(a) General requirements.
(1) A foreign banking
organization subject to this subpart more must certify to the Board
that it meets capital adequacy standards on a consolidated basis that
are established by its home-country supervisor and that are consistent
with the regulatory capital framework published by the Basel Committee
on Banking Supervision, as amended from time to time (Basel Capital
Framework).
(i) For
purposes of this paragraph, home-country capital adequacy standards
that are consistent with the Basel Capital Framework include all minimum
risk-based capital ratios, any minimum leverage ratio, and all restrictions
based on any applicable capital buffers set forth in “Basel III: A
global regulatory framework for more resilient banks and banking systems”
(2010) (Basel III Accord), each as applicable and as implemented in
accordance with the Basel III Accord, including any transitional provisions
set forth therein.
(ii) [Reserved]
(2) In the event that
a home-country supervisor has not established capital adequacy standards
that are consistent with the Basel Capital Framework, the foreign
banking organization must demonstrate to the satisfaction of the Board
that it would meet or exceed capital adequacy standards at the consolidated
level that are consistent with the Basel Capital Framework were it
subject to such standards.
(b) Reporting. A foreign banking organization
subject to this subpart must provide to the Board reports relating
to its compliance with the capital adequacy measures described in
paragraph (a) of this section concurrently with filing the FR Y-7Q.
(c) Noncompliance with the Basel Capital
Framework. If a foreign banking organization does
not satisfy the requirements of this section, the Board may impose
requirements, conditions, or restrictions relating to the activities
or business operations of the U.S. operations of the foreign banking
organization. The Board will coordinate with any relevant State or
Federal regulator in the implementation of such requirements, conditions,
or restrictions. If the Board determines to impose one or more requirements,
conditions, or restrictions under this paragraph, the Board will notify
the organization before it applies any requirement, condition, or
restriction, and describe the basis for imposing such requirement,
condition, or restriction. Within 14 calendar days of receipt of a
notification under this paragraph, the organization may request in
writing that the Board reconsider the requirement, condition, or restriction.
The Board will respond in writing to the organization’s request for
reconsideration prior to applying the requirement, condition, or restriction.
