The Regulatory Environment

Treasury Department: The Treasury Department is the executive agency responsible for promoting economic prosperity and ensuring the financial security of the United States. The Department is responsible for a wide range of activities such as advising the president on economic and financial issues, encouraging sustainable economic growth, and fostering improved governance in financial institutions.

Office of Financial Stability (OFS): The Office of Financial Stability (OFS) was created within the U.S. Department of the Treasury in October of 2008 following the passage of the Emergency Economic Stabilization Act of 2008 (EESA). The mandate of OFS is to implement the Troubled Asset Relief Program (TARP) to help stabilize the U.S. financial system and promote economic recovery, following the 2008 financial crisis. With the government's authority to make new commitments under TARP having expired in 2010, OFS is now carefully managing the wind down of TARP.

Office of Financial Research (OFR): The OFR is an Office within Treasury established by Congress to serve the Financial Stability Oversight Council, its member agencies, and the public by improving the quality, transparency, and accessibility of financial data and information; by conducting and sponsoring research related to financial stability; and by promoting best practices in risk management.

OFR Undertakings:

  • Legal Entity Identifier Initiative: The global legal entity identifier (LEI) is a 20-digit, alpha-numeric code to clearly and uniquely identify companies participating in global financial markets. The code, which contains reference elements conforming with specifications developed by the International Organization for Standardization (ISO), is being put into practice through a framework that adheres to basic principles, including requirements that the LEI be unique and freely available to the public.

  • OFR Research: The OFR is producing, promoting, and sponsoring financial research aimed at developing analytical tools to assess threats to financial stability and evaluating the tools needed to mitigate those threats. 

Office of the Comptroller of the Currency: The OCC is an independent bureau of the Treasury Department.  It charters and is the primary regulator for all national banks and federal savings associations. The OCC also supervises the federal branches and agencies of foreign banks.

Regulations and Guidance

Regulations:

Proposed Regulations (NPRs) and Requests for Comment (Note to Members: This link only includes NPRs with existing open comment periods. Proposals not yet final—but beyond the comment period—are currently unaccounted for on the OCC website, but the OCC recognizes this issue and will be addressing it).

Federal Reserve Board: The Federal Reserve, in addition to serving as the U.S. central bank, is the primary federal regulator for state chartered institutions that are members of the Federal Reserve System, as well as the foreign branches of such banks. Additionally, the Federal Reserve regulates U.S. state-licensed branches of foreign banks. The Federal Reserve also regulates and supervises all U.S. bank and savings and loan holding companies, as well as designated systemically important nonbank financial institutions.

Regulations and Guidance:

FDIC: The Federal Deposit Insurance Corporation (FDIC)  insures deposits in U.S. banks and thrift institutions and is the primary federal regulator for state chartered institutions that are not members of the Federal Reserve System. The FDIC also serves as receiver for all failed insured institutions

Regulations and Guidance:

Federal Financial Institutions Examination Council: The FFIEC is a formal interagency body empowered to prescribe uniform principles, standards, and report forms for the federal examination of financial institutions by the Federal Reserve, FDIC, OCC, NCUA, and CFPB. The FFIEC also makes recommendations to promote uniformity in the supervision of financial institutions.

Financial Stability Oversight Council (FSOC): FSOC is charged with identifying risks to the financial stability of the United States; promoting market discipline; and responding to emerging risks to the stability of the United States' financial system. The Council consists of 10 voting members and 5 nonvoting members and brings together the expertise of federal financial regulators, state regulators, and an independent insurance expert appointed by the president.

Regulations and Guidance:

Basel Committee on Banking Supervision: The Basel Committee on Banking Supervision provides a forum for regular cooperation on banking supervisory matters. Its objective is to enhance understanding of key supervisory issues and improve the quality of banking supervision worldwide. 

History of Basel Committee in 1974–2014

The Committee's members come from Argentina, Australia, Belgium, Brazil, Canada, China, France, Germany, Hong Kong SAR, India, Indonesia, Italy, Japan, Korea, Luxembourg, Mexico, the Netherlands, Russia, Saudi Arabia, Singapore, South Africa, Spain, Sweden, Switzerland, Turkey, the United Kingdom, and the United States.

The Basel Regulatory Framework: On October 10, 2014, the U.S. prudential regulators issued a final rule to implement the Liquidity Coverage Ratio in the United States, which would strengthen the liquidity positions of large financial institutions. In July 2013, the Federal Reserve Board finalized a rule to implement Basel III capital rules in the United States, a package of regulatory reforms developed by the BCBS. The comprehensive reform package is designed to help ensure that banks maintain strong capital positions that will enable them to continue lending to creditworthy households and businesses even after unforeseen losses and during severe economic  downturns. This final rule increases both the quantity and quality of capital held by U.S. banking organizations. The board also published the Community Banking Organization Reference Guide, which is intended to help small, non-complex banking organizations navigate the final rule and identify the changes most relevant to them.

To date, RMA has provided the Basel Committee with a significant body of research outlining the economic capital allocation process, which is available in the Basel Archive.