Adjusting the Calculations for Credit Concentration

Financial Institution Letter

March 30, 2020

Adjusting the Calculations for Credit Concentration


The FDIC, Board of Governors of the Federal Reserve, and Office of the Comptroller of the Currency (the Agencies) are jointly adjusting their calculation for credit concentration ratios used in the supervisory process.  The adjustment is in response to changes in the capital information available after the implementation of the Community Bank Leverage Ratio (CBLR) rule.  Effective March 31, 2020, for supervisory purposes, examiners will calculate credit concentration ratios using tier 1 capital plus the appropriate allowance for loan and lease losses or the allowance for credit losses attributed to loans and leases (as applicable) for the denominator.

Statement of Applicability to Institutions under $1 Billion in Total Assets:

This Financial Institution Letter (FIL) applies to all FDIC-supervised institutions that are eligible to elect CBLR.


FDIC-Supervised Banks

Read the FIL


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