On May 19, 2020, the Office of the Comptroller of the Currency (OCC), the Board of Governors of the Federal Reserve System, and the Federal Deposit Insurance Corporation announced a final rule that makes technical changes in the interim final rule (85 FR 29839) that the agencies announced on March 27, 2020. The interim final rule allows certain banks to delay the estimated impact on regulatory capital stemming from the implementation of Accounting Standards Update No. 2016-13, “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.”

The final rule makes these technical changes to the interim final rule:

• Specifies that Category III banking organizations that elect to use the CECL transition in the interim final rule can adjust total leverage exposure when calculating the supplemental leverage ratio.

• Clarifies that for purposes of calculating the modified CECL transitional amount and modified adjusted allowances for credit losses transitional amount under the interim final rule, the CECL transitional amount, deferred tax assets transitional amount, and adjusted allowances for credit losses transitional amount can be either a positive or negative number.

The rule is available at: https:// www.govinfo.gov/content/pkg/ FR-2020-05-19/pdf/2020-08789. pdf.


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