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Financial Institution Letters

September 18, 2018

Regulatory Capital Rules

Revised Definition of a High Volatility Commercial Real Estate (HVCRE) Exposure

Printable Format:

FIL-50-2018 - PDF (PDF Help)


The federal bank regulatory agencies (the agencies) have jointly issued a notice of proposed rulemaking (NPR) that would revise the definition of an HVCRE exposure in Part 324, in accordance with Section 214 of the Economic Growth, Regulatory Relief, and Consumer Protection Act, and provide interpretation on certain aspects of the revised HCVRE exposure definition.

Statement of Applicability to Institutions with Total Assets Under $1 Billion: This Financial Institution Letter is applicable to all banks.


The NPR would revise the definition of an HVCRE exposure to conform to the statutory definition of a high volatility commercial real estate acquisition, development, or construction (HVCRE ADC) loan, which includes a credit facility that:

The NPR also would exclude loans financing the acquisition, development or construction of the following real properties:

Finally, the NPR proposes interpretations of certain terms generally consistent with their usage in other relevant regulations or the instructions to the Call Report.


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