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Interest Rate Risk

Liquidity, Funds Management, and Sensitivity to Risk
July 12, 1996
TO: CHIEF EXECUTIVE OFFICER 
 
SUBJECT: Joint Agency Policy Statement on Interest Rate Risk 
 

The FDIC, the Federal Reserve Board and the Office of the Comptroller of the Currency have jointly issued a policy statement providing bankers guidance on sound interest rate risk management practices. The principles and practices identified in this policy statement describe the standards the agencies will use to evaluate the adequacy and effectiveness of a bank's interest rate risk management and the adequacy of its capital in light of its interest rate risk profile. 

This policy statement is in addition to the action taken by the agencies in August 1995 to implement the Federal Deposit Insurance Corporation Improvement Act of 1991 Section 305 requirements for risk-based capital standards for interest rate risk (FIL-54-95). This policy statement also replaces the proposed policy statement that the agencies issued for comment in August 1995 (FIL-55-95) regarding a supervisory framework for measuring and assessing bank interest rate risk. 

This policy statement is effective June 26, 1996. For more information, please contact one of the FDIC officials listed on Page 33166 of the attached Federal Register notice.

Nicholas J. Ketcha Jr. 
Director

 

Attachment: PDF Format (102 kb, PDF help or hard copy ), HTML Format 

Distribution: FDIC-Supervised Banks (Commercial and Savings) 

Last Updated: July 12, 1996