eSLR, TLAC Recalibration
The Federal Reserve and OCC – but not the FDIC – have proposed sweeping changes to the enhanced supplementary leverage ratio (eSLR) imposed on global systemically-important banks (GSIBs) in the U.S. These GSIB changes would eliminate the fixed eSLR of six percent for national and state-member banks and five percent for BHCs in favor of a ratio linked to the risk-based results of the GSIB surcharge. The FRB’s total loss-absorbing capacity (TLAC) rules for U.S. GSIBs and intermediate holding companies (IHCs) with parent GSIBs3 would be reduced also to reduce leverage-related requirements to ensure complementarity with the new eSLR.