News Column

RMA Urges Fed to Reconsider Requiring Large Bank Holding Companies to Provide Litigation Reserve Information

August 21, 2014



PHILADELPHIA, Aug. 21 -- The Risk Management Association issued the following news release:

The Risk Management Association'sAdvanced Measurement Approaches Group (AMAG) has responded to a Federal Reserve (Fed) proposal that would require large bank holding companies to provide litigation reserve information to the Fed as part of the Comprehensive Capital Analysis and Review (CCAR) process.

In a letter to the Fed, the RMA group argues that including legal reserve information in the CCAR submissions would subject banks to significant prejudice, and that there is no assurance such information would remain confidential. The group believes that requiring banks to disclose legal reserves would be "unwise, unsound, and highly prejudicial."

In particular, RMA notes the severe risk of inadvertent disclosure; legal discovery by other agencies and third parties, including potential plaintiffs such as the U.S. government; and unfair damage to banks' reputations.

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Source: Targeted News Service


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