Federal Regulators Propose a Community Bank Leverage Ratio Capital Framework for Community Banks with Less Than $10 Billion in Assets

December 21, 2018

On November 21, 2018, the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation (the “Federal Agencies”) jointly issued a proposed rule to simplify the regulatory capital requirements for eligible community banks and holding companies, as required by Section 201 of the Economic Growth, Regulatory Relief and Consumer Protection Act.

Under the proposed rule, community banks and holding companies that have less than $10 billion in consolidated assets, that meet risk-based qualifying criteria and have a tangible equity ratio (referred to as the “community bank leverage ratio”) greater than 9% would be eligible to opt into a community bank leverage ratio framework. If this election is made, the qualifying community bank or holding company would satisfy its regulatory capital standards by calculating and reporting the community bank leverage ratio instead of the risk-weighted capital ratios and minimum leverage ratio currently required, and would be deemed “well capitalized” under the Federal Agencies’ prompt corrective action framework.

For more information, including a summary of the proposed rule, please see the attached News Alert.


Luse Gorman is Legal Counsel to BSB Bancorp, Inc. in its Proposed Merger with People’s United Financial, Inc.

November 27, 2018

On November 27, 2018, BSB Bancorp, Inc., Belmont, Massachusetts, the holding company for Belmont Savings Bank, and People’s United Financial, Inc., Bridgeport, Connecticut, the holding company for People’s United Bank, announced a definitive merger agreement pursuant to which BSB Bancorp will merge with and into People’s United, with People’s United as the resulting company.


Jeff Cardone presented at The Bonadio Group and M&T Bank 2018 Financial Institutions Seminar

November 15, 2018

On Thursday, November 8, 2018, Jeff Cardone gave a presentation on “The Financial Regulatory Environment and Other Hot Topics Impacting Community Banks” at The Bonadio Group and M&T Bank 2018 Financial Institutions Seminar in Syracuse, NY. The presentation focused on the current trends in community banking, including discussions about the Economic Growth, Regulatory Relief and Consumer Protection Act (S.2155), mergers and acquisitions and the pros and cons of a holding company.