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Tuesday, August 7, 2012

ABA Comments on OCC Lending Limits Proposal

ABA, with the Clearing House and the Financial Services Roundtable, filled a comment letter with the OCC regarding the interim final rule implementing Section 610 of the Dodd-Frank Act which would amend the statutory definition of “extensions of credit” for purposes of calculating the lending limit applicable to national banks and state and federal savings associations to include credit exposures arising from derivative and securities financing transactions.

The letter raises a number of discrete but important concerns the associations believe could have serious impacts on banks and could potentially result in market disruptions or reduced credit availability, if not resolved appropriately.
One of the most pressing concerns we have is the date by which banks must be in compliance with the Rule. Our concern is a function of the volume of work that will need to be done in order for banks to ensure implementation and compliance with the Rule and with other recent rulemakings…
The associations noted the need for additional clarification regarding internal models and implementation timelines, and requested the OCC coordinate with existing lending limit regulations.

Read the full letter.

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