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The FDIC adopted an ICBA-supported final rule amending real estate lending standards for supervisory loan-to-value limits to incorporate the Community Bank Leverage Ratio rule.
Background: To make the basis for supervisory LTV limits more consistent among banks, the FDIC amended the reference from total capital to total tier 1 capital plus the allowance for credit losses. This change is also designed to provide uniform application for banks that choose to switch to and from the CBLR as the capital measurement metric.
ICBA Position: In a comment letter to the agency earlier this year, ICBA said the rule better aligns supervisory LTV reporting and measurement across community banks regardless of whether they elect the CBLR.