Agencies Finalize Changes to Community Bank Leverage Ratio | OCC

https://www2.occ.gov/news-issuances/news-releases/2026/nr-ia-2026-30.html
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2026-05-04 13:41:12 · pdonofrio@vixio.com
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The federal bank regulatory agencies today jointly finalized a rule to modify the community bank leverage ratio consistent with existing statutory authority. This change will provide community banks with greater flexibility to use a simpler measure of capital adequacy and reduce regulatory burden.

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TITLE: United States Agencies Finalize Changes to Community Bank Leverage Ratio BODY: On April 23, 2026, the Office of the Comptroller of the Currency (OCC), Federal Deposit Insurance Corporation (FDIC), and Federal Reserve Board jointly finalized a rule modifying the community bank leverage ratio framework. The final rule was adopted without change from the proposal issued in November 2025. The rule reduces the community bank leverage ratio requirement from nine percent to eight percent, providing community banks with greater flexibility to opt into the simplified capital adequacy framework. The change takes into account the unique business models and risk profiles of community banks and aims to reduce regulatory burden. Additionally, the final rule extends the grace period from two quarters to four quarters for community banks that temporarily fall out of compliance with the framework requirements. The framework allows community banks to adopt a relatively simple leverage ratio to measure capital adequacy, rather than calculating and reporting risk-based capital ratios. Community banks that opt into the framework must maintain a leverage ratio that is significantly higher than the leverage ratio standard otherwise applicable to community banks, ensuring continued promotion of safety and soundness within the banking system. The changes take effect on July 1, 2026. Community banks should review the final rule to determine whether adopting the modified framework aligns with their operational and capital management strategies. **References:** Office of the Comptroller of the Currency Newsroom, News Release 2026-30 (April 23, 2026): https://www.occ.gov/news-issuances/news-releases/2026/nr-occ-2026-30.html
  • ✓ Scraped:2026-05-04 13:41:12
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  • ✓ By:pdonofrio@vixio.com (38)