Comment requested on suggested domestic risk-based capital modifications.

The four federal banking agencies--the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the Office of Thrift Supervision--published on October 20, 2005, an interagency advance notice of proposed rulemaking (ANPR) regarding potential revisions to the existing risk-based capital framework. These changes would apply to banks, bank holding companies, and savings associations.

The ANPR document discusses various modifications to the U.S. risk-based capital standards including:

* increasing the number of risk-weight categories to which credit exposures may be assigned;

* expanding the use of external credit ratings as an indicator of credit risk for externally rated exposures;

* expanding the range of collateral and guarantors that may qualify an exposure for lower risk weights;

* using loan-to-value ratios, credit assessments, and other broad measures of credit risk for assigning risk weights to residential mortgages;

* modifying the credit conversion factor for various commitments, including those with an original maturity of less than one year;

* requiring that certain loans ninety days or more past due or in a non-accrual status be assigned to a higher risk-weight category;

* modifying the risk-based capital requirements for certain commercial real estate exposures;

* increasing the risk sensitivity of capital requirements for other types of retail, multifamily, small business, and commercial exposures; and

* assessing a risk-based capital charge to reflect the risks in securitizations with early amortization provisions that are backed by revolving retail exposures.

Comments must be received on or before January 18, 2006.