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Highlights:
In the attached NPR, the agencies propose to
implement a new optional framework for calculating
risk-based capital based on the Basel II Standardized
Approach to credit risk and the Basel II Basic
Indicator Approach to operational risk. The proposal
would:
- Expand the use of credit ratings for determining risk weights,
- Base risk weights for residential mortgages on loan-to-value ratios,
- Expand the types of financial collateral and guarantees available to banks to offset credit risk,
- Offer more risk-sensitive approaches for recognizing the benefits of mitigating credit risk,
- Increase the risk weight for certain short-term commitments,
- Improve the risk sensitivity of the risk-based capital requirements for securitizations and equity investments, and
- Institute a risk-based capital requirement for operational risk.
The NPR includes a series of requests for comment
on the proposed implementation of the standardized
framework. The agencies are also withdrawing the
Basel 1A proposal issued on December 26, 2006.
Distribution:
FDIC-Supervised Banks (Commercial and Savings)
Suggested Routing:
Chief Executive Officer
Chief Financial Officer
Chief Accounting Officer
Related Topics:
Risk-Based Capital Rules
12 CFR Part 325
Basel II
Attachment:
Contact:
Nancy Hunt, Senior Policy Analyst, at
nhunt@fdic.gov or (202) 898-6643
Ryan D. Sheller, Capital Markets Specialist, at
rsheller@fdic.gov or (202) 898-6614
Printable Format:
FIL-69-2008 - PDF (PDF Help)
Note:
FDIC financial institution letters (FILs) may be
accessed from the FDIC's Web site at
www.fdic.gov/news/news/financial/2008/index.html.
To receive FILs electronically, please visit
http://www.fdic.gov/about/subscriptions/fil.html.
Paper copies of FDIC financial institution letters
may be obtained through the FDIC's Public
Information Center, 3501 Fairfax Drive, E-1002,
Arlington, VA 22226 (1-877-275-3342 or 703-
562-2200).
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