Dodd-Frank Act Summary on Bank Capital Requirements - First in Series

The Dodd-Frank Act requires some significant changes to capital requirements for banking organizations. Your company should evaluate these changes to determine the impact on your capital structure and capital needs.

Holding Companies Must Meet Bank Capital Standards on Consolidated Basis

The Act requires the federal regulators to establish consolidated capital requirements for any type of depository institution holding company (e.g., bank holding companies, thrift holding companies, financial holding companies, industrial loan holding companies) that are not less than the federal regulatory capital requirements for depository institutions. These requirements will include minimum leverage and risk-based capital standards. (See below regarding the impact of these standards on trust preferred securities ("TRUPS") used as capital.)