LRA Updates

REGULATORY DEVELOPMENTS Banking Regulators Remove References to Reputation Risk from Interagency Guidance On June 2 the banking regulators reissued 15 interagency guidance documents to remove references to reputation risk (OCC Bulletin 2026-23) (FDIC FIL-27-2026). The Interagency Statement on the Purchase and Risk Management of Life Insurance (commonly cited as OCC 2004-56) was included in the…

LEGISLATIVE DEVELOPMENT Louisiana Proposed Legislation for BOLI 1035 Exchanges – Update Last month, we described proposed legislation in Louisiana addressing banks’ rights to execute 1035 exchanges on policies covering former employees (SB 509). We had concerns with the proposal and engaged in outreach to try to improve the legislation. Our outreach included discussions and correspondence…

LEGISLATIVE DEVELOPMENTS Louisiana Proposed Legislation for BOLI 1035 Exchange A bill has been introduced in the Louisiana state senate (SB 509) that is directed toward BOLI exchanges – particularly exchanges of policies covering former employees. While we support the bill’s aim of clarifying that exchanges of policies covering former employees are permissible, as drafted, the…

REGULATORY DEVELOPMENTS Basel III Endgame – Regulators Release Proposed Regulatory Capital Rules As identified in our March 20 Ad Hoc LRA Update, the FDIC, Federal Reserve Board, and the OCC jointly announced the release of three separate regulatory capital rule proposals concerning the following: The proposals are open for comment until June 18. We have…

REGULATORY DEVELOPMENTS Basel III Endgame – Regulators Release Proposed Regulatory Capital Rules As has been well reported, federal banking regulators have long been considering a re-proposal of the previously released regulatory capital rules known as Basel III Endgame. On March 19 the FDIC, Federal Reserve Board, and the OCC jointly announced the release of three…

REGULATORY DEVELOPMENTS Basel III Endgame – Update Federal regulators continue to indicate that work is being done to revisit the previously proposed capital rules known as Basel III Endgame. FRB Vice Chair for Supervision Michelle Bowman recently gave remarks at an Exchequer Club event discussing the timeline for re-proposed capital rules. Bowman stated that “I’ve…

LEGISLATIVE DEVELOPMENT Florida Bill to Restrict Employer-Owned Life Insurance – Update As covered in a previous LRA Update, a Florida Assembly member had introduced legislation intended to place restrictions on employer-owned life insurance. The restrictions would include requiring an employer to provide written notice of a policy to the insured’s spouse and/or estate within 30…

REGULATORY DEVELOPMENT Basel III Endgame – Update As covered in a previous LRA Update, there has been reporting that the federal banking regulators are planning to revisit the previously proposed capital rules referred to as Basel III Endgame. The re-proposal is expected to include lower aggregate capital increases compared to the original proposal. The banking…

LEGISLATIVE DEVELOPMENT Florida Bill to Restrict Employer-Owned Life Insurance On October 27 a Florida Assemblymember, Peggy Gossett-Seidman (R), filed House Bill 261, titled Restrictions on Employer-Owned Life Insurance. As drafted, this legislation is adverse to BOLI/COLI in the state of Florida. Among others, the bill includes the following restrictions: In discussions with insurers, we have…

REGULATORY DEVELOPMENTS Basel III Endgame – Update In October it was reported that the Federal Reserve is planning to revisit the previously proposed capital rules commonly referred to as Basel III Endgame. As we reported in our July 2024 and September 2024 LRA Updates, certain leadership at the FDIC and FRB had already recommended that…