Regulatory News

A proposed rule, published June 21, 2023 in the Federal Register, implements the quality control standards mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) for the use of automated valuation models (AVMs) by mortgage originators and secondary market issuers. The proposed rule would require institutions that engage in covered transactions to adopt policies, practices, procedures, and control systems to ensure that AVMs adhere to quality control standards designed to ensure the credibility and integrity of valuations.  The deadline for public comment is August 21, 2023.

Final guidance, published June 9, 2023 in the Federal Register, describes principles and considerations for banking organizations' risk management of third-party relationships, including relationships with financial technology companies. The final guidance covers risk management practices for the stages in the life cycle of third-party relationships: planning, due diligence and third-party selection, contract negotiation, ongoing monitoring, and termination. The guidance is final as of June 6, 2023.

A final rule, published January 26, 2023 in the Federal Register, implements the Adjustable Interest Rate (LIBOR) Act by identifying benchmark rates based on SOFR (Secured Overnight Financing Rate) that will replace LIBOR in certain financial contracts after June 30, 2023. The final rule is substantially similar to the proposal with clarifying changes in response to comments.  The final rule is effective February 27, 2023. 

A notice, published December 27, 2022 in the Federal Register, makes technical updates to the Federal Reserve Board’s policy governing the provision of intraday credit in accounts at Reserve Banks to accommodate enhancements to the Automated Claim Adjustment Process. The updates streamline the settlement process and shorten the time needed for debits and credits to settle.  The policy changes are effective January 30, 2023.

A notice, published December 19, 2022 in the Federal Register, extends the comment period on an advance notice of proposed rulemaking to enhance regulators' ability to resolve large banks in an orderly way should they fail.  The advance notice of proposed rulemaking, originally published in the Federal Register October 24, 2022, asks for comment on several potential new requirements and resources that could be used for an orderly resolution of large banking organizations, including a long-term debt requirement.  The new deadline for public comment is January 23, 2023.

A notice and request for comment, published December 8, 2022 in the Federal Register, requests feedback on proposed principles providing a high-level framework for the safe and sound management of exposures to climate-related financial risks for large banking organizations. The draft principles are intended to support efforts by large financial institutions to focus on key aspects of climate-related financial risk management.  The deadline for public comment is February 6, 2023.

A notice, published December 8, 2022 in the Federal Register, finalizes clarifying and technical updates to the Federal Reserve policy governing the provision of intraday credit. The updates expand access to collateralized intraday credit, clarify requirements for uncollateralized intraday credit, reduce administrative requirements, and support the launch of the FedNow℠ Service.  FedNow℠ Service and Overnight Drafts policy related changes are effective when Reserve Banks begin processing live transactions for FedNow℠ Service participants.  The remaining changes are effective February 6, 2023.

A notice and request for comment, published November 16, 2022 in the Federal Register, seeks feedback on proposed amendments to its Guidelines for Evaluating Account and Services Requests that would require the Federal Reserve Banks to publish a periodic list of depository institutions with access to Reserve Bank accounts and/or financial services. The deadline for public comment is effective January 17, 2023.

An advance notice of proposed rulemaking, published October 24, 2022 in the Federal Register, solicits public comment on potential changes that would enhance regulators' ability to resolve large banks in an orderly way should they fail.  The advance notice of proposed rulemaking asks for comment on several potential new requirements and resources that could be used for an orderly resolution of these large banking organizations, including a long-term debt requirement. The deadline for public comment is December 23, 2022.

A final rule, published October 11, 2022 in the Federal Register, amends Regulation II, concerning debit card transactions.  The final rule specifies that debit card issuers should enable at least two payment card networks to process all debit card transactions, including "card-not-present" transactions, such as online payments, and clarifies certain terminology.  The final rule is substantially similar to the proposal, published May 13, 2021 in the Federal Register. The final rule is effective July 1, 2023.