MBA supports Simplified Regulatory Capital Rules Calculations for Small Community Banks.
Overview: In 2018, Congress enacted the regulatory burden relief statute, under which Section 201 provides a simplified process of regulatory capital calculation for small community banks that meet certain enumerated requirements. In effect, Section 201 creates a CBLR framework, which if opted into by an eligible community bank, would allow the bank avoid complex regulatory capital calculations under the normal capital rules. Congress charged the agencies with the task of issuing guidance to implement Section 201. In February 2019, the agencies released proposed rules on the CBLR framework. MBA submitted comments on the proposed rules, specifically objecting to the inclusion of a less than 25% MSA threshold requirement for eligibility. This requirement would work against the goal and intent of providing simplification for the smallest community banks by excluding such banks simply because their MSAs exceed 25% of tier 1 capital. MBA will continue to actively advocate for less onerous requirements so that more community banks would qualify for this simplified CBLR framework, as intended by Congress.
Recent MBA Activity Related to ATR/QM Improvements
- Comment Letter: MBA to Agencies on Thresholds for Regulatory Capital and Liquidity Requirements (January 22, 2019)
- Joint Trades Letter: MBA and ICBA to Agencices Requesting Meeting on Proposed Simplifications to Capital Rule Proposal (December 18,2018)
- Letter: MBA to Agencies on Simplification of Capital Rule (July 24, 2018)