Federal banking agencies today announced a regulatory capital estimation tool to assist community bankers and other interested parties evaluate recently published regulatory capital proposals, a release on the Federal Reserve Web site said.
These agencies include the Federal Reserve Board, the Federal Deposit Insurance Corp., and the Office of the Comptroller of the Currency.
The new tool will help in projecting the potential impact on the banks' capital ratios based on the agencies' Basel III Notice of Proposed Rulemaking (NPR) and Standardized Approach NPR.
In June 2012, the three regulatory agencies approved joint proposals for comment revising their current regulatory capital standards. The public comment period for these proposals ends Oct. 22.
The Basel III NPR mostly strengthens regulatory capital requirements and improves the quality of capital.
Meanwhile, the Standardized Approach NPR proposes various enhancements to the risk-sensitivity of the agencies' capital standards.
The tool is meant to help institutions estimate the potential effect the proposals can have on their capital ratios, the release said.
The release said that i should not be used as an indicator of an institution's actual regulatory capital ratios and is not part of the NPRs nor any final rule that the agencies might adopt.
The estimation tool is available for banks and savings associations Fed's Web site..