News Release 2016-50 | April 26, 2016
Comptroller Statement Regarding the Proposed Net Stable Funding Rule
WASHINGTON—Comptroller of the Currency Thomas J. Curry today made the following statement at a board meeting of the Federal Deposit Insurance Corporation (FDIC) on his vote approving the proposed Net Stable Funding Rule. The Comptroller also signed the proposed rule on behalf of the Office of the Comptroller of the Currency (OCC).
Thank you, Mr. Chairman.
I'd like to start by thanking the staff of all three agencies for the work they've done to develop this proposal, which would set new funding standards for our largest institutions. The cooperative effort behind this rulemaking reflects the kind of collaboration among regulators that can enhance the system’s safety and soundness.
I am pleased to vote in favor of publishing the proposed rule for notice and comment.
This rule will help ensure that an institution’s funding is adequate to support its activities, and the proposed rule will work in concert with the Liquidity Coverage Ratio (or LCR) rule issued in September 2014. The liquidity rule requires covered institutions to hold high-quality liquid assets equal to their net cash outflows over a 30-day period. The proposed Net Stable Funding Ratio rule would further reduce the probability that covered institutions will encounter funding stress by requiring covered institutions to have sources of funding that are stable over a one-year period.
Like the liquidity rule, the proposed rule would cover depository institutions with more than $250 billion in total consolidated assets or $10 billion in foreign exposure and would also cover depository institutions with more than $10 billion in total consolidated assets that are subsidiaries of large holding companies, large depository institutions, or certain FSOC-designated non-bank firms.
The proposed Net Stable Funding Ratio rule is one piece of a broader effort to increase the resiliency of the banking system and complements the liquidity rule, the agencies’ enhanced capital standards, and the OCC’s robust bank supervision.
I look forward to receiving public comment on the proposal.