OCC Solicits Comments on Alternatives to the Use of External Credit Ratings

WASHINGTON—The Office of the Comptroller of the Currency seeks comment regarding alternatives to the use of credit ratings as measures of credit-worthiness in its regulations governing bank-permissible investment securities and certain other activities.

Section 939A of the Dodd-Frank Wall Street Reform and Consumer Protection Act requires federal agencies to review, no later than one year after enactment, any regulation that requires use of an assessment of credit-worthiness of a security or money market instrument and any references to, or requirements in, regulations regarding credit ratings. The agencies are also required to remove references or requirements to rely on credit ratings and to substitute an alternative standard of credit-worthiness.

Credit ratings are currently used in a variety of ways to help determine credit quality, liquidity and marketability of an asset, and appropriate concentration levels of investment securities purchased and held by national banks. Today's Advance Notice of Proposed Rulemaking (Docket OCC-2010-0027) describes the areas where the OCC's regulations, other than those that establish regulatory capital requirements, currently rely on credit ratings; sets forth the considerations underlying such reliance; and requests comment on potential alternatives to the use of credit ratings. The OCC and the other federal banking agencies are issuing a separate joint advance notice of proposed rulemaking focused on the agencies' risk-based capital frameworks.

Comments on this ANPR must be received by no later than 60 days following publication in the Federal Register. The ANPR can be reviewed and comments can be submitted on www.regulations.gov. Comments may also be submitted by emailing regs.comments@occ.treas.gov, by faxing (202) 874-5274, or mailing Office of the Comptroller of the Currency, 250 E Street, SW., Mail Stop 2-3, Washington, DC 20219.

Related Links

• ANPR OCC-2010-0017 "Alternatives to the Use of External Credit Ratings in the Regulations of the OCC" (PDF)
• Regulations.gov