Quiero saber acerca de...

lotter on DSK11XQN23PROD with PROPOSALS2

Federal Register / Vol. 86, No. 155 / Monday, August 16, 2021 / Proposed Rules weighting of zero percent to an obligation of the Bank for International Settlements, the European Central Bank, the European Commission, the International Monetary Fund, the European Stability Mechanism, the European Financial Stability Facility, and multilateral development banks MDBs. The 2015 Final Rule did not specifically discuss MDBs, which would have a risk weight of 100 percent under the catchall category for all other assets not specifically assigned a risk weight.116 Assigning a risk-weight of zero percent is consistent with the other banking agencies risk-based capital rule and the Board believes the zero percent risk weight is appropriate due to the generally high-credit quality of the issuers. This proposed change to the risk-based capital risk weighting was also requested in a comment letter in the ANPR. As part of this change, the Board would add a definition listing MDBs and criteria for non-listed multilateral lending institutions or regional development banks to be included in the MDB category. The MDBs listed in the definition are:
International Bank for Reconstruction and Development;
Multilateral Investment Guarantee Agency;
International Finance Corporation;
Inter-American Development Bank;
Asian Development Bank;
African Development Bank;
European Bank for Reconstruction and Development;
European Investment Bank;
European Investment Fund;
Nordic Investment Bank;
Caribbean Development Bank;
Islamic Development Bank; and Council of Europe Development Bank.
Multilateral lending institution or regional development bank in which the U.S. government is a shareholder or contributing member are also included in the definition of MDBs.
Furthermore, the Board notes that MDBs are not permissible investments for FCUs under the general investment authorities. However, FCUs may invest in MDBs under 701.19 and under 721.3b, subject to some conditions.
Question 20: Are there any supranational entities that should be included in the zero percent risk weight category? Specifically, the Board is requesting whether this proposed change sufficiently aligns NCUAs riskweightings with the other banking agencies risk weights for supranational organizations and MDBs.
116 12 CFR 702.104c2vC effective Jan. 1, 2022.

VerDate Sep<11>2014

18:24 Aug 13, 2021

Jkt 253001

5. Paycheck Protection Program Loans As discussed previously in connection with the other banking agencies CBLR regulation, the CARES
Act was enacted in 2020 to provide aid to the U.S. economy during the COVID
19 pandemic.117 The CARES Act authorized the Small Business Administration SBA to create a loan guarantee program, the Paycheck Protection Program PPP, to help certain affected businesses meet payroll needs and utilities including employee salaries, sick leave, other paid leave, and health insurance expenses as a result of the COVID19 pandemic.
Provided credit union lenders comply with the applicable lender obligations set forth in the SBAs interim final rule, the SBA fully guaranteed loans issued under the PPP. Most FICUs were eligible to make PPP loans to members. Under the CARES Act, PPP loans must receive a zero percent risk weighting under the NCUAs risk-based capital requirements.118 The NCUA issued a 2020 interim final rule to explicitly state that PPP loans under the risk-based net worth requirement receive a zero percent risk-weight.119 The 2020 interim final rule stated that the NCUAs riskbased capital regulations would be amended in the future. The Board is now proposing to update the 2015 Final Rule to reflect that PPP loans receive a zero percent risk weight.
6. Updates to Derivative-Related Definitions The Board recently amended its rule on derivatives to modernize the rule and make it more principles-based, while retaining key safety and soundness components.120 The rulemaking amended several defined terms. A few of those defined terms are also included in the 2015 Final Rule. For consistency, the proposed rule would update those definitions that are also included in the 2015 Final Rule. First, under the proposed rule, the term derivative would be defined as a financial contract that derives its value from the value and performance of some other underlying financial instrument or variable, such as an index or interest rate. 121 Second the proposed rule 117 Public 118 Public
Law 116136 Mar. 27, 2020.
Law 116136, 134 Stat. 281 Mar. 27,
2020.
119 85 FR 23212 Apr. 27, 2020.
120 85 FR 23212 Apr. 27, 2020.
121 The 2015 Final Rule defines a derivative contract as a financial contract whose value is derived from the values of one or more underlying assets, reference rates, or indices of asset values or reference rates. Derivative contracts include interest rate derivative contracts, exchange rate derivative contracts, equity derivative contracts, commodity
PO 00000

Frm 00025

Fmt 4701

Sfmt 4702

45847

would make minor changes to the definitions of a derivative clearing organization and swap dealer by including a more general reference to the Commodity Futures Trading Commission CFTCs regulations for both definitions, the 2015 Final Rule references the definitions used by the CFTC.122
7. Definitions of Consumer Loan and Current The Board is proposing to amend the definitions for Consumer Loan and Current in 702.2. The Board is proposing these changes as a clarification to the 2015 Final Rule. The 2015 Final Rule does not include leases in the definition in Consumer Loan, despite the fact that the 2014 Risk-Based Capital NPR stated consumer loans unsecured credit card loans, lines of credit, automobile loans, and leases are generally highly desired credit union assets and a key element of providing basic financial services. 123 The Board is providing this proposed change for clarity. Without this proposed change the treatment of consumer leases is unclear and, therefore, may be risk weighted in the catchall category of 100
percent. The change makes clear that consumer leases receive a 75 percent risk weight. Due to the proposed change in the definition of a consumer loan, the definition of current will also be amended for consistency and would include the term leases.
N. Technical Amendments The proposed rule would also include two technical amendments to 12 CFR
part 703. Both amendments would make minor corrections related to the 2015
Final Rule.
O. Illustrative Reporting Forms for RiskBased Capital In January 2018, the Board issued a Request for Comment RFI seeking comments on all proposed changes to the Call Report form 5300, the Profile derivative contracts, and credit derivative contracts.
Derivative contracts also include unsettled securities, commodities, and foreign exchange transactions with a contractual settlement or delivery lag that is longer than the lesser of the market standard for the particular instrument or five business days. 12 CFR 702.2 effective Jan. 1, 2022.
122 The 2015 Final Rule states a derivative clearing organization is as defined by the Commodity Futures Trading Commission in 17 CFR
1.3d. The proposed rule would state that a derivative clearing organization as defined by the Commodity Futures Trading Commission CFTC in 17 CFR 1.3. Essentially the proposed rule would remove the d. Similarly, the more specific reference in the 2015 Final Rule would be updated with the more general reference included in the recent derivative rule.
123 79 FR 11184, 11198 Feb. 27, 2014.

E:FRFM16AUP2.SGM

16AUP2