Implementation of Financial Services Regulatory Reform Legislation: Federal Banking Agencies Release Statements on How They Will Implement Provisions of the Economic Growth, Regulatory Relief, and Consumer Protection Act That Have Immediate Effect

Sullivan & Cromwell LLP - July 12, 2018

On July 6, the three Federal banking agencies—the Board of Governors of the Federal Reserve System (the “Federal Reserve”), the Federal Deposit Insurance Corporation (the “FDIC”), and the Office of the Comptroller of the Currency (the “OCC”)—issued an interagency statement (the “Interagency Statement”) describing how the recently enacted Economic Growth, Regulatory Relief, and Consumer Protection Act (“EGRRCPA”) will affect their positions on certain rules and other requirements that are jointly administered by the three agencies. Also on July 6, the Federal Reserve released a separate statement (the “Federal Reserve Statement”) describing how EGRRCPA would affect its positions regarding certain regulations and other requirements administered solely by the Federal Reserve.

The two statements address the implementation of aspects of EGRRCPA that became effective at, or shortly after, the date of enactment of the legislation. Most notably, the statements address the impact of an initial increase in the asset threshold (often referred to as the “SIFI” threshold) above which the Federal Reserve is required to apply the “enhanced prudential standards” (“EPS”) in Section 165 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”).