In this report, we build on our in-depth analysis of the FRB’s newly-finalized CCAR framework to go into more detail on the specifics of the 2017 round released on Friday. Our in-depth analysis describes which BHCs and IHCs are now exempt from qualitative review, and we here expand on our initial assessment of the quantitative requirements released on Friday covering all BHCs and IHCs with assets over $50 billion. This report provides additional analysis of the process the Board will use in 2017 for all filing firms as well as the qualitative approach it will take to intermediate holding companies of foreign banks filing for the first time. Several of the model changes – particularly those related to prior earnings – could prove material and give better performing companies an edge towards higher capital distributions in 2017 even as BHCs with weaker earnings see their quantitative standards grow still more stringent.
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