Voglio sapere a riguardo di…

Federal Register / Vol. 86, No. 188 / Friday, October 1, 2021 / Rules and Regulations c
4 Tier 1 leverage ratio. i A System institutions leverage ratio is the ratio of the institutions tier 1 capital to the institutions average total consolidated assets as reported on the institutions Call Report net of deductions and adjustments from tier 1 capital under 628.22a, b, and c and 628.23.
ii To calculate the measure of URE
and URE equivalents described in paragraph b4 of this section, a System institution must adjust URE and URE equivalents to reflect all the deductions and adjustments required under 628.22a, b, and c, and must use the denominator of the tier 1
leverage ratio.

13. Amend 628.20 by revising paragraphs b1i, ii, x, and xiv, c1xiv, d1i, d1viiiC, d1xi, and f5ii to read as follows:
628.20 Capital components and eligibility criteria for tier 1 and tier 2 capital instruments.

b
1
i The instrument is paid-in, issued directly by the System institution, and represents the most subordinated claim in a receivership, insolvency, liquidation, or similar proceeding of the System institution;
ii The holder of the instrument is entitled to a claim on the residual assets of the System institution after all senior claims have been satisfied in a receivership, insolvency, liquidation, or similar proceeding;

x The System institution, or an entity that the System institution controls, did not purchase or directly or indirectly fund the purchase of the instrument, except that where there is an obligation for a member of the institution to hold an instrument in order to receive a loan or service from the System institution, an amount of that loan equal to no more than $1,000
of the borrower stock requirement under section 4.3A of the Act will not be considered as a direct or indirect funding where:
A The purpose of the loan is not the purchase of capital instruments of the System institution providing the loan;
and B The purchase or acquisition of one or more member equities of the institution is necessary in order for the beneficiary of the loan to become a member of the System institution;

VerDate Sep<11>2014

16:40 Sep 30, 2021

Jkt 256001

xiv The System institutions capitalization bylaws, or a resolution adopted by its board of directors under 628.21, provides that the institution:
A Establishes a minimum redemption or revolvement period of 7
years for equities included in CET1; and B Shall not redeem, revolve, cancel, or remove any equities included in CET1 without prior approval of the FCA
under paragraph f of this section, except that the statutory borrower stock described in paragraph b1x of this section, not to exceed $1,000, may be redeemed without a minimum period outstanding after issuance and without the prior approval of the FCA, as long as after the redemption, the System institution continues to comply with all minimum regulatory capital requirements.

c
1
xiv The System institutions capitalization bylaws, or a resolution adopted by its board of directors under 628.21, provides that the institution:
A Establishes a minimum redemption or no-call period of 5 years for equities included in additional tier 1; and B Shall not redeem, revolve, cancel, or remove any equities included in additional tier 1 capital without prior approval of the FCA under paragraph f of this section.

d
1
i The instrument is issued and paidin;

viii
C The capital instruments are in excess of $1,000.

xi The System institutions capitalization bylaws, or a resolution adopted by its board of directors under 628.21, provides that the institution:
A Establishes a minimum call, redemption or revolvement period of 5
years for equities included in tier 2
capital; and B Shall not call, redeem, revolve, cancel, or remove any equities included in tier 2 capital without prior approval of the FCA under paragraph f of this section.

f
5
ii After such cash payments have been declared and defined by resolution of the board, the dollar amount of the System institutions CET1 capital at quarter-end equals or exceeds the dollar
PO 00000

Frm 00021

Fmt 4700

Sfmt 4700

54359

amount of CET1 capital on the same quarter-end in the previous calendar year; and

14. Add 628.21 to read as follows:
628.21 Capital bylaw or board resolution to include equities in tier 1 and tier 2
capital.

In order to include otherwise eligible purchased and allocated equities in tier 1 capital and tier 2 capital, the System institution must adopt a capitalization bylaw, or its board of directors must adopt a binding resolution, which resolution must be acknowledged by the board on an annual basis in the capital adequacy plan described in 615.5200, in which the institution undertakes the following, as applicable:
a The institution shall obtain prior FCA approval under 628.20f before:
1 Redeeming or revolving the equities included in common equity tier 1 CET1 capital;
2 Redeeming or calling the equities included in additional tier 1 capital; and 3 Redeeming, revolving, or calling instruments included in tier 2 capital other than limited life preferred stock or subordinated debt on the maturity date.
b The equities shall have a minimum redemption or revolvement period as follows:
1 7 years for equities included in CET1 capital, except that the statutory borrower stock described in 628.20b1x may be redeemed without a minimum holding period and that equities designated as unallocated retained earnings URE equivalents cannot be revolved without submitting a written request to the FCA for prior approval;
2 a minimum no-call, repurchase, or redemption period of 5 years for additional tier 1 capital; and 3 a minimum no-call, repurchase, redemption, or revolvement period of 5
years for tier 2 capital.
c The institution shall submit to FCA a written request for prior approval before:
1 Redesignating URE equivalents as equities that the institution may exercise its discretion to redeem other than upon dissolution or liquidation;
2 Removing equities or other instruments from CET1, additional tier 1, or tier 2 capital other than through repurchase, cancellation, redemption or revolvement; and 3 Redesignating equities included in one component of regulatory capital CET1 capital, additional tier 1 capital, or tier 2 capital for inclusion in another component of regulatory capital.
d The institution shall not exercise its discretion to revolve URE

E:FRFM01OCR1.SGM

01OCR1