014 |
80 |
| Calendar
year 2015 |
70 |
| Calendar
year 2016 |
60 |
| Calendar
year 2017 |
50 |
| Calendar
year 2018 |
40 |
| Calendar
year 2019 |
30 |
| Calendar
year 2020 |
20 |
| Calendar
year 2021 |
10 |
| Calendar
year 2022, and thereafter |
0 |
| Transition period |
Percentage of the amount of surplus or non-qualifying minority interest
that can be included in regulatory capital during the transition period |
| Calendar
year 2014 |
80 |
| Calendar
year 2015 |
60 |
| Calendar
year 2016 |
40 |
| Calendar
year 2017 |
20 |
| Calendar
year 2018, and thereafter |
0 |
(e) Prompt corrective action. For purposes of 12 CFR part 208, subpart
D, a Board-regulated institution must calculate its capital measures
and tangible equity ratio in accordance with the transition provisions
in this section.
(f) Until July 21, 2015, this
part will not apply to any bank holding company subsidiary of a foreign
banking organization that is currently relying on Supervision and
Regulation Letter SR-01-01 issued by the Board (as in effect on May
19, 2010).
(g) A Board-regulated
institution that is not an advanced approaches Board-regulated institution
may apply the treatment under sections 217.21 and 217.22(c)(2), (5),
(6), and (d)(2) applicable to an advanced approaches Board-regulated
institution during the calendar quarter beginning January 1, 2020.
During the quarter beginning January 1, 2020, a Board-regulated institution
that makes such an election must deduct 80 percent of the amount otherwise
required to be deducted under section 217.22(d)(2) and must apply
a 100 percent risk weight to assets not deducted under section 217.22(d)(2).
In addition, during the quarter beginning January 1, 2020, a Board-regulated
institution that makes such an election must include in its regulatory
capital 20 percent of any minority interest that exceeds the amount
of minority interest includable in regulatory capital under section
217.21 as it applies to an advanced approaches Board-regulated institution.
A Board-regulated institution that is not an advanced approaches Board-regulated
institution must apply the treatment under sections 217.21 and 217.22
applicable to a Board-regulated institution that is not an advanced
approaches Board-regulated institution beginning April 1, 2020, and
thereafter.
(h) SA-CCR. An advanced approaches Board-regulated institution may use CEM rather
than SA-CCR for purposes of sections 217.34(a) and 217.132(c) until
January 1, 2022. A Board-regulated institution must provide prior
notice to the Board if it decides to begin using SA-CCR before January
1, 2022. On January 1, 2022, and thereafter, an advanced approaches
Board-regulated institution must use SA-CCR for purposes of sections
217.34(a), 217.132(c), and 217.135(d). Once an advanced approaches
Board-regulated institution has begun to use SA-CCR, the advanced
approaches Board-regulated institution may not change to use CEM.
(i) Default fund contributions. Prior to January 1, 2022, a Board-regulated institution that calculates
the exposure amounts of its derivative contracts under the standardized
approach for counterparty credit risk in section 217.132(c) may calculate
the risk-weighted asset amount for a default fund contribution to
a QCCP under either method 1 under section 217.35(d)(3)(i) or method
2 under section 217.35(d)(3)(ii), rather than under section 217.133(d).
