US Basel III Framework
The US Basel III capital rules came into force on 01 January 2014, with the US Basel III liquidity rules effective from 01 January 2015. In general, the Basel III framework applies to banks in US with total assets more than $500 million. Compared to US implementation of Basel I and Basel II, the Basel III framework adopted by Federal Reserve introduced stricter regulation with more reporting requirements on banks’ risk weighted capital, liquidity, leverage ratio and others. Lombard Risk AgileREPORTER delivers these requirements.
Since the global financial crisis, regulators have required more regulatory reporting requirements with increased granularity, complexity and frequency. Most US banks and savings & loan holding companies and foreign banking holding companies are required to submit reporting such as Call Reports, FRY9C, FRY11, FRY15, FRY16, FR 2052a and others. Advanced approach banks need to submit additional reports such as FFIEC101 and FFIEC 102 returns. Lombard Risk AgileREPORTER delivers these requirements.
The Basel III capital final rules and the associated reporting requirements apply the advanced approaches for the largest globally active US banks and a standardized approach applies to all banking organizations except small bank holding companies under $500 million in assets. Key capital requirements including:
- All banking organizations covered by US Basel III need to hold 4.5 percent CET1, 6% Tier 1 Capital, and 8% Total Capital
- All banking organizations are required to maintain a capital conservation buffer consisting of 2.5 % CET1 capital by 2019 with a phase-in period prior
- All US banking organizations are subject to a 3% minimum Leverage requirement. An additional 3% Supplementary Leverage Ratio applies to advanced approaches US bank banking organisations including US IHCs of foreign banks which are subject to advanced approaches.
For liquidity, the US Federal Reserve adopted a two-tiered framework. Largest banking organizations with assets of $250 billion or more are subject to Liquidity Coverage Ratio, while banks with assets between $50 billion and $250 billion are subject to modified LCR. The FR2052 returns capture more granular data to monitor banks’ liquidity performance.
Beside the Basel III framework, US banks are subject to various other complex regulatory requirements such as The Fed’s annual Comprehensive Capital Analysis and Review (CCAR) and Dodd-Frank Act Enhanced Prudential Standards (EPS). Lombard Risk AgileREPORTER includes extensive coverage of US banking reports and supports the frequent movement of extremely high volumes of complex data, creating and validating the XML, XBRL and other transmission for reports filing to US Federal Reserve, Treasury, FFIEC and other agencies.
Lombard Risk AgileREPORTER US reporting:
- Support for Federal Reserve, Treasury and Commerce requirements with various submission methods including XML, XBRL etc.
- Ongoing maintenance & implementation ensuring you are always up to date
- Delivers embedded regulatory reporting production process, reducing risk
- Ensures management has a comprehensive view of reporting status, trends & change analysis
- Delivers single solution for end-to-end reporting with streamlined workflow & exception management