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Federal R eserve Bank
OF DALLAS
ROBERT

D. M C T E E R , J R .

p re s id e n t

F p h fll^rV

re o ru a ry

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10, iy y o

A N D C H IE F E X E C U T I V E O F F I C E R

d a lla s , te x a s

7 5 2 6 5 -5 9 0 6

Notice 96-20

TO:

The Chief Executive Officer of each
member bank and bank holding company
in the Eleventh Federal Reserve District
SUBJECT
Joint Final Rules Amending the
Risk-based Capital Standards
DETAILS

The Office of the Comptroller of the Currency, the Board of Governors of
the Federal Reserve System, and the Federal Deposit Insurance Corporation have
amended their respective risk-based capital guidelines to modify the definition of the
Organization for Economic Cooperation and Development-based (OECD) group of
countries.
The amendment excludes from the OECD-based group of countries any
country that has rescheduled its external sovereign debt within the previous five years. It
also clarifies that the OECD-based group of countries includes all countries that are
members of the OECD, regardless of their date of entry into the OECD.
ATTACHMENT
A copy of the Board’s notice as it appears on pages 66042-45, Vol. 60, No.
244, of the Federal Register dated December 20, 1995, is attached.
MORE INFORMATION
For more information, please contact Dorsey Davis at (214) 922-6051. For
additional copies of this Bank’s notice, please contact the Public Affairs Department at
(214) 922-5254.
Sincerely yours,

For additional copies, bankets and others are encouraged to use one of the following toll-free numbers in contacting the Federal
Reserve Bank of Dallas: Dallas Office (800) 333 -4460; El Paso Branch Intrastate (800) 592-1631, Interstate (800) 351-1012; Houston
Branch Intrastate (800) 392-4162, Interstate (800) 221-0363; San Antonio Branch Intrastate (800) 292-5810.

This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)

66042 Federal Register / Vol. 60, No. 244 / Wednesday, December 20, 1995 / Rules and Regulations
DEPARTMENT OF THE TREASURY
Office of the Comptroller of the
Currency
12 CFR Part 3
[Docket No. 9 5 -2 8 ]
RIN 1557-AB14

FEDERAL RESERVE SYSTEM
12 CFR Parts 208 and 225
[Regulations H and Y; Docket No. R-0849]

FEDERAL DEPOSIT INSURANCE
CORPORATION
12 CFR Part 325
RIN 3064-AB54

Capital; Capital Adequacy Guidelines

Office of the Comptroller of
the Currency (OCC), Treasury; Board of
Governors of the Federal Reserve
System (Board); and Federal Deposit
Insurance Corporation (FDIC).
ACTION: Joint final rule.

AGENCIES:

The OCC, Board, and the
FDIC (Agencies) are amending their
respective risk-based capital guidelines
to modify the definition of the OECDbased group of countries. The
amendment excludes from the OECDbased group of countries any country
that has rescheduled its external
sovereign debt w ithin the previous five
years. The am endm ent also clarifies that
the OECD-based group of countries
includes all countries that are members
of the OECD, regardless of their date of
entry into the OECD. The effect of the
amendment would be to increase the
amount of capital that banks are
required to hold against claims on the
governments and banks of an OECD
country, in the event that the country
were to reschedule its external
sovereign debt. This action is being
taken to conform w ith a change in the
Basle Accord on risk-based capital that
was adopted by the Basle Committee on
Banking Supervision (Basle Committee)
on April 15, 1995.
EFFECTIVE DATE: April 1, 1996.
SUMMARY:

FOR FURTHER INFORMATION CONTACT:

OCC: Geoffrey White, Senior
International Economic Advisor,
International Banking and Finance
Department, (202) 874-5235; Saumya
Bhavsar, Attorney, Legislative and
Regulatory Activities Division, (202)
874-5090; Ronald Shimabukuro, Senior
Attorney, Legislative and Regulatory
Activities Division, (202) 874-5090; or
Roger Tufts, Senior Economic Advisor,

Office of the Chief National Bank
Examiner, (202) 874-5070; Office of the
Comptroller of the Currency, 250 E
Street, SW., Washington, DC 20219.
Board: Roger Cole, Deputy Associate
Director, (202) 452-2618; Norah Barger,
Manager, (202) 452-2402; Robert
Motyka, Supervisory Financial Analyst,
(202) 452-3621; Division of Banking
Supervision and Regulation; or Greg
Baer, Managing Senior Counsel, Legal
Division, (202) 452-3236; Board of
Governors of the Federal Reserve
System, 20th Street and Constitution
Avenue, NW„ Washington, DC 20551.
For the hearing impaired only,
Telecommunication Device for the Deaf,
Dorothea Thompson, (202) 452-3544.
FDIC: For supervisory purposes,
Stephen G. Pfeifer, Examination
Specialist, Accounting Section, Division
of Supervision, (202) 898-8904; for legal
purposes, Dirck A. Hargraves, Attorney,
Legal Division, (202) 898-7049; Federal
Deposit Insurance Corporation, 550 17th
Street, NW., Washington, DC 20429.
SUPPLEMENTARY INFORMATION:

I. Background
In 1988, the central bank governors of
the Group of Ten (G-10) countries
endorsed a framework for international
risk-based capital guidelines entitled
“International Convergence of Capital
Measurement and Capital Standards”
(commonly referred to as the Basle
Accord).1 Under the framework, riskweighted assets are calculated by
assigning assets and off-balance-sheet
items to broad categories based
primarily on their credit risk: that is, the
risk that a banking organization will
incur a loss due to an obligor or
counterparty default on a transaction.
Risk weights range from zero percent,
for assets with minimal credit risk (such
as U.S. Treasury securities), to 100
percent, which is the risk weight that
applies to most private sector claims,
including commercial loans. In 1989,
the Agencies adopted risk-based capital
guidelines implementing the Basle
Accord for the banking organizations
they supervise.
. While the Basle Accord focuses
primarily on credit risk, it also
incorporates country transfer risk
considerations. Transfer risk generally
refers to the possibility that an asset
cannot be serviced in the currency of
payment because of a lack of, or
restraints on, the availability of needed
1 The Basle Accord was proposed by the Basle
Committee, which comprises representatives of the
central banks and supervisory authorities from the
G-10 countries (Belgium, Canada, France, Germany,
Italy, Japan, the Netherlands,"Sweden, Switzerland,
the United Kingdom, and the United States) and,
Luxembourg.

foreign exchange in the country of the
obligor.
In addressing transfer risk, the Basle
Committee members examined several
methods for assigning obligations of
foreign countries to the various risk
categories. Ultimately, the Basle
Committee decided to use a defined
group of countries considered to be of
high credit standing as the basis for
differentiating claims on foreign
governments and banks. For this
purpose, the Basle Committee
determined this group to be the full
members of the Organization for
Economic Cooperation and
Development (OECD), as well as
countries that have concluded special
lending arrangements with the
International Monetary Fund (IMF)
associated with the IMF’s General
Arrangements to Borrow.2 These
countries, referred to in the Agencies’
risk-based capital guidelines as the
OECD-based group of countries,
encompass most of the w orld’s major
industrial countries, including all
members of the G-10 and the European
Union.
Under both the Basle Accord and the
Agencies’ risk-based capital guidelines,
claims on the governments and banks of
the OECD-based group of countries
generally receive lower risk weights
than corresponding claims on the
governments and banks of non-OECD
countries. Specifically, the Agencies’
guidelines provide for the following
treatment:
• Direct claims on, and the portions
of claims that are directly and
unconditionally guaranteed by, OECDbased central governments (including
central banks) are assigned to the zero
percent risk weight category.
Corresponding claims on the central
government of a country outside the
OECD-based group are assigned to the
zero percent risk weight category only to
the extent that the claims are
denominated in the local currency iand
the bank has local currency liabilities in
that country.
• Claims conditionally guaranteed by
OECD-based central governments and
2 The OECD is an international organization of
countries which are committed to m arket-oriented
economic policies, including the promotion of
private enterprise and free market prices; liberal
trade policies; and the absence of exchange
controls. Full members of the OECD at the time the
Basle Accord was endorsed included Australia,
Austria, Belgium, Canada, Denmark, Finland,
France, Germany, Greece, Iceland, Ireland, Italy,
Japan, Luxembourg, the Netherlands, New Zealand,
Norway, Portugal, Spain, Sweden, Switzerland,
Turkey, the United Kingdom, and the United States.
In May 1994, Mexico was accepted as a full member
of the OECD. In addition, Saudi Arabia has
concluded special lending arrangements associated
w ith the IMF’s General Arrangements to Borrow.

Federal Register / Vol. 60, No. 244 / Wednesday, December 20, 1995 / Rules and Regulations 66043
claims collateralized by securities
issued or guaranteed by OECD-based
central governments generally are
assigned to the 20 percent risk weight
category. The same types of claims on
non-OECD countries are assigned to the
100 percent risk category.
• Long-term claims on non-OECD
banks are assigned to the 100 percent
risk category, rather than to the 20
percent risk category accorded to long­
term claims on OECD banks. (Short-term
claims on all banks are assigned to the
20 percent risk weight category.)
• General obligation bonds that are
obligations of states or other political
subdivisions of the OECD-based group
of countries are assigned to the 20
percent risk category. Revenue bonds of
such political subdivisions are assigned
to the 50 percent risk category. General
obligation and revenue bonds of
political subdivisions of non-OECD
countries are assigned to the 100
percent risk category.
Recently, the OECD has taken steps to
expand its membership. In light of these
steps, the Basle Committee was urged to
clarify an ambiguity in the Basle Accord
as to whether the OECD members
qualifying for the lower risk weights
include only those members that were
members of the OECD when the Basle
Accord was endorsed in 1988, or all
members, regardless of their date of
entry into the OECD. The Basle
Committee also reviewed the overall
appropriateness of the criteria the Basle
Accord uses to determine whether
claims on a foreign government or bank
qualify for placement in a lower risk
category. As part of this review, the
Basle Committee reassessed whether
membership in the OECD (or the
conclusion of special lending
arrangements with the IMF) would, by
itself, be sufficient to ensure that only
countries with relatively low transfer
risk would qualify for lower risk weight
treatment.
On July 15,1994, the Basle Committee
clarified that the reference in the Basle
Accord to OECD members applies to all
current members of the organization.
The Basle Committee also stated its
intention, subject to national
consultation, to amend the definition of
the OECD-based group of countries in
the Basle Accord in order to exclude
from lower risk weight treatment any
country within the OECD-based group
of countries that had rescheduled its
external sovereign debt within the
previous five years. The Basle
Committee adopted this change in the
definition of the OECD-based group of
countries on April 15,1995.
On October 14,1994, the Board and
the OCC published a joint notice of

proposed rulemaking (59 FR 52100) to
make corresponding changes in the
definition of the OECD-based group of
countries in their risk-based capital
guidelines. The FDIC published a
similar proposal on February 15,1995
(60 FR 8582). Under the Agencies’
proposals, the OECD-based group of
countries would continue to include
countries that are full members of the
OECD, regardless of entry date, as well
as countries that have concluded special
lending arrangements with the IMF
associated with the IMF’s General
Arrangements to Borrow, but would
exclude any country w ithin this group
that had rescheduled its external
sovereign debt within the previous five
years. The purpose of the proposed
modification was to clarify that
membership in the OECD-based group
of countries must coincide with
relatively low transfer risk in order for
a country to qualify for the lower riskweight treatment.
Under the proposals, reschedulings of
external sovereign debt generally would
include renegotiations of terms arising
from a country’s inability or
unwillingness to meet its external debt
service obligations. The proposals
further provided that renegotiations of
debt in the normal course of business
generally would not indicate transfer
risk of the kind that would preclude an
OECD-based country from qualifying for
lower risk weight treatment.
The Agencies invited comment on all
aspects of the proposal.
II. Comments Received
The OCC and the Board together
received two public comments on their
proposal. (The FDIC did not receive any
comments.) One commenter was a
regional banking organization that
generally supported the proposal. The
other was a clearinghouse that opposed
the proposal.
Tne banking organization agreed that
OECD membership alone is not
sufficient to ensure that only countries
with relatively low transfer risk qualify
for lower risk weight treatment, and it
supported the additional criterion as
providing a good indication of a higher
level of transfer risk. The banking
organization suggested that the
definition should be further revised to
exclude newly-formed countries, whose
willingness and ability to meet their
debt obligations were unproven, for a
period of five years. The Agencies did
not adopt this suggestion, because the
process of admitting countries to the
OECD is lengthy enough that the fiveyear waiting period recommended by
the commenter would have little
practical effect.

The clearinghouse viewed the current
criteria as adequate and commented that
adding another criterion would increase
the complexity of and confusion about
the risk-based capital guidelines.
Although the Agencies agree with the
commenter on the need to minimize the
complexity of the risk-based capital
guidelines, the Agencies do not believe
that this rule will increase their
complexity significantly, particularly
since reschedulings by OECD countries
tend to be extremely rare. Until a
rescheduling occurs, the change in the
definition will not have any effect on
the assignment of assets to risk-weight
categories, and thus will have little or
no effect on banks.
III. Final Rule
After carefully considering the
comments received and deliberating
further on the issues involved, the
Agencies are adopting a final rule that
amends the definition of the OECDbased group of countries in their riskbased capital guidelines substantially as
proposed.
Under the final rule, the OECD-based
group of countries continues to include
countries that are full members of the
OECD, regardless of entry date, as well
as countries that have concluded special
lending arrangements w ith the IMF
associated with the IMF’s General
Arrangements to Borrow, but excludes
any country within this group that has
rescheduled its external sovereign debt
w ithin the previous five years.
For purposes of this final rule, an
event of rescheduling of external
sovereign debt generally would include
renegotiations of terms arising from a
country’s inability or unwillingness to
meet its external debt service
obligations. Renegotiations of debt in
the normal course of business generally
do not indicate transfer risk of the kind
that w ould preclude an OECD-based
country from qualifying for lower risk
weight treatment. One example of such
a routine renegotiation would be a
renegotiation to allow the borrower to
take advantage of a change in market
conditions, such as a decline in interest
rates.
This distinction between
renegotiations arising from a country’s
inability or unwillingness to meet its
external debt service obligations and
renegotiations that reflect a change in
market conditions was discussed in the
preambles of the Agencies’ notices of
proposed rulemaking but was not
included in the regulatory text. In order
to clarify the meaning of the final rule,
the Agencies are including language to
this effect in the text of the final rule.

66044 Federal Register / Vol. 60, No. 244 / Wednesday, December 20, 1995 / Rules and Regulations
IV. Regulatory Flexibility Act Analysis
The Agencies hereby certify that this
final rule will not have a significant
economic impact on a substantial
number of small business entities (in
this case, small banking organizations),
in accord with the spirit and purposes
of the Regulatory Flexibility Act (5
U.S.C. 601 et seq.). The impact on
institutions regulated by the Agencies,
regardless of their size, will be minimal.
In addition, because the risk-based
capital guidelines generally do not
apply to bank holding companies with
consolidated assets of less than $150
million, this proposal will not affect
such companies. Accordingly, no
regulatory flexibility analysis is
required.
V. Paperwork Reduction Act and
Regulatory Burden
The Agencies have determined that
this final rule will not increase the
regulatory paperwork burden of banking
organizations pursuant to the provisions
of the Paperwork Reduction Act (44
U.S.C. 3501 et seq.).
Section 302 of the Riegle Community
Development and Regulatory
Improvement Act of 1994 (Pub. L. 103325, 108 Stat. 2160) provides that the
Agencies must consider the
administrative burdens and benefits of
any new regulations that impose
additional requirements on insured
depository institutions. Section 302 also
requires such a rule to take effect on the
first day of the calendar quarter
following final publication of the rule,
unless the agency, for good cause,
determines an earlier effective date is
appropriate. This final rule is effective
on April 1,1996.
VI. OCC Statement on Executive Order
12866
The OCC has determined that this
final rule is not a significant regulatory
action, as that term is defined by
Executive Order 12866.
VII. OCC Statement on Unfunded
Mandates Act of 1995
Section 202 of the Unfunded
Mandates Reform Act of 1995, Pub. L.
104— (Unfunded Mandates Act), signed
4
into law on March 22,1995, requires
that an agency prepare a budgetary
impact statement before promulgating a
rule that includes a Federal mandate
that may result in expenditure by State,
local, and tribal governments, in the
aggregate, or by the private sector, of
$100 million or more in any one year.
If a budgetary impact statement is
required, section 205 of the Unfunded
Mandates Act also requires an agency to
identify and consider a reasonable

number of regulatory alternatives before
promulgating a rule. The OCC has
determined that this final rule w ill not
result in expenditures by State, local,
and tribal governments, or by the
private sector, of $100 m illion or more
in any one year. Accordingly, the OCC
has not prepared a budgetary impact
statement or specifically addressed the
regulatory alternatives considered.
List of Subjects
12 CFR Part 3
Administrative practice and
procedure, Capital, National banks,
Reporting and recordkeeping
requirements, Risk'.
12 CFR Part 208
Accounting, Agriculture, Banks,
banking, Confidential business
information, Crime, Currency, Federal
Reserve System, Flood insurance,
Mortgages, Reporting and recordkeeping
requirements, Securities.
12 CFR Part 225
Administrative practice and
procedure, Banks, banking, Federal
Reserve System, Holding companies,
Reporting and recordkeeping
requirements, Securities.
12 CFR Part 325
Bank deposit insurance, Banks,
banking, Capital adequacy, Reporting
and recordkeeping requirements,
Savings associations, State nonm ember
banks.
Authority and Issuance
OFFICE OF THE COMPTROLLER OF THE
CURRENCY
12 CFR CHAPTER I

For the reasons set out in the joint
preamble, Appendix A to part 3 of title
12, chapter I of the Code of Federal
Regulations is amended as set forth
below.
PART 3— MINIMUM CAPITAL RATIOS;
ISSUANCE OF DIRECTIVES

1. The authority citation for part 3
continues to read as follows:

(c) * * *
(16) The OECD-based group o f countries
comprises all fall members of the
Organization for Economic Cooperation and
Development (OECD) regardless of entry
date, as well as countries that have
concluded special lending arrangements with
the International Monetary FundJIM F)
associated w ith the IMF’s General
Arrangements to Borrow,1 but excludes any
country that has rescheduled its external
sovereign debt w ithin the previous five years.
These countries are hereinafter referred to as
OECD countries. A rescheduling of external
sovereign debt generally w ould include any
renegotiation of terms arising from a
country’s inability or unwillingness to meet
its external debt service obligations, but
generally would not include renegotiations of
debt in the normal course of business, such
as a renegotiation to allow the borrower to
take advantage of a decline in interest rates
or other change in market conditions.

*

Appendix A to Part 3—Risk-Based
Capital Guidelines
Section 1. Purpose, A pplicability o f
Guidelines, and Definitions.

*

*

*

*

*

*

*

*

*

FEDERAL RESERVE SYSTEM
12 CFR CHAPTER II

For the reasons set forth in the joint
preamble, the Board of Governors of the
Federal Reserve System amends 12 CFR
parts 208 and 225 as set forth below:
PART 20&—MEMBERSHIP OF STATE
BANKING INSTITUTIONS IN THE
FEDERAL RESERVE SYSTEM
(REGULATION H)

1. The authority citation for part 208
continues to read as follows:
Authority: 12 U.S.C. 36, 248(a), 248(c),
321-338a, 371d, 461, 481^186, 601, 611,
1814, 1823(j), 1828(o), 18310,1 83 1 p -l, 3105,
3310, 3331-3351, and 3906-3909; 15 U.S.C.
78b, 781(b), 781(g), 78l(i), 78o-4(c)(5), 78q,
7 8 q -l, and 78w; 31 U.S.C. 5318; 42 U.S.C.
4102a, 4104a, 4104b, 4106, 4128.

2. A ppendix A to part 208 is am ended
by revising footnote 22 in section IU.B.l.
to read as follows:
Appendix A to Part 208—Capital
Adequacy Guidelines for State Member
Banks: Risk-Based Measure
*

*

*

*

*

III. * * *
B. * * *

Authority: 12 U.S.C. 93a, 161,1818,
1828(n), 1831n note, 1835, 3907, and 3909.

2. In section 1 of appendix A to part
3, footnote 1 in paragraph (c)(19) is
redesignated as footnote la.
3. In section 1 of appendix A to part
3, paragraph (c)(16) is revised to read as
follows:

*

Dated: August 28,1995.
Eugene A. Ludwig,
‘ Comptroller o f the Currency.

*

*

*

*

*

22 *

*

*

*

*

*

22The OECD-based group of countries
comprises all full members of the
1As of November 1995, the OECD included the
following countries: Australia, Austria, Belgium,
Canada, Denmark, Finland, France, Germany,
Greece, Iceland, Ireland, Italy, Japan, Luxembourg,
Mexico, the Netherlands, New Zealand, Norway,
Portugal, Spain, Sweden, Switzerland, Turkey, the
United Kingdom, and the United States; and Saudi
Arabia had concluded special lending arrangements
w ith the IMF associated with the IMF’s General
Arrangements to Borrow.

Federal Register / Vol. 60, No. 244 / Wednesday, December 20, 1995 / Rules and Regulations 66045
Organization for Economic Cooperation and
Development (OECD) regardless of entry
date, as well as countries that have
concluded special lending arrangements with
the International Monetary Fund (IMF)
associated with the IMF’s General
Arrangements to Borrow, but excludes any
country that has rescheduled its external
sovereign debt w ithin the previous five years.
As of November 1995, the OECD included
the following countries: Australia, Austria,
Belgium, Canada, Denmark, Finland, France,
Germany, Greece, Iceland, Ireland, Italy,
Japan, Luxembourg, Mexico, the Netherlands,
New Zealand, Norway, Portugal, Spain,
Sweden, Switzerland, Turkey, the United
Kingdom, and the U nited States; and Saudi
Arabia had concluded special lending
arrangements with the IMF associated with
the IMF’s General Arrangements to Borrow.
A rescheduling of external sovereign debt
generally w ould include any renegotiation of
terms arising from a country’s inability or
unwillingness to m eet its external debt
service obligations, but generally would not
include renegotiations of debt in the normal
course of business, such as a renegotiation to
allow the borrower to take advantage of a
decline in interest rates or other change in
market conditions.
*

*

*

*

*

PART 225— BANK HOLDING
COMPANIES AND CHANGE IN BANK
CONTROL (REGULATION Y)

1. The authority citation for part 225
continues to read as follows:
Authority: 12 U.S.C. 1817(j)(13), 1818,
1828(o), 1831i, 1831p— 1843(c)(8), 1844(b),
1,
1927(1), 3106, 3108, 3310, 3331-3351, 3907,
and 3909.

2. Appendix A to part 225 is amended
by revising footnote 25 in section III.B.l.
to read as follows:
Appendix A to Part 225—Capital
Adequacy Guidelines for Bank Holding
Companies: Risk-Based Measure
III. * * *
B. * * *
^

*

*

*

*

*

25

*

*

*

*

*

*

25The OECD-based group of countries
comprises all full members of the
Organization for Economic Cooperation and

Development (OECD) regardless of entry
date, as well as countries that have
concluded special lending arrangements with
the International Monetary Fund (IMF)
associated w ith the IMF’s General
Arrangements to Borrow, but excludes any
country that has rescheduled its external
sovereign debt w ithin the previous five years.
As of November 1995, the OECD included
the following countries: Australia, Austria,
Belgium, Canada, Denmark, Finland, France,
Germany, Greece, Iceland, Ireland, Italy,
Japan, Luxembourg, Mexico, the Netherlands,
New Zealand, Norway, Portugal, Spain,
Sweden, Switzerland, Turkey, the United
Kingdom, and the United States; and Saudi
Arabia had concluded special lending
arrangements w ith the IMF associated with
the IMF’s General Arrangements to Borrow.
A rescheduling of external sovereign debt
generally w ould include any renegotiation of
terms arising from a country’s inability or
unwillingness to meet its external debt
service obligations, but generally w ould not
include renegotiations of debt in the normal
course of business, such as a renegotiation to
allow the borrower to take advantage of a
decline in interest rates or other change in
market conditions.

*

*

*

*

*

By the order of the Board of Governors of
the Federal Reserve System, November 13,
1995.
William W. Wiles,
Secretary o f the Board.
FEDERAL DEPOSIT INSURANCE
CORPORATION
12 CFR CHAPTER III

For the reasons set forth in the joint
preamble, the Board of Directors of the
Federal Deposit Insurance Corporation
amends part 325 of title 12 of the Code
of Federal Regulations as follows:
PART 325— CAPITAL MAINTENANCE

1. The authority citation for part 325
continues to read as follows:
Authority: 12 U.S.C. 1815(a), 1815(b),
1816,1818(a), 1818(b), 1818(c), 1818(t),
1819(tenth), 1828(c), 1828(d), 1828(i),
1828(n), 1828(o), 18310, 1835, 3907, 3909,
4808; Pub. L. 102-233, 105 Stat. 1761, 1789,
1790 (12 U.S.C. 1831n note); Pub. L. 102-

242,105 Stat. 2236, 2355, 2386 (12 U.S.C.
1828 note).

2. A ppendix A to part 325 is amended
by revising footnote 12 in section II.B.2.
to read as follows:
Appendix A to Part 325—Statement of
Policy on Risk-Based Capital
*

*

*

*

*

*

*

II. * * *
B. * * *
2

*

* * * 1 2 * * *

*

*

12The OECD-based group of countries
comprises all full members of the
Organization for Economic Cooperation and
Development (OECD) regardless of entry
date, as well as countries that have
concluded special lending arrangements with
the International Monetary Fund (IMF)
associated w ith the IMF’s General
Arrangements to Borrow, but excludes any
country that has rescheduled its external
sovereign debt w ithin the previous five years.
As of November 1995, the OECD included
the following countries: Australia, Austria,
Belgium, Canada, Denmark, Finland, France,
Germany, Greece, Iceland, Ireland, Italy,
Japan, Luxembourg, Mexico, the Netherlands,
New Zealand, Norway, Portugal, Spain,
Sweden, Switzerland, Turkey, the United
Kingdom, and the United States; and Saudi
Arabia had concluded special lending
arrangements w ith the IMF associated with
the IMF’s General Arrangements to Borrow.
A rescheduling of external sovereign debt
generally w ould include any renegotiation of
terms arising from a country’s inability or
unwillingness to meet its external debt
service obligations, but generally would not
include renegotiations of debt in the normal
course of business, such as a renegotiation to
allow the borrower to take advantage of a
decline in interest rates or other change in
market conditions.

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By order of the Board of Directors.
Dated at Washington, D.C. this 26th day of
October, 1995.
Federal Deposit Insurance Corporation.
Jerry L. Langley,
Executive Secretary.
[FR Doc. 95-30664 Filed 12-19-95; 8:45 am]
BILLING CODE 481 0 -3 3 -P ; S 210-01-P; 6714-01-P


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102