(a) External long-term debt requirement. Except as provided under
paragraph (c) of this section, a global systemically important BHC
must maintain an outstanding eligible external long-term debt amount
that is no less than the amount equal to the greater of:
(1) The global systemically important BHC’s
total risk-weighted assets multiplied by the sum of 6 percent plus
the global systemically important BHC’s GSIB surcharge (expressed
as a percentage); and
(2) 4.5 percent of the global systemically important BHC’s total
leverage exposure.
(b) Outstanding eligible external long-term debt
amount.
(1) A global systemically important BHC’s
outstanding eligible external long-term debt amount is the sum of:
(i) One hundred (100) percent of the amount due to be paid of unpaid
principal of the outstanding eligible debt securities issued by the
global systemically important BHC in greater than or equal to 730
days (two years);
(ii) Fifty (50) percent of the amount due to be paid of unpaid principal
of the outstanding eligible debt securities issued by the global systemically
important BHC in greater than or equal to 365 days (one year) and
less than 730 days (two years); and
(iii) Zero (0) percent of the amount
due to be paid of unpaid principal of the outstanding eligible debt
securities issued by the global systemically important BHC in less
than 365 days (one year).
(2) For purposes of paragraph (b)(1) of
this section, the date on which principal is due to be paid on an
outstanding eligible debt security is calculated from the earlier
of:
(i) The date on which payment of principal
is required under the terms governing the instrument, without respect
to any right of the holder to accelerate payment of principal; and
(ii) The date the holder
of the instrument first has the contractual right to request or require
payment of the amount of principal, provided that, with respect to
a right that is exercisable on one or more dates that are specified
in the instrument only on the occurrence of an event (other than an
event of a receivership, insolvency, liquidation, or similar proceeding
of the global systemically important BHC, or a failure of the global
systemically important BHC to pay principal or interest on the instrument
when due), the date for the outstanding eligible debt security under
this paragraph (b)(2)(ii) will be calculated as if the event has occurred.
(3) After notice and response proceedings consistent with 12 CFR
part 263, subpart E, the Board may order a global systemically important
BHC to exclude from its outstanding eligible long-term debt amount
any debt security with one or more features that would significantly
impair the ability of such debt security to take losses.
(c) Redemption and repurchase. A global systemically important BHC may not redeem or repurchase
any outstanding eligible debt security without the prior approval
of the Board if, immediately after the redemption or repurchase, the
global systemically important BHC would not meet its external long-term
debt requirement under paragraph (a) of this section, or its external
total loss-absorbing capacity requirement under section 252.63(a).
