The Institute of International Bankers and other financial trade associations submitted a joint comment letter urging the Federal Reserve to recalibrate internal total loss-absorbing capacity requirements for U.S. intermediate holding companies of global systemically important foreign banking organizations. The groups recommended reducing internal TLAC requirements for intermediate holding companies that are not resolution entities and eliminating the rule that requires a fixed portion of internal TLAC to be issued as long-term debt. Under the proposal, firms could meet internal TLAC requirements through a more flexible combination of eligible capital, eligible long-term debt and other qualifying internal instruments. The associations argued that these changes would better reflect firms’ risk profiles and resolution strategies, limit the trapping of capital and liquidity within U.S. entities, and support cross-border resolution planning while preserving orderly resolution and financial stability objectives. They also called for a broader review of the TLAC and long-term debt framework.
2026-08-11Institute of International Bankers
Institute of International Bankers recommends targeted recalibration of internal TLAC requirements for foreign bank holding companies
The Institute of International Bankers and other trade associations urged the Federal Reserve to reduce internal TLAC requirements for certain U.S. intermediate holding companies of global systemically important foreign banks. They also proposed removing the fixed long-term debt component and allowing firms more flexibility in the mix of eligible instruments used to meet the requirements.