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entitled 'Dodd-Frank Regulations: Agencies Conducted Regulatory 
Analyses and Coordinated but Could Benefit from Additional Guidance on 
Major Rules' which was released on December 11, 2013. 

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United States Government Accountability Office: 
GAO: 

Report to Congressional Addressees: 

December 2013: 

Dodd-Frank Regulations: 

Agencies Conducted Regulatory Analyses and Coordinated but Could 
Benefit from Additional Guidance on Major Rules: 

GAO-14-67: 

GAO Highlights: 

Highlights of GAO-14-67, a report to congressional addressees. 

Why GAO Did This Study: 

The 2010 Dodd-Frank Act requires or authorizes various federal 
agencies to issue hundreds of rules to implement reforms intended to 
strengthen the financial services industry. As amended by Public Law 
No. 112-10, the act also mandates that GAO annually study financial 
services regulations. This report examines (1) the regulatory analyses 
agencies conducted in their Dodd-Frank rulemakings; (2) interagency 
coordination on such rulemakings and by CFPB in its supervision 
activities; and (3) the possible impact of selected Dodd-Frank 
provisions and related rules and agency plans to assess Dodd-Frank Act 
rules retrospectively. GAO identified and reviewed 70 Dodd-Frank rules 
that became effective from July 24, 2012, through July 22, 2013, to 
determine whether the required regulatory analyses and coordination 
were conducted; examined CFPB’s policies, procedures, and other 
materials; developed indicators on the impact of the act’s systemic 
risk-related provisions and rules; conducted a regression analysis to 
assess the act’s impact on large bank holding companies; and 
interviewed federal financial regulators and officials from the U.S. 
Department of the Treasury, the Financial Stability Oversight Council, 
and OMB. 

What GAO Found: 

Federal agencies conducted the required regulatory analyses for all 
rules issued pursuant to the Dodd-Frank Wall Street Reform and 
Consumer Protection Act (Dodd-Frank Act) that GAO identified and 
reviewed. However, the Office of Management and Budget (OMB), in 
coordination with the agencies, may not be consistently determining 
which rules are considered major rules under the Congressional Review 
Act (CRA). Under the act, Congress is allowed to review major rules 
before they become effective. The act outlines criteria for 
determining whether a rule is major, such as whether it will result in 
an annual effect on the economy of $100 million or more. OMB is 
responsible for determining which rules are major under CRA but relies 
on agency analyses to help make the determination. OMB guidance does 
not address whether independent agencies should submit all rules for 
review or how they should apply major rule criteria. GAO found that 
some independent agencies submitted all their rules to OMB, but others 
did not. GAO also found inconsistencies in how these agencies applied 
the CRA criteria. For example, GAO found rules issued by different 
agencies that had similar economic impacts but were not similarly 
classified as major. These issues raise the risk of some rules not 
being properly classified as major, limiting Congress’s ability to 
review these rules before they become effective. 

Federal regulators coordinated on 49 rulemakings pursuant to the Dodd-
Frank Act or voluntarily. As required by the act, the Consumer 
Financial Protection Bureau (CFPB) established a framework to 
coordinate its supervision activities with prudential regulators and 
is establishing a similar framework to coordinate with state 
regulators. In May 2012, CFPB and prudential regulators entered into 
an agreement that specifies how they plan to meet the act’s 
coordination requirements for the supervision of large banks (i.e., 
more than $10 billion in assets). CFPB has entered into similar 
agreements with state regulators to coordinate examinations of banks 
and nonbank financial entities. 

The Dodd-Frank Act has not been fully implemented and its full impact 
remains uncertain. Using recently released data, GAO updated its prior 
report’s indicators monitoring certain risk characteristics of large 
U.S. bank holding companies. Although changes in the indicators are 
not evidence of causal links to the act’s provisions, some indicators 
suggest these companies, on average, have decreased their leverage and 
enhanced their liquidity since the act’s passage. Moreover, GAO’s 
updated regression analysis suggests that the act continued to have 
little effect on the funding costs of large U.S. bank holding 
companies but may have helped improve their safety and soundness. 
Based on its analysis of the act and market data, GAO also developed 
new indicators for this report to monitor the extent to which certain 
of the act’s swap reforms are associated with their intended outcomes. 
These indicators establish baselines for measuring future changes. 
Finally, GAO examined federal financial regulators’ plans to conduct 
retrospective reviews of their Dodd-Frank rules. Executive Order 
13,579 asks independent agencies, including federal financial 
regulators, to develop plans to conduct retrospective reviews of 
existing rules that may be excessively burdensome or costly. 
Regulators have varied in their approaches and progress in developing 
and implementing such plans. Given the importance of such reviews, GAO 
recommended in 2011 that the regulators determine how they will 
measure the impact of Dodd-Frank regulations in their plans, but they 
have not done so to date. GAO maintains that doing so would position 
the regulators to make their future retrospective reviews as robust as 
possible. 

What GAO Recommends: 

GAO recommends that OMB issue guidance to help standardize CRA 
processes. OMB disagreed such guidance is needed, in part because GAO 
did not identify inconsistencies in major rule designations. GAO 
maintains that the identified process inconsistencies could lead to 
differing designations under CRA, and its recommendation helps ensure 
consistency in designating major rules. 

View [hyperlink, http://www.gao.gov/products/GAO-14-67]. For more 
information, contact A. Nicole Clowers at (202) 512-8678 or 
clowersa@gao.gov. 

[End of section] 

Contents: 

Letter: 

Background: 

Agencies Conducted Required Regulatory Analyses but May Not Be 
Identifying All Major Rules: 

Regulators Continue to Coordinate on Rulemakings: 

Impacts of the Dodd-Frank Act Are Uncertain, and Regulators Are 
Developing Plans to Review Rules Retrospectively: 

Conclusions: 

Recommendations for Executive Action: 

Agency Comments and Our Evaluation: 

Appendix I: Objectives, Scope, and Methodology: 

Appendix II: Dodd-Frank Rules Effective as of July 22, 2013: 

Appendix III: Dodd-Frank Rules Classified as Major, Final as of July 
22, 2013: 

Appendix IV: Interagency Coordination for Dodd-Frank Rules Effective 
on July 24, 2012, through July 22, 2013: 

Appendix V: Summary of Rulemakings Related to Selected Dodd-Frank 
Provisions Applicable to Systemically Important Financial Institutions: 

Appendix VI: Trends in GAO Indicators for Bank SIFIs: 

Appendix VII: Econometric Analyses of the Impact of Enhanced 
Regulation and Oversight on SIFIs: 

Appendix VIII: Dodd-Frank Rules Implementing Central Clearing, 
Capital, and Margin Swap Reforms: 

Appendix IX: Comments from the Financial Stability Oversight Council: 

Appendix X: Comments from the National Credit Union Administration: 

Appendix XI: GAO Contact and Acknowledgments: 

Tables: 

Table 1: Prudential Regulators and Their Basic Functions: 

Table 2: Summary of Trends in Indicators for Bank SIFIs, from Third 
Quarter 2010 through Second Quarter 2013: 

Table 3: Estimated Changes in U.S. Bank SIFIs' Funding Costs and 
Measures of Safety and Soundness Associated with the Dodd-Frank Act, 
from Third Quarter 2010 through Second Quarter 2013: 

Table 4: Dodd-Frank Rules Effective from July 24, 2012, through July 
22, 2013: 

Table 5: Dodd-Frank Rules Effective from July 22, 2011, through July 
23, 2012: 

Table 6: Dodd-Frank Rules Effective as of July 21, 2011: 

Table 7: Dodd-Frank Rules Classified as Major, Final as of July 22, 
2013: 

Table 8: Evidence of Interagency Coordination in Dodd-Frank 
Regulations Effective July 24, 2012, through July 22, 2013: 

Table 9: Rulemakings Implementing Selected Dodd-Frank Provisions 
Applicable to Systemically Important Financial Institutions and Their 
Status as of November 29, 2013: 

Table 10: Number and Median Size of U.S. Bank Holding Companies and 
Bank SIFIs as of Third Quarter 2010, Second Quarter 2012, and Second 
Quarter 2013 (Assets in Billions of Constant 2013 Q2 Dollars): 

Table 11: 2013 Large Bank SIFIs' Foreign Legal Entities, as of June 
30, 2010, June 30, 2012, and June 30, 2013: 

Table 12: Estimated Changes in U.S. Bank SIFIs' Funding Costs and 
Measures of Safety and Soundness Associated with the Dodd-Frank Act, 
from Third Quarter 2010 through Second Quarter 2013: 

Table 13: Estimated Changes in Bank SIFIs' Capital Adequacy Indicators 
Associated with the Dodd-Frank Act, from Third Quarter 2010 through 
Second Quarter 2013: 

Table 14: Estimated Changes in Bank SIFIs' Funding Cost and Safety and 
Soundness Indicators Associated with the Dodd-Frank Act, from Third 
Quarter 2010 through Second Quarter 2013: 

Table 15: Select Dodd-Frank Rules Implementing Central Clearing Swap 
Reforms Final as of November 15, 2013: 

Table 16: Select Dodd-Frank Rules Implementing Capital and Margin Swap 
Reforms Proposed as of November 15, 2013: 

Figures: 

Figure 1: Overview of Clearing, Trading, and Reporting Requirements 
under Dodd-Frank Swaps Reforms: 

Figure 2: Trends in Central Clearing of Interest Rate Swaps (by 
Percentage of Gross Notional Value of Swaps), from January 2013 
through August 2013: 

Figure 3: Percentage of Credit Default Swaps Centrally Cleared (by 
Gross Notional Value of Swaps), from January 2013 through August 2013: 

Figure 4: Fair Value of Collateral as a Percentage of Net Current 
Credit Exposure from OTC Derivatives Contracts for All Counterparty 
Types Combined, from Second Quarter 2009 through Second Quarter 2013: 

Figure 5: Fair Value of Collateral as a Percentage of Net Current 
Credit Exposure from OTC Derivatives Contracts by Counterparty Type, 
from Second Quarter 2009 through Second Quarter 2013: 

Figure 6: 2013 U.S. Bank SIFIs' Total Assets, as of Second Quarter 
2013: 

Figure 7: Median Market Share for U.S. Bank Holding Companies by Size, 
from First Quarter 2006 through Second Quarter 2013: 

Figure 8: 2013 U.S. Bank SIFIs' Total Legal Entities, as of June 30, 
2010, June 30, 2012, and June 30, 2013: 

Figure 9: Median Tangible Common Equity as a Percentage of Total 
Assets for Bank Holding Companies by Size, from First Quarter 2006 
through Second Quarter 2013: 

Figure 10: Median Tangible Common Equity as a Percentage of Risk-
Weighted Assets for Bank Holding Companies by Size, from First Quarter 
2006 through Second Quarter 2013: 

Figure 11: Median Short-Term Liabilities as a Percentage of Total 
Liabilities for U.S. Bank Holding Companies by Size, from First 
Quarter 2006 through Second Quarter 2013: 

Figure 12: Median Liquid Assets as a Percentage of Short-term 
Liabilities for U.S. Bank Holding Companies by Size, from First 
Quarter 2006 through Second Quarter 2013: 

Abbreviations: 

CDS: credit default swaps: 

CFPB: Consumer Financial Protection Bureau: 

CFTC: Commodity Futures Trading Commission: 

CRA: Congressional Review Act: 

CSBS: Conference of State Bank Supervisors: 

Dodd-Frank Act: Dodd-Frank Wall Street Reform and Consumer Protection 
Act: 

EGRPRA: Economic Growth and Regulatory Paperwork Reduction Act of 1996: 

E.O. Executive Order: 

FDIC: Federal Deposit Insurance Corporation: 

Federal Reserve: Board of Governors of the Federal Reserve System: 

FSOC: Financial Stability Oversight Council: 

MOU: memorandum of understanding: 

NCUA: National Credit Union Administration: 

OCC: Office of the Comptroller of the Currency: 

OMB: Office of Management and Budget: 

OT: Cover-the-counter: 

PRA: Paperwork Reduction Act: 

RFA: Regulatory Flexibility Act: 

SEC: Securities and Exchange Commission: 

SIFI: systemically important financial institutions: 

Treasury: U.S. Department of the Treasury: 

[End of section] 

GAO:
United States Government Accountability Office: 
441 G St. N.W. 
Washington, DC 20548: 

December 11, 2013: 

Congressional Addressees: 

The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-
Frank Act) of 2010 requires federal agencies to issue hundreds of 
regulations to implement the act's requirements.[Footnote 1] The act 
responds to the 2007-2009 financial crisis that disrupted the U.S. 
financial system and threatened not only the solvency of some large 
financial institutions but also the health of the U.S. economy. 
Although the financial services industry, academics, and others 
generally have supported the Dodd-Frank Act's goal of enhancing the 
stability of the U.S. financial system, the act's provisions and their 
implementation have been subject to debate. For example, no consensus 
exists on the extent to which the act will help reduce the likelihood 
and severity of future financial crises or on the magnitude of the 
costs that the act and its regulations--individually and cumulatively--
will impose on U.S. financial institutions and the economy.[Footnote 
2] Additionally, some market observers have raised concerns about the 
pace of reform, with some suggesting that reform is occurring too 
slowly and others arguing that it is moving too quickly. 

Federal rulemaking is subject to multiple statutory requirements and 
executive orders. However, the extent to which the federal financial 
regulators and other federal agencies are subject to these 
requirements varies.[Footnote 3] For example, the Paperwork Reduction 
Act (PRA) and the Regulatory Flexibility Act (RFA) impose regulatory 
analysis requirements on federal agencies, including the federal 
financial regulators.[Footnote 4] PRA requires agencies to justify 
collection of information from the public to minimize the paperwork 
burden and estimate the time and expense needed to comply with the 
paperwork requirements contained in their rules. RFA requires agencies 
to assess the impact of their regulation on small entities and 
consider regulatory alternatives to lessen the regulatory burden on 
small entities. Under the Congressional Review Act (CRA), before rules 
can take effect, federal agencies, including the federal financial 
regulators, must submit their rules to Congress and the Comptroller 
General, and rules deemed major by the Office of Management and Budget 
(OMB) generally may not become effective until 60 days after the rules 
are submitted.[Footnote 5] For agencies subject to Executive Order 
12,866 (E.O. 12,866), such major rules would be considered significant 
regulatory actions and as such would be subject to formal benefit-cost 
analysis.[Footnote 6] However, as independent regulatory agencies, the 
federal financial regulators are not required to comply with executive 
orders.[Footnote 7] 

Section 1573(a) of the Department of Defense and Full-Year Continuing 
Appropriations Act of 2011 amends the Dodd-Frank Act and mandates that 
GAO conduct an annual study of financial services regulations, 
including those of the Consumer Financial Protection Bureau (CFPB). 
[Footnote 8] We issued our first two reports under this mandate in 
November 2011 and December 2012.[Footnote 9] This report examines the: 

* regulatory analyses conducted by federal agencies in their Dodd-
Frank rulemakings, including their assessments of which rules they 
considered to be major rules; 

* interagency coordination by federal agencies in their Dodd-Frank 
rulemakings and by CFPB with other agencies in its supervision 
activities; and: 

* possible impact of selected Dodd-Frank provisions and their 
implementing regulations and agency plans to assess such regulations 
retrospectively. 

To examine agencies' regulatory analyses and coordination, we focused 
on final Dodd-Frank rules that became effective from July 24, 2012, 
through July 22, 2013, a total of 70 rules. To identify these rules, 
we used a website maintained by the Federal Reserve Bank of St. Louis 
that tracks Dodd-Frank regulations. We corroborated the data with the 
federal agencies and data from their websites. 

In examining the regulatory analyses of the federal agencies in our 
review, we reviewed federal statutes, GAO studies, Federal Register 
releases, and other material to identify and summarize the regulatory 
analyses federal agencies are required to conduct, and conducted, for 
Dodd-Frank rulemakings. Of the 70 rules within our scope, 59 rules 
were substantive regulations--generally subject to public notice and 
comment under the Administrative Procedure Act--and required the 
agencies to conduct some form of regulatory analysis. Of the 59 rules, 
10 were classified as major under CRA. For those 10 rules, we compared 
the regulatory analyses against principles in OMB Circular A-4, which 
provides guidance on the development of such analyses.[Footnote 10] To 
examine how OMB, in consultation with federal agencies, classifies 
rules as major, we reviewed CRA, agency analyses, Federal Register 
releases of Dodd-Frank major rules, GAO reports, and other materials, 
and interviewed officials from OMB and federal financial regulators. 
We relied on our Federal Rules database to identify all Dodd-Frank 
rules classified as major as of July 22, 2013--36 in total (including 
the 10 from the specified time period mentioned above).[Footnote 11] 

To examine interagency coordination among the regulators, we reviewed 
the Dodd-Frank Act, Federal Register releases, and GAO reports to 
identify the interagency coordination or consultation requirements for 
the 70 rules in our scope. We found evidence of coordination between 
the rulemaking agency and other regulators for 49 of the 70 rules. We 
reviewed the Federal Register releases of the final rules and 
interviewed agency officials to document whether the agencies 
coordinated with other U.S., foreign, or international regulators, 
either as required by Dodd-Frank or on a voluntary basis. To examine 
steps CFPB took to comply with Dodd-Frank requirements for interagency 
coordination and information sharing in its supervision activities, we 
reviewed the act, CFPB documents, and GAO reports. We also interviewed 
officials from CFPB and the prudential regulators about such 
coordination. 

Finally, we took a multipronged approach to analyze what is known 
about the impact of the Dodd-Frank Act on the financial marketplace. 
First, we updated our indicators monitoring changes in certain 
characteristics of systemically important financial institutions 
(SIFI) that might be affected by Dodd-Frank regulations.[Footnote 12] 
Second, we updated our economic analysis estimating changes in the (1) 
cost of credit provided by bank SIFIs and (2) safety and soundness of 
bank SIFIs. Third, we developed indicators to monitor the extent to 
which certain of the Dodd-Frank's swap reforms are consistent with the 
act's goals.[Footnote 13] As new data become available, we expect to 
update and, as warranted, revise our indicators and create additional 
indicators. Fourth, to assess agency plans to conduct retrospective 
reviews of existing rules, we reviewed executive orders; OMB guidance; 
Federal Register releases, policies, and other agency documents; and 
GAO reports. Finally, we interviewed agency officials about their 
plans to conduct retrospective reviews of their Dodd-Frank rules. For 
parts of our methodology involving the analysis of computer-processed 
data, we assessed the reliability of these data and determined they 
were sufficiently reliable for our purposes. (See appendix I for a 
detailed discussion of our objectives, scope, and methodology.) 

We conducted this performance audit from January 2013 to December 2013 
in accordance with generally accepted government auditing standards. 
Those standards require that we plan and perform the audit to obtain 
sufficient, appropriate evidence to provide a reasonable basis for our 
findings and conclusions based on our audit objectives. We believe 
that the evidence obtained provides a reasonable basis for our 
findings and conclusions based on our audit objectives. 

Background: 

Financial Services Regulation: 

The U.S. financial regulatory structure is a complex system of 
multiple federal and state regulators as well as self-regulatory 
organizations that operates largely along functional lines. That is, 
financial products or activities generally are regulated according to 
their function, no matter which entity offers the product or 
participates in the activity. The functional regulator approach is 
intended to provide consistency in regulation, focus regulatory 
restrictions on the relevant functional areas, and avoid the potential 
need for regulatory agencies to develop expertise in all aspects of 
financial regulation. 

Prudential Regulators: 

In the banking industry, the specific regulatory configuration 
generally depends on the type of charter the banking institution 
chooses. Depository institution charter types include: 

* commercial banks, which originally focused on the banking needs of 
businesses but over time have broadened their services; 

* thrifts, which include savings banks, savings associations, and 
savings and loans and were originally created to serve the needs--
particularly the mortgage needs--of those not served by commercial 
banks; and: 

* credit unions, which are member-owned cooperatives run by member-
elected boards with an historical emphasis on serving people of modest 
means. 

Charters may be obtained at the state or federal level. State 
regulators charter institutions and participate in the institutions' 
oversight, but all institutions that have federal deposit insurance 
have a federal prudential regulator. The federal prudential regulators-
-which generally may issue regulations and take enforcement actions 
against industry participants within their jurisdiction--are 
identified in table 1. Additionally, the Federal Deposit Insurance 
Corporation (FDIC) insures deposits in banks and thrifts, while the 
National Credit Union Administration (NCUA) insures deposits in 
federal and most state-chartered credit unions. 

Table 1: Prudential Regulators and Their Basic Functions: 

Agency: Office of the Comptroller of the Currency; 
Basic function: Charters and supervises national banks and federal 
thrifts. 

Agency: Board of Governors of the Federal Reserve System; 
Basic function: Supervises state-chartered banks that opt to be 
members of the Federal Reserve System, bank holding companies, thrift 
holding companies and the nondepository institution subsidiaries of 
those institutions, and nonbank financial companies designated as 
systemically important financial institutions by the Financial 
Stability Oversight Council. 

Agency: Federal Deposit Insurance Corporation; 
Basic function: Supervises FDIC-insured state-chartered banks that are 
not members of the Federal Reserve System, as well as federally 
insured state savings banks and thrifts; insures the deposits of all 
banks and thrifts that are approved for federal deposit insurance; and 
resolves all failed insured banks and thrifts and has been given the 
authority to resolve large bank holding companies and nonbank 
financial companies that are subject to supervision by the Board of 
Governors of the Federal Reserve System and subject to enhanced 
prudential standards. 

Agency: National Credit Union Administration; 
Basic function: Charters and supervises federally chartered credit 
unions and insures savings in federal and most state-chartered credit 
unions. 

Source: GAO. 

[End of table] 

Holding companies that own or control a bank or thrift are subject to 
supervision by the Board of Governors of the Federal Reserve System 
(Federal Reserve). The Bank Holding Company Act of 1956 and the Home 
Owners' Loan Act set forth the regulatory frameworks for bank holding 
companies and savings and loan holding companies, respectively. 
[Footnote 14] The Dodd-Frank Act made the Federal Reserve the 
regulator of savings and loan holding companies and amended the Home 
Owners' Loan Act and the Bank Holding Company Act to create certain 
similar requirements for both bank holding companies and savings and 
loan holding companies.[Footnote 15] 

Securities and Futures Regulators: 

The securities and futures markets are regulated under a combination 
of self-regulation (subject to oversight by the appropriate federal 
regulator) and direct oversight by the Securities and Exchange 
Commission (SEC) and Commodity Futures Trading Commission (CFTC), 
respectively.[Footnote 16] SEC regulates the securities markets, 
including participants such as securities exchanges, broker-dealers, 
investment companies, and investment advisers. SEC's mission is to 
protect investors; maintain fair, orderly, and efficient markets; and 
facilitate capital formation. SEC also oversees self-regulatory 
organizations--including securities exchanges, clearing agencies, and 
the Financial Industry Regulatory Authority--that have responsibility 
for overseeing securities markets and their members; establishing the 
standards under which their members conduct business; monitoring 
business conduct; and bringing disciplinary actions against members 
for violating applicable federal statutes, SEC's rules, and their own 
rules. 

CFTC is the primary regulator of futures markets, including futures 
exchanges and intermediaries, such as futures commission merchants. 
[Footnote 17] CFTC's mission is to protect market users and the public 
from fraud, manipulation, abusive practices, and systemic risk related 
to derivatives subject to the Commodity Exchange Act, and to foster 
open, competitive, and financially sound futures markets. Like SEC, 
CFTC oversees the registration of intermediaries and relies on self-
regulatory organizations, including the futures exchanges and the 
National Futures Association, to establish and enforce rules governing 
member behavior. In addition, Title VII of the Dodd-Frank Act expands 
regulatory responsibilities for CFTC and SEC by establishing a new 
regulatory framework for swaps. The act authorizes CFTC to regulate 
"swaps" and SEC to regulate "security-based swaps" with the goals of 
reducing risk, increasing transparency, and promoting market integrity 
in the financial system. 

Consumer Financial Protection Bureau: 

The Dodd-Frank Act established CFPB as an independent bureau within 
the Federal Reserve System and provided it with rule-making, 
enforcement, supervisory, and other powers over many entities that 
provide consumer financial products and services.[Footnote 18] Certain 
consumer financial protection functions from seven federal agencies 
were transferred to CFPB.[Footnote 19] CFPB has authority to supervise 
companies in the mortgage, payday lending, and private student lending 
markets. As such, CFPB is authorized to supervise certain nonbank 
consumer financial service companies and insured depository 
institutions and credit unions with over $10 billion in assets and 
their affiliates for compliance with federal consumer financial 
protection laws and related purposes. CFPB does not have authority 
over most insurance activities or most activities conducted by firms 
regulated by SEC or CFTC. 

Financial Stability Oversight Council (FSOC): 

The Dodd-Frank Act established FSOC to identify risks to the financial 
stability of the United States, promote market discipline, and respond 
to emerging threats to the stability of the U.S. financial system. The 
Dodd-Frank Act also established the Office of Financial Research 
within the U.S. Department of the Treasury (Treasury) to serve FSOC 
and its member agencies by improving the quality, transparency, and 
accessibility of financial data and information; conducting and 
sponsoring research related to financial stability; and promoting best 
practices in risk management.[Footnote 20] FSOC's membership consists 
of the Secretary of the Treasury, who chairs the council; the heads of 
CFPB, CFTC, FDIC, the Federal Reserve, the Federal Housing Finance 
Agency, NCUA, the Office of the Comptroller of the Currency (OCC), and 
SEC; the directors of the Office of Financial Research and the Federal 
Insurance Office; representatives from state-level financial 
regulators; and an independent member with insurance experience. 

Dodd-Frank Regulations: 

Under the Dodd-Frank Act, federal financial regulatory agencies are 
directed or have the authority to issue hundreds of regulations to 
implement the act's provisions. In some cases, the act gives the 
agencies little or no discretion in deciding how to implement the 
provisions. For instance, the Dodd-Frank Act made permanent a 
temporary increase in the FDIC deposit insurance coverage amount 
($100,000 to $250,000); therefore, FDIC revised its implementing 
regulation to conform to the change. However, other rulemaking 
provisions in the act appear to be discretionary in nature, stating 
that (1) certain agencies may issue rules to implement particular 
provisions or that the agencies may issue regulations that they decide 
are "necessary and appropriate;" or (2) agencies must issue 
regulations to implement particular provisions but have some level of 
discretion over the substance of the regulations. As a result, for 
these rulemaking provisions, the agencies may decide to promulgate 
rules for some or all of the provisions, and may have broad discretion 
to decide what these rules will contain and what exemptions, if any, 
will apply. 

Regulatory Analyses in Federal Rulemaking: 

As mentioned earlier, federal agencies generally must conduct 
regulatory analysis pursuant to PRA and RFA, among other statutes, as 
part of their rulemakings.[Footnote 21] PRA and RFA require federal 
agencies, including financial regulators, to assess various impacts 
and costs of their rules. However, the statutes do not require the 
agencies to conduct formal benefit and cost analyses that require 
identification and assessment of alternatives.[Footnote 22] 

In addition to these requirements, authorizing or other statutes 
require certain federal financial regulators to consider specific 
benefits, costs, and impacts of their rulemakings. However, none of 
these statutes, like PRA and RFA, prescribe formal, comprehensive 
benefit and cost analyses that require the identification and 
assessment of alternatives. Specifically, 

* CFTC, under section 15(a) of the Commodity Exchange Act, is required 
to consider the benefits and costs of its action before promulgating a 
regulation under the Commodity Exchange Act or issuing certain orders. 
Section 15(a) specifies that the benefits and costs shall be evaluated 
in light of (1) protection of market participants and the public; (2) 
efficiency, competitiveness, and financial integrity of futures 
markets; (3) price discovery; (4) sound risk-management practices; and 
(5) other public interest considerations.[Footnote 23] 

* Under the Consumer Financial Protection Act (Title X of the Dodd-
Frank Act), CFPB must consider the potential benefits and costs of its 
rules for consumers and entities that offer or provide consumer 
financial products and services, including potential reductions in 
consumer access to products or services resulting from the rules. 
[Footnote 24] CFPB also must consider the impacts on insured 
depository institutions and credit unions with $10 billion or less in 
assets, and the impacts on consumers in rural areas.[Footnote 25] When 
CFPB does not certify that a proposed regulation is not expected to 
have a significant economic impact on a substantial number of small 
entities, CFPB also must describe in its initial RFA analysis any 
projected increase in the cost of credit for small entities and any 
significant alternatives that would minimize such increases for small 
entities.[Footnote 26] 

* SEC must consider whether a rule will promote efficiency, 
competition, and capital formation whenever it is engaged in 
rulemaking and is required to consider or determine whether an action 
is necessary or appropriate in the public interest.[Footnote 27] SEC 
also must consider the impact that any rule promulgated under the 
Securities Exchange Act would have on competition.[Footnote 28] This 
provision states that a rule should not be adopted if it would impose 
a burden on competition that is not necessary or appropriate to the 
act's purposes. 

* The Electronic Funds Transfer Act, as amended by the Dodd-Frank Act, 
requires the Federal Reserve to prepare an analysis of the economic 
impact of regulations issued by the Federal Reserve that considers the 
costs and benefits to financial institutions, consumers, and other 
users of electronic fund transfers.[Footnote 29] The analysis must 
address the extent to which additional paperwork would be required, 
the effects upon competition in the provision of electronic banking 
services among large and small financial institutions, and the 
availability of such services to different classes of consumers, 
particularly low-income consumers. 

In contrast, E.O. 12,866, supplemented by Executive Order 13,563 (E.O. 
13,563), requires covered federal agencies, to the extent permitted by 
law and where applicable, to (1) assess benefits and costs of 
available regulatory alternatives and (2) include both quantifiable 
and qualitative measures of benefits and costs in their analysis, 
recognizing that some benefits and costs are difficult to 
quantify.[Footnote 30] According to OMB, such analysis can enable an 
agency to learn if the benefits of a rule are likely to justify the 
costs and discover which of the possible alternatives would yield the 
greatest net benefit or be the most cost-effective. In 2003, OMB 
issued Circular A-4 to provide guidance to federal executive agencies 
on the development of regulatory analysis as required by E.O. 
12,866.[Footnote 31] The guidance defines good regulatory analysis as 
including a statement of the need for the proposed regulation, an 
assessment of alternatives, and an evaluation of the benefits and 
costs of the proposed regulation and the alternatives. It also 
standardizes the way benefits and costs of federal regulatory actions 
should be measured and reported. Of the federal agencies included in 
our review, only FSOC and Treasury are subject to E.O. 12,866. As 
independent regulatory agencies, the federal financial regulators--
CFPB, CFTC, FDIC, the Federal Reserve, OCC, NCUA, and SEC--are not 
subject to E.O. 12,866 and OMB's Circular A-4. Although not subject to 
E.O. 12,866 and OMB Circular A-4, most of the federal financial 
regulators told us that they try to follow Circular A-4 in spirit. In 
our 2011 report, we found that the policies and procedures of these 
regulators did not fully reflect OMB guidance and recommended that 
they incorporate the guidance more fully in their rulemaking 
guidance.[Footnote 32] Since then, FDIC, OCC, and SEC revised their 
guidance as we recommended, but the other agencies have not.[Footnote 
33] 

Agencies Conducted Required Regulatory Analyses but May Not Be 
Identifying All Major Rules: 

In the Federal Register releases of the 59 Dodd-Frank rules that we 
identified and reviewed, the issuing federal agencies stated that they 
conducted the regulatory analyses required by various federal 
statutes.[Footnote 34] As independent regulatory agencies, the federal 
financial regulators--CFPB, CFTC, FDIC, the Federal Reserve, OCC, 
NCUA, and SEC--are not subject to executive orders that require 
comprehensive benefit-cost analysis in accordance with guidance issued 
by OMB. Under CRA, OMB is responsible for determining which rules are 
major but relies on agency analyses to help make the determination. 
However, our analysis showed that OMB and the agencies may not have 
applied the CRA criteria consistently in determining which rules are 
major rules. 

Regulators Conducted Required Regulatory Analyses for Their Dodd-Frank 
Rulemakings: 

Of the 70 Dodd-Frank rules within our scope, 59 regulations were 
substantive--generally subject to public notice and comment under the 
Administrative Procedure Act--and required some form of regulatory 
analysis. These rules were issued individually or jointly by CFPB, 
CFTC, FDIC, the Federal Reserve, NCUA, OCC, SEC, or Treasury. (See 
appendix II for a list of the regulations in our review.) In examining 
the regulatory analyses the regulators reported that they conducted 
for these 59 regulations, we found the following. 

* Agencies conducted the required regulatory analyses. The agencies 
conducted regulatory analyses pursuant to PRA and RFA for all 59 
rules. In addition, agencies conducted required regulatory analyses 
pursuant to other statutes, such as the Unfunded Mandates Reform Act 
of 1995, Small Business Regulatory Enforcement Fairness Act of 1996, 
and Riegle Community Development and Regulatory Improvement Act of 
1994. Agencies also stated that they considered the benefits and costs 
of their rules as required under their authorizing or other statute. 
Specifically, CFPB issued 15 rules for which it considered the 
potential benefits and costs for consumers and entities that offer or 
provide consumer financial products and services. CFTC and SEC 
individually or jointly issued 27 rules and considered their potential 
impact, including their benefits and costs, in light of each agency's 
required public interest considerations. The Federal Reserve issued 
one rule and it analyzed the rule's economic impact in consideration 
of the costs and benefits to financial institutions, consumers, and 
other users of electronic fund transfers. 

* Agencies identified 10 major rules. Of the 59 rules that were issued 
and became effective from July 24, 2012, through July 22, 2013, OMB 
identified 10 as major rules under CRA. Specifically, CFPB issued two 
major rules; CFTC issued three major rules; SEC issued two major 
rules; CFTC and SEC jointly issued one major rule; the Federal Reserve 
issued one major rule; and the Federal Reserve, FDIC, and OCC jointly 
issued one major rule. 

* In the 10 major rulemakings, agencies generally addressed the key 
elements in OMB's guidance. In our analysis of the 10 Dodd-Frank rules 
identified as major we found that the agencies addressed many of the 
OMB guidance's key elements. All of the rules identified the problem 
to be addressed. In all but two of the rule proposals, the agencies 
identified regulatory alternative approaches that they considered, and 
the agencies asked for and received public comments on alternatives in 
all of the rules. Based on public comments and other information, the 
agencies analyzed the benefits and costs of the rules, including 
regulatory alternatives. In 5 of the 10 rules, the agencies explicitly 
identified the baseline against which they assessed benefits and 
costs. In the other rules, the agencies implicitly identified the 
baseline, typically as pre-Dodd-Frank Act. However, as we found in our 
last review, the agencies quantified certain compliance costs 
associated with their rules, such as paperwork-related costs, but 
generally did not quantify other costs.[Footnote 35] Furthermore, none 
of the agencies quantified any of the benefits, in part because of 
stated data limitations. However, all of the agencies discussed the 
benefits and costs of their rules, including alternatives, in 
qualitative terms. 

OMB Classified a Number of the Dodd-Frank Rules as Major but, along 
with Federal Financial Regulators, Used Inconsistent Processes in 
Applying CRA's Criteria: 

Since the enactment of the Dodd-Frank Act through July 22, 2013, 
federal financial regulators and Treasury issued 36 Dodd-Frank rules 
that were classified as major under CRA. CRA, enacted in 1996, 
provides Congress with the opportunity to review and disapprove new 
rules issued by federal agencies.[Footnote 36] To that end, the act 
establishes procedures by which Congress may disapprove an agency's 
rule by introducing a joint resolution of disapproval within 60 days 
of receiving the rule that, if adopted by both houses of Congress and 
signed by the President, can nullify the agency's rule.[Footnote 37] 

Specifically, CRA requires agencies, including independent agencies, 
to submit final rules to Congress and the Comptroller General before 
the rules can become effective. Rules not classified as major go into 
effect as otherwise provided by law after submission to Congress and 
the Comptroller General, while rules classified as major take effect 
on the later of 60 days after Congress receives the rule report, or 60 
days after the rule is published in the Federal Register, as long as 
Congress does not pass a joint resolution of disapproval. During the 
60 day period, Congress may introduce, if desired, a resolution of 
disapproval prior to any major rule taking effect. CRA defines a major 
rule as any rule that the OMB finds has resulted in or is likely to 
result in (1) an annual effect on the economy of $100 million or more; 
(2) a major increase in costs or prices for consumers; individual 
industries; federal, state, or local government agencies; or 
geographic regions; or (3) significant adverse effects on competition, 
employment, investment, productivity, innovation, or on the ability of 
United States-based enterprises to compete with foreign based 
enterprises in domestic and export markets. Although OMB determines 
whether a rule should be classified as major under CRA, OMB officials 
told us that they rely on agency submissions of rules and analyses to 
help make the determination. 

Federal financial regulators and Treasury jointly or separately issued 
the 36 rules pursuant to the Dodd-Frank Act that were found to be 
major rules. CFPB, CFTC, and SEC collectively accounted for 32 (close 
to 90 percent) of the rules. (See appendix III for a list of Dodd-
Frank rules classified as major.) Based on our review of the analyses 
provided by the agencies to OMB, we found that the agencies expect 
that all 36 rules will or could meet CRA's first major rule criterion--
that is, result in an annual effect on the economy of $100 million or 
more. In addition, and although a rule needs to meet only one of the 
multiple criteria in the CRA major rule definition to be considered 
major, agencies expect that 6 of the 36 major rules could cause a 
major increase in costs or prices and 3 of the rules could have a 
significant adverse effect on competition or other activities. 

The processes used by federal financial regulators and OMB to identify 
rules as major vary and create the potential for OMB to not identify 
all major rules. In 1999, OMB issued guidance on implementing CRA that 
outlined the process for identifying major rules.[Footnote 38] For 
rules subject to E.O. 12,866 review, the guidance instructs agencies, 
when submitting rules, to indicate whether they consider the rules 
major. For rules not subject to E.O. 12,866 review, agencies are 
instructed to contact their OMB desk officer, who has responsibility 
for certain agencies, in accordance with their established practice. 
Because the federal financial regulators are not subject to E.O. 
12,866, they submit rules to OMB per practices established with their 
OMB desk officers. Another difference is that agencies subject to E.O. 
12,866 generally would be required to prepare a comprehensive benefit-
cost analysis, quantifying benefits and costs where feasible, for 
significant regulatory actions. OMB desk officers can then use such 
analysis in determining whether a rule is major under CRA. In 
contrast, for rules not subject to the order, the agencies would not 
necessarily be required to conduct such an analysis. As a result, OMB 
desk officers may have less complete information from which to 
determine whether a rule is major under CRA. 

We found that regulators' established practices vary. For example, 
some federal financial regulators told us that they submit all of 
their rules to OMB for review, but three regulators told us that they 
submit only those rules they consider major based on their analyses. 
OMB officials told us that their expectation is that independent 
agencies should send all rules to their desk officers; otherwise, the 
desk officers cannot determine whether the rules are major as required 
under CRA. The risk of OMB not identifying a major rule is unknown, 
but one federal financial regulator we interviewed said that the 
agency tries to be conservative in its analyses--tending to 
overestimate rather than underestimate costs, thereby reducing the 
risk that a rule may not be identified as major. Additionally, OMB 
commonly relies on the issuing agency's expertise and analyses to 
classify rules as major. 

We also found examples that indicate that federal financial regulators 
and OMB may not be interpreting CRA's major rule definition or related 
OMB guidance consistently. 

* Applying CRA criteria to indirect consequences. Agencies differed in 
the way they treated indirect costs of their rules when considering 
whether such rules could have an impact of $100 million dollars or 
more annually on the economy. In 2012, CFTC and SEC jointly issued a 
rule to further define certain swap terms, including swap and security-
based swap.[Footnote 39] In its analysis, CFTC noted that the 
definitions, by themselves, would not have an annual effect on the 
economy of $100 million but will affect a number of other rules, 
including rules determined to be major rules. According to CFTC, these 
other rules could not be made effective without the final definitions 
rule; as a result, it concluded that the definitions rule would have 
an annual effect on the economy of more than $100 million. CFTC and 
SEC also jointly issued a rule to further define certain terms 
including swap dealer and security-based swap dealer.[Footnote 40] In 
its analysis, SEC noted that these definitions, by themselves, would 
not impose substantive requirements on dealers or major participants, 
but that the rule should be considered major because it would set 
boundaries that determine whether entities are subject to other rules, 
including ones determined to be major rules. In contrast, in 2012 FSOC 
issued a final rule on the process it intends to use for determining 
whether a nonbank financial company should be supervised by the 
Federal Reserve and subject to enhanced prudential standards.[Footnote 
41] Treasury officials noted that they believed the rule should not be 
considered major because the rule did not impose substantive 
requirements on any entities, but only laid out the process by which 
they could become subject to other rules and regulations.[Footnote 42] 
OMB agreed with Treasury's assessment and determined that the rule was 
not major. 

* Applying CRA criteria to related and jointly issued rules. CFPB 
combined two separate but related rules to estimate total costs in its 
CRA major rule assessment, but in other cases, agencies issuing 
separate but related rules have not combined the rules' costs or 
benefits. In 2013, CFPB issued two separate mortgage servicing rules 
that amended Regulation X and Regulation Z.[Footnote 43] In its CRA 
analysis submitted to OMB, CFPB estimated that Regulations X and Z 
would have an annual burden of $22 million in paperwork-related costs, 
and Regulation X would create an additional annual burden of $90 
million. CFPB noted that combining the rules results in a total cost 
of around $112 million and, thus, concluded that the final rules, 
together, were likely to result in an annual effect on the economy of 
$100 million or more.[Footnote 44] OMB agreed and identified both 
rules as major. In contrast, other federal financial regulators have 
issued related Dodd-Frank rules, but did not combine them in their CRA 
analysis. Had these separate but related rules been combined, they may 
have exceeded the $100 million threshold. Additionally, agencies 
jointly issued four major Dodd-Frank rules and, in each case, provided 
their analysis of the costs and benefits to OMB individually rather 
than cumulatively. OMB has not issued any guidance on the issue of 
whether rules should be considered separately or together for CRA 
purposes. OMB officials told us that they expect agencies to 
coordinate their CRA analyses on jointly issued rules but said such 
coordination may not always occur. 

* Applying OMB guidance for adding benefits and costs. OMB classified 
an SEC rule as major that combined benefits and costs to estimate the 
rule's annual effect, which could be contrary to its related guidance 
(discussed below). In 2011, SEC issued a final rule implementing 
various amendments that the Dodd-Frank Act made to the Investment 
Advisers Act.[Footnote 45] In its analysis, SEC noted that it is not 
able to quantify some of the costs associated with the rule, but the 
costs it was able to estimate totaled about $55.9 million for the 
first year. SEC further noted that it was unable to quantify the 
benefits of the new rules but believes they will be substantial and, 
together with costs, will result in an annual effect on the economy of 
more than $100 million. In its February 2011 guidance on E.O. 12,866 
regarding economically significant regulatory actions (which does not 
apply to independent regulatory agencies), OMB noted that under the 
executive order, agencies must submit a regulatory impact analysis for 
economically significant regulatory actions, defined (1) to have an 
annual effect on the economy of $100 million or more or (2) to 
adversely affect in a material way the economy; productivity; 
competition; jobs; the environment; public health or safety; or state, 
local, or tribal governments or communities.[Footnote 46] The guidance 
notes that the $100 million threshold includes benefits, costs, or 
transfers, and is identical to the threshold for determining whether a 
rule is major under CRA. The guidance highlighted the word "or" to 
indicate that benefits and costs should not be combined. 

Although OMB issued a memorandum in 1999 to instruct agencies on how 
to implement CRA, the memorandum provided little guidance on how 
agencies should apply CRA's major rule criteria--particularly its $100 
million threshold. However, as illustrated by our examples, the 
criteria can be applied in different ways. The only related OMB 
guidance on applying CRA's $100 million threshold was included in the 
February 2011 guidance that provided answers to frequently asked 
questions about the regulatory impact analysis required by E.O. 12,866 
and OMB Circular A-4, to which independent regulatory agencies are not 
subject. According to OMB staff, the guidance was not offered to 
independent agencies as additional guidance to implement CRA. Without 
specific guidance addressed to agencies that must comply with CRA on 
how to apply CRA's $100 million threshold, federal financial 
regulators may continue to inconsistently apply CRA's major rule 
criteria and thus, inconsistently advise OMB on whether to classify 
rules as major. To the extent that any major rules are not being 
classified as such, those rules may become effective before the end of 
the 60-day congressional review period required under CRA. On the 
other hand, our third example also shows that some rules may be 
potentially misclassified as major and may not be made effective for 
60 days after their submission to Congress or publication in the 
Federal Register when such a delay is not required. 

Regulators Continue to Coordinate on Rulemakings: 

Federal agencies coordinated on 49 of the 70 Dodd-Frank regulations 
that we reviewed, as required by the act or voluntarily. The act also 
requires CFPB to coordinate with federal and state regulators in its 
supervision of certain banks and nonbanks that offer or provide 
consumer financial products or services. To date, CFPB has established 
a framework to coordinate with prudential regulators and is 
establishing a similar framework to coordinate with state regulators. 

Federal Financial Regulators Have Continued to Coordinate on Their 
Dodd-Frank Rulemakings: 

Generally, federal financial regulators recognize the importance of 
interagency coordination during the rulemaking process. Coordination 
during the rulemaking process occurs when two or more regulators 
jointly engage in activities for a purpose such as reducing 
duplication and overlap in regulations. Effective coordination can 
help regulators minimize or eliminate staff and industry burden, 
administrative costs, conflicting regulations, unintended 
consequences, and uncertainty among consumers and markets. As we 
reported last year, agency staffs told us that most interagency 
coordination during rulemaking largely was informal and conducted at 
the staff level.[Footnote 47] For example, regulators held some formal 
interagency meetings early on in the Dodd-Frank rulemaking process, 
but subsequent coordination on specific rulemakings was mostly 
informal and conducted through e-mail, telephone conversations, and 
one-on-one conversations between staff, including several interagency 
meetings and teleconferences. 

Recognizing the importance of coordination, the Dodd-Frank Act imposes 
interagency coordination or consultation requirements and 
responsibilities on regulators or in connection with certain rules. 
Dodd-Frank coordination requirements include topic-specific, agency-
specific, and rule-specific requirements. For example: 

* Under Title VII, SEC and CFTC must coordinate and consult with each 
other and prudential regulators, to the extent possible, before 
starting a rulemaking or issuing an order on swaps or swap-related 
subjects. This requirement's purpose is to assure regulatory 
consistency and comparability across the rules or orders. Title VII 
also directs CFTC, SEC, and the prudential regulators to coordinate 
with foreign regulators, as appropriate, in implementing swap reform 
regulations. 

* Under Title X of the act, CFPB is required to consult with the 
appropriate prudential regulators or other federal agencies, both 
before proposing a rule and during the comment process, on consistency 
with prudential, market, or systemic objectives administered by such 
agencies. 

* Section 165(i) requires certain financial institutions to conduct 
annual or semi-annual stress tests and directs regulators to issue 
consistent and comparable regulations implementing the stress test 
requirement in coordination with the Federal Reserve and Federal 
Insurance Office. 

* Section 201(b) provides that, for the purpose of defining "financial 
company," no company shall be deemed to be predominantly engaged in 
activities that the Federal Reserve has determined are financial in 
nature or incidental to such financial activities, if the consolidated 
revenues of that company from such activities constitute less than 85 
percentage of the total consolidated revenues of that company, as 
FDIC, in consultation with Treasury, shall establish by regulation. 

We found evidence of coordination between the rulemaking agency and 
other regulators for 49 of the 70 regulations that we reviewed (see 
appendix IV). We found the act required coordination, or it was 
unclear whether the act required coordination, in 39 of these 49 
rulemakings.[Footnote 48] We reviewed the rulemakings to document 
evidence of coordination among the agencies and also interviewed 
agency staff about their coordination efforts for the 39 rules. We 
found the following: 

* Twelve rules issued by CFTC and SEC implemented provisions in Title 
VII related to swaps and, thus, required coordination with each other 
and the prudential regulators to the extent possible.[Footnote 49] For 
example, CFTC specified that it coordinated with SEC on nine of the 
swap-related rules issued solely by CFTC, and with the prudential 
regulators, among others, on five of these nine rules. 

* CFPB indicated that it coordinated with prudential or other federal 
regulators, pursuant to Title X of the act, on 17 of its rulemakings 
under federal consumer financial laws.[Footnote 50] CFPB noted that it 
consulted or offered to consult with the prudential regulators on all 
17 rules and the Federal Trade Commission, the Department of Housing 
and Urban Development, or other agencies on many of its rules. 

* For the other 10 rules where coordination was mandated, we found 
that CFTC, FDIC, the Federal Reserve, OCC, or SEC coordinated in 
response to rule-specific interagency coordination requirements in the 
act. 

For 10 of the 49 rules, there was no Dodd-Frank requirement to 
coordinate, but we found evidence that the agencies voluntarily 
coordinated on the rulemakings. Most federal financial regulatory 
officials told us that they generally voluntarily engage in 
interagency coordination when their rules affect another agency or its 
supervised entities or when another agency has expertise that can 
inform their rulemakings.[Footnote 51] 

We also found evidence of international coordination on six swap-
related rules in our scope.[Footnote 52] CFTC issued the six rules and 
noted that it coordinated with international bodies, such as the 
European Securities Markets Authority, European Central Bank, and 
regulators in the United Kingdom, Japan, Hong Kong, Singapore, Sweden, 
and Canada (see appendix IV). CFTC and SEC staffs said that while they 
may coordinate with international bodies on specific rules, they also 
are active participants in various international bodies, such as those 
engaged in global derivatives reforms. For example, CFTC and SEC are 
members of the International Organization of Securities Commissions' 
Over-the-Counter (OTC) Derivatives Regulation Task Force, Financial 
Stability Board's OTC Derivatives Working Group, and OTC Derivatives 
Regulators' Forum. These groups all work, in part, to share 
information or encourage communication and promote consistency in OTC 
derivatives reforms.[Footnote 53] CFTC and SEC also have developed 
supervisory cooperation arrangements or memoranda of understanding 
(MOU) with foreign authorities in major jurisdictions where regulated 
entities are located.[Footnote 54] According to CFTC staff, these 
coordination efforts may inform CFTC's rulemaking. 

In our November 2011 report, we recommended that FSOC work with the 
federal financial regulators to establish formal coordination policies 
for rulemaking that clarify issues, such as when coordination should 
occur, the process that will be used to solicit and address comments, 
and what role FSOC should play in facilitating coordination.[Footnote 
55] While FSOC has a coordination framework, we found at that time 
that the framework did not provide, nor according to FSOC staff was it 
intended to provide, any specifics about staff responsibilities or 
processes to facilitate coordination. To date, FSOC has not 
implemented this recommendation. According to FSOC staff, the agency 
has written protocols for coordinating on rules for which coordination 
is required under the Dodd-Frank Act. For these and other Dodd-Frank 
rules, FSOC's Deputies Committee, composed of senior representatives 
of its members, and six functional committees, provide a forum in 
which agencies can coordinate or consult with each other. The Deputies 
Committee meets every two weeks to discuss FSOC's agenda and 
coordinate and oversee the work of the six functional committees. 
However, as we previously reported, a number of industry 
representatives believe FSOC could play a greater role in coordinating 
member agencies' rulemaking efforts.[Footnote 56] We further noted 
that the FSOC chairperson, in consultation with the other FSOC 
members, is required to regularly consult with the financial 
regulatory entities and other appropriate organizations of foreign 
governments or international organizations on matters relating to 
systemic risk to the international financial system. At a March 2013 
congressional hearing, an FSOC official testified that Congress did 
not provide FSOC or its chairperson with authority to require its 
member agencies to coordinate in all cases, nor did the Dodd-Frank Act 
change the statutory independence of FSOC's member agencies.[Footnote 
57] He noted that FSOC, nevertheless, will continue to seek to 
identify ways to further enhance collaboration through FSOC's 
committees and working groups. We continue to maintain that FSOC, 
working together with member agencies, should develop formal 
coordination policies, which could lead to improved coordination of 
rulemakings. 

CFPB Has a Framework to Coordinate with Prudential Regulators and Is 
Establishing One with State Regulators: 

Under the Dodd-Frank Act, CFPB is authorized to supervise insured 
depository institutions and credit unions with more than $10 billion 
in assets (large banks) and their affiliates, and nonbank financial 
service providers (nonbanks).[Footnote 58] The statutory requirements 
for CFPB supervision of large banks and nonbanks largely are the same 
and include (1) examining such entities to assess, among other things, 
their compliance with federal consumer financial laws, (2) 
coordinating with other federal and state regulators, and (3) using, 
where possible, publicly available information and existing reports 
from federal or state regulators pertaining to supervised entities. 
CFPB launched its large bank and nonbank supervision programs in July 
2011 and January 2012, respectively. CFPB has established a framework 
to comply with Dodd-Frank's requirements to coordinate supervision 
with prudential regulators and is establishing a similar framework to 
comply with the act's coordination requirements with state regulators. 

CFPB Has Established a Framework to Coordinate with Prudential 
Regulators: 

While CFPB oversees large banks--that is, insured depository 
institutions and credit unions with more than $10 billion in assets--
and their affiliates for compliance with federal consumer financial 
laws, prudential regulators also oversee the same entities for safety 
and soundness purposes and compliance with other laws and regulations. 
CFPB began operating its large bank supervision program in July 2011 
and examining banks shortly thereafter. As of March 31, 2013, CFPB 
supervised 112 large banks and 37 affiliated banks.[Footnote 59] OCC 
is the prudential regulator for 61 of the large banks, and FDIC, the 
Federal Reserve, and NCUA are the prudential regulators for 26, 21, 
and 4 of the other large banks, respectively. 

The Dodd-Frank Act requires CFPB and prudential regulators to 
coordinate their supervision of large banks and their affiliates to 
minimize regulatory burden. Specifically, CFPB and prudential 
regulators must (1) coordinate the scheduling of examinations of large 
banks and their affiliates; (2) conduct simultaneous examinations of 
large banks and their affiliates, unless otherwise requested by the 
institution; (3) share draft reports of such examinations with each 
other and provide the other regulator with at least 30 days to comment 
on the draft report before finalizing it; and (4) take into 
consideration any concerns raised by the other regulator before 
issuing the final examination report.[Footnote 60] Additionally, the 
act states that CFPB shall, to the fullest extent possible, use 
existing reports of supervised entities that have been provided to a 
federal or state regulator and information that has been reported 
publicly, and coordinate requirements regarding reports to be 
submitted by supervised entities.[Footnote 61] 

To meet the statutory requirements for coordination, CFPB has 
developed a framework to coordinate its supervisory activities with 
the prudential regulators. The framework consists primarily of (1) an 
MOU between CFPB and the prudential regulators and (2) CFPB's 
examination tools, which may be used to help ensure the required 
coordination is conducted, documented, and reviewed.[Footnote 62] 

MOU for Coordinating. In May 2012, CFPB and the prudential regulators 
entered into an MOU to facilitate their compliance with Dodd-Frank's 
coordination requirements.[Footnote 63] The MOU includes sections that 
define key terms, establish guidelines for simultaneous and 
coordinated examinations, and set forth agreements and expectations 
for sharing information. In light of the act's coordination 
requirements, the MOU: 

* establishes guidelines for coordinating examinations, in part by 
having each regulator designate a point of contact for each bank and 
affiliates, and directing the points of contact to consult with each 
other on the scheduling of examinations and to reach agreement on a 
timetable for sharing scheduling information, such as the scope, 
estimated start date and duration, and estimated staffing of the 
examination; 

* documents that the regulators generally will conduct their 
examinations of large banks and their bank affiliates in a 
simultaneous manner and defines the term "simultaneous examination;" 
[Footnote 64] 

* documents that CFPB and the relevant prudential regulator will 
provide the receiving agency at least 30 days to comment on a draft 
report and will consider any comments provided before finalizing the 
report; and: 

* documents that CFPB and the prudential regulators will share 
material supervisory information, including final supervisory letters 
or actions; final examination reports, including those related to 
safety and soundness or financial condition; and other material 
supervisory information that the CFPB and the prudential regulators 
agree to share.[Footnote 65] 

According to officials from CFPB and prudential regulators, the MOU 
serves as a roadmap to guide supervisory coordination, but its 
implementation is a work in progress. Included in the MOU is a 
provision under which the agencies agree to review the MOU's operation 
after the first year of its execution and to consider revisions needed 
to better accomplish the MOU's objectives. Officials told us that the 
review currently is underway and may become an annual undertaking. 

Examination Coordination Tools. CBPB's Supervision and Examination 
Manual informs examiners about coordination requirements throughout 
the four phases of CFPB's examination cycle.[Footnote 66] For the 
monitoring phase, where examiners maintain reasonably current 
information about a bank's activities and risks to consumers or 
markets, the manual instructs examiners to review supervisory and 
public information about the bank, including prudential and state 
regulators' examination reports, and to contact the bank's prudential 
regulator to discuss any new issues raised by the information. For the 
pre-examination planning phase, where the examiner-in-charge collects 
information necessary to determine the examination's scope, resource 
needs, and work plan, the manual directs the examiner-in-charge to 
review and update the monitoring information and request other 
relevant information from prudential and state regulators. In this 
phase, the examiner-in-charge prepares an information request for the 
supervised entity with a tailored list of information to be provided 
to examiners at the examination. In preparing this list, the manual 
directs examiners to coordinate the request with prudential and state 
regulators and keep them abreast of monitoring efforts, correspondence 
with the supervised entity, and schedule planning. For the examination 
phase, the manual instructs examiners to communicate regularly with 
the bank's prudential regulator. Lastly, in closing an examination, 
the manual instructs the examiner-in-charge to share the examination 
draft report with the prudential regulator, provide it with no less 
than 30 days for review and comment, and consider any concerns before 
issuing a final examination report. 

CFPB also has created electronic forms that examiners use to 
facilitate and document their compliance with the coordination 
requirements. For example, in the monitoring phase, examiners must 
complete or update a form to document information about CFPB's 
coordination with the prudential or state regulators, including 
examination schedules. For the planning stage, CFPB has created an 
information request form that includes standardized text to inform the 
supervised entity that it generally need not provide documents to CFPB 
that it has provided to prudential regulators. According to CFPB 
officials, examiners also are instructed to provide the prudential 
regulator a copy of the information request. In closing the 
examination, CFPB has a form for preparing the examination letter sent 
to the supervised entity summarizing the examination findings. The 
form includes a field for carbon copying the letter to the prudential 
or state regulator. 

The electronic storage of examination workpapers in CFPB's Supervision 
and Examination System facilitates supervisory review for compliance 
with, among other things, coordination requirements.[Footnote 67] All 
examination workpapers and related documentation (including reports 
and other information collected from prudential regulators) must be 
maintained in electronic form and uploaded to the system.[Footnote 68] 
As such, the system includes records of examination schedules, dates 
on which examination report drafts were sent to prudential regulators, 
and comments received from the prudential regulators.[Footnote 69] 
Examiners-in-charge and, in turn, management, are required to review 
and sign off on the adequacy of the workpapers. Such reviews provide a 
mechanism to help ensure that CFPB is complying with its statutory 
coordination requirements as delineated in the MOU. In addition, 
CFPB's manual notes that examination workpapers will be reviewed 
through an internal quality control process. 

Although CFPB has developed these tools to help coordinate 
examinations with prudential regulators, some members of Congress have 
raised concerns about CFPB's information collection activities or 
practices and the potential for overlap between CFPB's information 
collection efforts and other regulators' efforts. We have ongoing work 
examining these and related issues for several members of Congress. 

CFPB Is Establishing a Framework to Coordinate Its Supervisory 
Activities with State Regulators: 

State-chartered banks are subject to the supervision of their state 
banking regulators. Thus, certain large banks and their affiliates may 
be supervised by CFPB, a prudential regulator, and a state regulator. 
In addition, CFPB may share supervisory jurisdiction over certain 
nonbank entities in the mortgage origination and servicing, private 
education loan, payday loan, consumer reporting, and debt collection 
markets with state regulators overseeing these markets.[Footnote 70] 
CFPB started examining mortgage lenders, brokers, and servicers and 
payday lenders in the first half of 2012. Since that time, it has also 
begun examining nonbanks in the consumer reporting and debt collection 
markets. 

The Dodd-Frank Act requires CFPB and state regulators to coordinate 
their supervision of large banks and nonbanks to minimize regulatory 
burden.[Footnote 71] The act states that CFPB shall coordinate 
supervisory activities, including examinations and requirements 
regarding information requests, with state regulators.[Footnote 72] As 
mentioned earlier, the act also states that CFPB shall, to the fullest 
extent possible, use existing reports of supervised entities that have 
been provided to federal or state regulators and information that has 
been reported publicly.[Footnote 73] In supervising nonbanks, CFPB 
must consult with state regulators on requirements or systems, 
including coordinated or combined systems for registration, where 
appropriate.[Footnote 74] 

CFPB has entered into agreements with state regulators to address 
coordination requirements for supervising nonbanks and is beginning to 
implement those agreements. CFPB established an information-sharing 
MOU with the Conference of State Bank Supervisors (CSBS) and state 
regulators in January 2011; according to CFPB officials, over 60 state 
regulators have signed this or similar MOUs with CFPB.[Footnote 75] 
The MOUs memorialize agreements on how to handle and protect any 
information that is shared, minimize burden on supervised entities, 
and promote consistent examination standards, primarily through the 
development of a framework for coordinating supervisory 
activities.[Footnote 76] In May 2013, CFPB and CSBS, on behalf of the 
state regulators, agreed on a supervisory coordination framework. As 
part of the framework, CFPB and CSBS agreed to establish a State 
Coordinating Committee that would be in charge of coordinating with 
CFPB on nonbank supervision.[Footnote 77] CFPB officials told us that 
CFPB and state regulators are implementing the framework but much work 
remains. 

CFPB has not yet undertaken rulemakings to require nonbanks to 
register and, thus, has not formally begun efforts to coordinate 
registration systems with state regulators. According to its website, 
the Nationwide Mortgage Licensing System, owned and maintained by the 
State Regulatory Registry, LLC, a wholly-owned subsidiary of CSBS, is 
the sole system for licensing mortgage companies for 54 state agencies 
and the sole system for licensing mortgage loan originators for 58 
state and territorial agencies.[Footnote 78] In February 2012, CSBS 
stated that it intends to expand the system to other markets and, in 
April 2012, announced that five state banking agencies were expanding 
their use of the system to license and supervise nonbanks beyond the 
mortgage industry.[Footnote 79] CFPB officials told us that the agency 
has not yet determined when it will issue rulemakings on registration 
of nonbanks. They said they have engaged in discussions with CSBS to 
determine whether and how CFPB should leverage that system for 
registering nonbanks but no determinations have been made. 

Impacts of the Dodd-Frank Act Are Uncertain, and Regulators Are 
Developing Plans to Review Rules Retrospectively: 

Federal financial regulators are continuing to implement reforms 
pursuant to the Dodd-Frank Act, but the full impact of the act remains 
uncertain. This uncertainty stems from a number of factors. In 
particular, the implementation of the reforms is being driven largely 
by rulemakings or other regulatory actions, but not all rules are 
finalized and effective. In addition, even when the act's reforms are 
fully implemented, it will take time for the financial services 
industry to comply with the array of new regulations--meaning 
additional time will need to elapse to measure the impact of the 
rules. Moreover, the evolving nature of implementation makes isolating 
the Dodd-Frank Act's effect on the U.S. financial marketplace 
difficult. This task is confounded by the many factors that can affect 
the financial marketplace, including factors that could have an even 
greater impact than the act. 

Recognizing these limitations and difficulties, we developed a 
multipronged approach to analyze current data and trends that might be 
indicative of some of the Dodd-Frank Act's initial impacts, as 
institutions react to issued and expected rules. First, we updated the 
indicators that we developed in our December 2012 report to monitor 
changes in certain characteristics of SIFIs, which are subject to 
enhanced prudential standards and oversight under the act.[Footnote 
80] Although the indicators may be suggestive of the act's impact, 
they do not identify causal links between their changes and the act. 
Further, many other factors can affect SIFIs and, thus, the 
indicators. Second, we also updated our difference-in-difference 
analysis to infer the act's impact on the provision of credit by and 
the safety and soundness of bank SIFIs. The analysis is subject to 
limitations, in part because factors other than the act could be 
affecting these entities. Third, we developed indicators to monitor 
the extent to which certain of the Dodd-Frank Act's swap reforms are 
consistent with the act's goals of reducing risk. Like our SIFI 
indicators, our swap indicators have limitations. For example, they do 
not identify causal links between changes in swap markets and the act 
or its regulations. Finally, we assessed agencies' plans to conduct 
retrospective reviews of their existing rules. 

Indicators Suggest Increased Resilience and Size of Large SIFIs 
between the Third Quarter of 2010 and the Second Quarter of 2013: 

According to its legislative history, the Dodd-Frank Act contains 
provisions intended to reduce the risk of failure of a large, complex 
financial institution and the damage that such a failure could do to 
the economy.[Footnote 81] Such provisions include (1) authorizing FSOC 
to designate a nonbank financial company for Federal Reserve 
supervision if FSOC determines it could pose a threat to U.S. 
financial stability and (2) directing the Federal Reserve to impose 
enhanced prudential standards and oversight on bank holding companies 
with $50 billion or more in total consolidated assets (referred to as 
bank SIFIs in this report) and nonbank financial companies designated 
by FSOC (referred to as nonbank SIFIs in this report). Federal 
agencies and regulators have been working to implement these 
provisions. For example, in January and December 2012, the Federal 
Reserve proposed its enhanced prudential standards rules for certain 
U.S. and foreign companies operating in the United States, 
respectively, and has finalized rules implementing some of these 
standards.[Footnote 82] In addition, FSOC designated two nonbank 
financial companies in July 2013 and a third in September 2013. (See 
appendix V for a summary of SIFI-related provisions and their 
rulemaking status.) 

As we reported last year, the Dodd-Frank Act and its implementing 
rules may result in adjustments to SIFIs' size, interconnectedness, 
complexity, leverage, or liquidity over time.[Footnote 83] We 
developed indicators to monitor changes in some of these SIFI 
characteristics. The size and complexity indicators reflect the 
potential for a single company's financial distress to affect the 
financial system and economy. The leverage and liquidity indicators 
reflect a SIFI's resilience to shocks or its vulnerability to 
financial distress. Like we did in our last report, we continue to 
focus our analysis on bank SIFIs, given that FSOC only recently 
designated three nonbank financial companies for Federal Reserve 
supervision.[Footnote 84] Our indicators have limitations. For 
example, the indicators do not identify causal links between changes 
in SIFI characteristics and the act. Rather, the indicators track 
changes in the size, complexity, leverage, and liquidity of SIFIs over 
the period since the Dodd-Frank Act was passed to examine whether the 
changes are consistent with the goals of the act. However, other 
factors--including the economic downturn, international banking 
standards agreed upon by the Basel Committee on Banking Supervision 
(Basel Committee), European debt crisis, and monetary policy actions--
also affect bank holding companies and, thus, the indicators.[Footnote 
85] These factors may have a greater effect than the Dodd-Frank Act on 
SIFIs. Furthermore, because a number of rules implementing SIFI-
related provisions have not yet been finalized, our indicators include 
the effects of these rules only insofar as SIFIs have changed their 
behavior in response to issued rules and in anticipation of expected 
rules. In this regard, our indicators provide baselines against which 
to compare future trends. 

Table 2 summarizes the changes in our bank SIFI indicators from the 
third quarter of 2010 through the second quarter of 2013 and allows 
for the following observations. (See appendix VI for more details on 
our indicators.) 

* First, the total number of bank SIFIs declined by three, including 
one large bank SIFI, over the period.[Footnote 86] Median assets and 
median market share (measured in assets) for large bank SIFIs 
increased over the period. Even with one less large bank SIFI by mid-
2013, the increase in the size of large bank SIFIs is consistent with 
an increase in the spillover effect posed by such SIFIs--that is, the 
potential for such a company's financial distress to affect the 
financial system and economy. In contrast, median assets and median 
market share declined for other bank SIFIs over the period; these 
trends are consistent with a decrease in the spillover effects of 
those bank SIFIs. 

* Second, our complexity indicator suggests that large U.S. bank SIFIs 
in the second quarter of 2013 continue to be relatively more complex 
than other U.S. bank SIFIs, but they generally decreased their total 
number of legal entities over the period. In addition, four 2013 large 
bank SIFIs decreased their number or percentage of foreign legal 
entities, while the number of countries where their foreign legal 
entities operated decreased or remained stable over the period. In 
contrast, two 2013 large bank SIFIs increased both their number and 
percentage of foreign legal entities, and for one of them the number 
of countries where its foreign entities operated increased by 50 
percent. Because of the mixed trends, the change in the spillover 
effects is unclear. 

* Third, our indicators suggest that bank SIFIs, on average, have 
decreased their leverage from the third quarter of 2010 to the second 
quarter of 2013, although one of our measures shows that leverage for 
bank SIFIs did not change substantially from mid-2012 to mid-2013. 
Similarly, our liquidity indicators show that bank SIFIs improved 
their liquidity over the period, although one of our measures shows 
that large bank SIFIs' liquidity deteriorated from mid-2012 to mid-
2013. Despite these recent trends, the changes in our leverage and 
liquidity indicators from the third quarter of 2010 through the second 
quarter of 2013 are consistent with an improvement in SIFIs' 
resilience to shocks or vulnerability to financial distress. 

Table 2: Summary of Trends in Indicators for Bank SIFIs, from Third 
Quarter 2010 through Second Quarter 2013: 

Characteristic: Size - Size captures the amount of financial services 
or financial intermediation that a bank holding company provides; 
Indicator (italicized) and description of trend: The number of large 
bank SIFIs declined by one, and the number of other bank SIFIs declined 
by two. Median assets for large bank SIFIs increased and median assets 
for other bank SIFIs decreased. The median market share (measured in 
assets) for large bank SIFIs increased and median market share for the 
other bank SIFIs decreased; 
Consistent with decreased, no change, or increased spillover effects 
or resilience? Consistent with an increase in spillover effects of 
large bank SIFIs. Consistent with a decrease in spillover effects of 
other bank SIFIs. 

Characteristic: Interconnectedness - Interconnectedness captures 
direct or indirect linkages between financial institutions that may 
transmit distress from one institution to another; 
Indicator (italicized) and description of trend: None; 
Consistent with decreased, no change, or increased spillover effects 
or resilience? N/A. 

Characteristic: Complexity - Operational complexity may reflect an 
institution's diverse lines of business and locations in which the 
institution operates; 
Indicator (italicized) and description of trend: The median number of 
legal entities for large bank SIFIs decreased from 4,991 to 3,682[A], 
Four large bank SIFIs decreased their number or percentage of legal 
entities located outside of the United States, and the number of 
countries where their foreign entities are located remained stable or 
decreased. For the two other large bank SIFIs, the number and 
percentage of foreign legal entities increased and, for one of them, 
the number of countries where the foreign entities are located 
increased; 
Consistent with decreased, no change, or increased spillover effects 
or resilience? Unclear. 

Characteristic: Leverage - Leverage can be defined broadly as the ratio 
between some measure of risk exposure and capital that can be used to 
absorb unexpected losses from the exposure. Traditionally, it has 
referred to the use of debt, instead of equity, to fund an asset and 
been measured by the ratio of total assets to equity on the balance 
sheet; 
Indicator (italicized) and description of trend: The median tangible 
common equity as a percentage of total assets for large and 
other bank SIFIs increased. The median tangible common equity as a 
percentage of risk-weighted assets for large and other bank SIFIs 
increased; 
Consistent with decreased, no change, or increased spillover effects 
or resilience? Consistent with an increase in resilience. 

Characteristic: Liquidity - Liquidity represents the ability of an 
institution to fund its assets and meet its obligations as they become 
due; 
Indicator (italicized) and description of trend: The median short-term 
liabilities as a percentage of total liabilities for large and other 
bank SIFIs decreased. The median liquid assets as a percentage of 
short-term liabilities for large and other bank SIFIs increased; 
Consistent with decreased, no change, or increased spillover effects 
or resilience? Consistent with an increase in resilience. 

Sources: GAO analysis of data from the Federal Reserve Bank of Chicago, 
Bureau of Economic Analysis, and Federal Reserve Board. 

[A] Trends for our complexity indicators describe changes from June 30, 
2010, through June 30, 2013. 

Note: Large bank SIFIs are those with $500 billion or more in assets. 
Other bank SIFIs are those with assets between $50 billion and $500 
billion. To calculate the median measures, we calculated the relevant 
indicator measure for each bank holding company, and then reported the 
median for large bank SIFIs, the median for other bank SIFIs, the 
median for non-SIFI banks, or the median for the entire group. See 
appendix VI for additional information on our SIFI indicators. 

[End of table] 

Enhanced Prudential Standards Are Associated with Improved Safety and 
Soundness of Bank SIFIs but Not with Changes in the Cost of Credit 
since Mid-2010: 

According to our updated regression analysis, the Dodd-Frank Act has 
not been associated with a change in the cost of credit provided by 
U.S. bank SIFIs, but has been associated with an increase in the 
safety and soundness of the SIFIs.[Footnote 87] As we have noted, the 
Dodd-Frank Act requires the Federal Reserve to impose a variety of 
regulatory reforms on SIFIs, including enhanced risk-based capital, 
leverage, and liquidity requirements. These reforms may affect the 
safety and soundness of bank SIFIs and the cost and availability of 
credit provided by bank SIFIs. Although capital and leverage 
requirements may help reduce the probability of bank failures and 
promote financial stability, they could cause banks to raise lending 
rates and limit their ability to provide credit, especially during a 
crisis. Similarly, while stricter liquidity requirements may help 
reduce the probability of bank failures and promote financial 
stability, banks could respond to these requirements by increasing 
lending spreads to offset lower yields on assets or longer maturities 
on liabilities. To the extent that they increase the cost and reduce 
the availability of credit, these reforms may lead to reduced output 
and economic growth.[Footnote 88] 

Our econometric analysis assesses the initial impact of the Dodd-Frank 
Act's new requirements for bank SIFIs on (1) the cost of credit they 
provide and (2) their safety and soundness. Our analysis leverages the 
Dodd-Frank Act's requirement that bank holding companies with total 
consolidated assets of $50 billion or more are subject to enhanced 
regulation by the Federal Reserve but other bank holding companies are 
not. Specifically, we compare funding costs, capital adequacy, asset 
quality, earnings, and liquidity for bank SIFIs and non-SIFI bank 
holding companies before and after the enactment of the Dodd-Frank 
enhanced prudential requirements. All else being equal, the difference 
in the comparative differences is the inferred effect of the Dodd-
Frank Act's prudential requirements on bank SIFIs. 

Our approach allows us to partially differentiate changes in funding 
costs, capital adequacy, asset quality, earnings, and liquidity 
associated with the Dodd-Frank Act from changes due to other factors. 
However, several factors make isolating and measuring the impact of 
the Dodd-Frank Act's new requirements for SIFIs challenging. The 
effects of the act cannot be differentiated from the effects of 
simultaneous changes in economic conditions, such as the pace of the 
recovery from the recent recession, or regulations, such as those 
stemming from Basel III, or other changes, such as in credit ratings 
that differentially may affect bank SIFIs and other bank holding 
companies. In addition, many of the new requirements for SIFIs have 
yet to be implemented. For example, the Federal Reserve is required to 
implement enhanced prudential standards, including capital 
requirements, stress testing, liquidity requirements, single-
counterparty credit limits, an early remediation regime, and risk-
management and resolution planning. Only rules for resolution planning 
and stress testing have been finalized.[Footnote 89] Additionally, the 
Federal Reserve has proposed to implement a quantitative liquidity 
requirement for bank holding companies, savings and loan holding 
companies, and depository institutions with more than $250 billion in 
total assets and has indicated that it plans to impose a capital 
surcharge on the largest SIFIs. Nevertheless, our estimates are 
suggestive of the initial effects of the Dodd-Frank Act on bank SIFIs 
and provide a baseline against which to compare future trends. 

Our estimates suggest that the Dodd-Frank Act has not been associated 
with a significant change in U.S. bank SIFIs' funding costs (table 3). 
To the extent that the cost of credit provided by bank SIFIs is a 
function of their funding costs, the new requirements for SIFIs likely 
have had little effect on the cost of credit to date. 

Table 3: Estimated Changes in U.S. Bank SIFIs' Funding Costs and 
Measures of Safety and Soundness Associated with the Dodd-Frank Act, 
from Third Quarter 2010 through Second Quarter 2013: 

Cost of credit indicator: 

Variable: Funding cost; 
Measured as: Interest expense as a percentage of interest-bearing 
liabilities; 
Estimated change and standard error of estimated change (percentage 
points): 0.02; (0.02); 
Estimated change statistically significant at the five percent level? 
No. 

Safety and soundness indicators: 

Variable: Capital adequacy; 

Measured as: Tangible common equity as a percentage of total assets; 
Estimated change and standard error of estimated change (percentage 
points): 1.50; (0.22); 
Estimated change statistically significant at the five percent level? 
Yes. 

Measured as: Tangible common equity as a percentage of risk-weighted 
assets; 
Estimated change and standard error of estimated change (percentage 
points): 2.02; (0.36); 
Estimated change statistically significant at the five percent level? 
Yes. 

Variable: Asset quality; 
Measured as: Performing assets as a percentage of total assets; 
Estimated change and standard error of estimated change (percentage 
points): 0.41; (0.13); 
Estimated change statistically significant at the five percent level? 
Yes. 

Variable: Earnings; 
Measured as: Earnings as a percentage of total assets; 
Estimated change and standard error of estimated change 
(percentage points): 0.09; (0.03); 
Estimated change statistically significant at the five percent level? 
Yes. 

Variable: Liquidity; 

Measured as: Liquid assets as a percentage of volatile liabilities; 
Estimated change and standard error of estimated change (percentage 
points): -1.80; (8.87); 
Estimated change statistically significant at the five percent level? 
No. 

Measured as: Stable liabilities as a percentage of total liabilities; 
Estimated change and standard error of estimated change (percentage 
points): 5.12; (1.01); 
Estimated change statistically significant at the five percent level? 
Yes. 

Source: GAO analysis of data from the Federal Reserve Bank of Chicago. 

Notes: We analyzed data for top-tier bank holding companies that filed 
form FR Y-9C from the first quarter of 2006 through the second quarter 
of 2013. We estimated the effects of the new SIFI requirements on bank 
SIFIs by regressing the variables listed in the table on indicators for 
each bank holding company, indicators for each quarter, indicators for 
whether a bank holding company is a SIFI for quarters from the third in 
2010 through the second in 2013, and other variables controlling for 
size, foreign exposure, securitization income, other nontraditional 
income, and participation in the Troubled Asset Relief Program. 
Estimated changes are the coefficients on the indicators for whether a 
bank holding company is a SIFI in quarters from the third in 2010 
through the second in 2013. We used t-tests to assess whether the 
coefficient on the SIFI indicator was significant at the 5 percent 
level. For more information on our methodology, see appendix VII. 

[End of table] 

Our estimates also suggest that the Dodd-Frank Act is associated with 
improvements in most measures of U.S. bank SIFIs' safety and 
soundness. As shown in table 3, bank SIFIs appear to be holding more 
capital than they otherwise would have held in every quarter since the 
Dodd-Frank Act was enacted. The quality of assets on the balance 
sheets of bank SIFIs also seems to have improved since the Dodd-Frank 
Act was enacted. The act is associated with higher earnings for bank 
SIFIs in the time period after the act's enactment. It is also 
associated with improved liquidity as measured by the extent to which 
a bank holding company is using stable sources of funding. The only 
measure that has not clearly improved since the act's enactment is 
liquidity as measured by the capacity of a bank holding company's 
liquid assets to cover its volatile liabilities. Thus, the Dodd-Frank 
Act appears to be broadly associated with improvements in most 
indicators of safety and soundness for U.S. bank SIFIs. (See appendix 
VII for more details on our regression analysis.) 

Swaps Indicators Provide Baselines for Assessing the Future Impact of 
Some Swap Reforms: 

In general, swaps are types of derivative contracts that involve 
ongoing exchanges of one or more assets, liabilities, or payments for 
a specified period. For example, swaps can be used to exchange fixed-
rate interest payments for floating interest payments based on market 
rates (one type of interest rate swap), or to protect against the 
default of a bond issuer (one type of credit default swap). Financial 
and nonfinancial firms use swaps and other derivatives to hedge risk, 
to speculate, or for other purposes. Unlike futures, which are 
standardized financial contracts that are traded on exchanges, swaps 
traditionally have been privately negotiated between two 
counterparties in the over-the-counter (OTC) market. Swaps include 
interest rate swaps, commodity-based swaps, equity swaps, and credit 
default swaps. 

In varying degrees and ways, swaps and other OTC derivatives played a 
role in the most recent financial crisis. As FSOC reported, credit 
default swaps (CDS), including AIG's large holdings of such swaps, 
exacerbated the crisis because they were not well understood by 
regulators or market participants.[Footnote 90] FSOC also noted that 
OTC derivatives generally were a factor in the propagation of risks 
during the recent crisis because of their complexity and opacity, 
which contributed to excessive risk taking, a lack of clarity about 
the ultimate distribution of risks, and a loss in market confidence. 
In that regard, the crisis illustrated that swaps and other OTC 
derivatives can contribute to systemic risk in at least two ways. 
First, while swaps can be used to manage risk and increase liquidity, 
swaps generally have not been subject to regulatory requirements for 
margin (i.e., collateral based on the market value of the swap). This 
allowed some swap participants to take large speculative positions 
using a relatively small amount of capital, thereby increasing 
leverage. Second, swaps increased the interconnectedness of the 
financial system by exposing many banks, financial entities, and end-
users to the credit risk of a small number of swap dealers. The 
concentration of most OTC derivatives trading among a small number of 
dealers created the risk that the failure of one of these dealers 
could expose counterparties to sudden losses and destabilize financial 
markets. 

Title VII of the Dodd-Frank Act establishes a new regulatory framework 
for swaps. The act authorizes CFTC to regulate "swaps" and SEC to 
regulate "security-based swaps" with the goals of reducing risk, 
increasing transparency, and promoting market integrity in the 
financial system. Title VII includes the following four major swaps 
reforms. 

* Registration and regulation. The title provides for the registration 
and regulation of swap dealers and major swap participants, including 
subjecting them to (1) prudential regulatory requirements, such as 
minimum capital and minimum initial and variation margin requirements 
and (2) business conduct requirements to address, among other things, 
interaction with counterparties, disclosure, and supervision.[Footnote 
91] 

* Mandatory clearing. The title imposes mandatory clearing 
requirements on swaps, but exempts, among others, certain end users 
that use swaps to hedge or mitigate commercial risk.[Footnote 92] 

* Exchange trading. The title requires swaps subject to mandatory 
clearing to be executed on an organized exchange or swap execution 
facility, unless no facility offers the swap for trading.[Footnote 93] 

* Mandatory reporting. The title requires all swaps to be reported to 
a registered swap data repository or, if no such repository will 
accept the swap, to CFTC or SEC, and subjects swaps to post-trade 
transparency requirements (real-time public reporting of certain swap 
data). 

Figure 1 illustrates these reforms and some of the differences between 
swaps traded on exchanges and cleared through clearinghouses and swaps 
traded in the OTC market. 

Figure 1: Overview of Clearing, Trading, and Reporting Requirements 
under Dodd-Frank Swaps Reforms: 

[Refer to PDF for image: illustration] 

Exchange-traded and centrally cleared swaps: 

As determined by CFTC or SEC, swaps that are required to be cleared 
must be submitted for clearing through a central counterparty (CCP or 
clearinghouse). Generally, swaps that are required to be cleared must 
be traded on an exchange or swap execution facility (SEF). 

Exchange or SEF: 
Executing trades through an exchange or SEF could improve pretrade 
price transparency. In OTC markets, customers had limited ability to 
observe swap prices; 
Counterparty 1: Trade to Exchange or SEF; margin to Central 
Counterparty (CCP); 
Counterparty 2: Trade to Exchange or SEF; margin to Central 
Counterparty (CCP). 

Central Counterparty (CCP): 
The CCP stands between the counterparties and guarantees all trades. A 
single transaction between two counterparties in effect becomes two 
contracts: one between each trader and the CCP. Credit risk remains as 
the CCP must meet its obligations. Counterparties are required to post 
margin with the CCP to protect against losses. 
Reporting: to Swap data repositories. Swaps, whether centrally cleared 
or traded OTC, must be reported to a data repository, CFTC, or SEC. 
Reporting and collection of swap data are intended to give CFTC and 
SEC a more complete picture of the derivatives markets. 

End-user exemption: The Dodd-Frank Act provides exceptions to the 
clearing requirement for cases where one of the counterparties to a 
trade is a “nonfinancial entity” and meets certain other requirements. 

Over-the-counter (OTC) swaps: 

Swaps not required to be cleared may be traded through dealers in the 
OTC market. The Dodd-Frank Act requires regulators to write rules 
setting capital and margin requirements for swaps. 

Swap dealer: 
In the OTC market, a network of dealers stand ready to take either 
long or short positions and earn income on spreads and fees. The 
dealer assumes the risk of customer default and the customer assumes 
the risk of dealer default.
Counterparty 1: Bilateral trade with Swap dealer; margin to Swap 
dealer; 
Counterparty 2: Bilateral trade with Swap dealer; margin to Swap 
dealer. 

Reporting: to Swap data repositories. Swaps, whether centrally cleared 
or traded OTC, must be reported to a data repository, CFTC, or SEC. 
Reporting and collection of swap data are intended to give CFTC and 
SEC a more complete picture of the derivatives markets. 

Source: GAO analysis of the Dodd-Frank Act. 

[End of figure] 

According to the Dodd-Frank Act's legislative history, key elements 
for reducing systemic risk include increasing the use of central 
clearinghouses and appropriate margining and capital for OTC 
derivatives.[Footnote 94] CFTC and SEC have issued final rules to 
implement many of the regulatory frameworks for clearing standardized 
swaps. In December 2012, CFTC issued a final rule establishing the 
first clearing requirement for four types of interest rate swaps and 
two types of CDSs.[Footnote 95] In July 2012, SEC issued a final rule 
on, among other things, the process that the agency will use to 
determine whether a security-based swap is required to be cleared but 
has not yet subjected any security-based swaps to the clearing 
requirement.[Footnote 96] CFTC, SEC, and the prudential banking 
regulators have proposed rules to implement Dodd-Frank's margin and 
capital requirements for swap entities, but as of September 2013, 
these rules have not yet been finalized.[Footnote 97] (See appendix 
VIII for tables listing select Dodd-Frank swap reform related 
rulemakings.) 

Once fully implemented, some provisions in Title VII of the act may 
help achieve the goal of reducing risk, in part by increasing the 
central clearing of swaps and posting of margin for uncleared swaps. 
We developed two sets of indicators to measure changes in (1) the 
central clearing of swaps and (2) the use of margin collateral for OTC 
derivatives. In this report, these indicators provide a baseline for 
measuring future changes in the central clearing of swaps and use of 
margin collateral, as the Dodd-Frank swap reforms have not been fully 
implemented. In future reports, we plan to update these indicators to 
determine whether changes in central clearing and the use of margin 
collateral are consistent with the act's swap reforms. Importantly, 
these indicators have several key limitations. First, changes in our 
indicators do not necessarily suggest a change in risk, because the 
intended outcomes of the swap reforms may not necessarily reduce 
systemic risk. For instance, experts, including those from the IMF, 
have noted that an increase in central clearing of swaps may not, by 
itself, reduce risk and may increase risk.[Footnote 98] Second, our 
indicators do not identify causal links between changes in swap market 
and the Dodd-Frank Act, including its regulations. Rather, the 
indicators begin to track changes in central clearing and 
collateralization in the swaps since the Dodd-Frank Act's passage to 
examine whether the changes are consistent with the act's swap reform 
goals for central clearing and collateralization. 

Central Clearing Indicators: 

Federal financial regulators have reported that mandatory clearing 
through clearinghouses for certain swaps can reduce risk and provide 
other benefits. As noted by CFTC, central clearing mitigates 
counterparty risk to the extent that the clearinghouse is a more 
creditworthy counterparty relative to the original swap participants. 
[Footnote 99] Clearinghouses have a variety of tools to monitor and 
manage counterparty risk, which include the contractual right to 
collect initial and variation margin associated with swap positions; 
issue margin calls whenever the margin in a customer's account has 
dropped below predetermined levels; and close out the swap positions 
of a customer that does not meet margin calls within a specified 
period. Further, to the extent that swap positions move from facing 
multiple counterparties in the OTC derivatives market to being run 
through a smaller number of clearinghouses, clearing may facilitate 
increased netting, which reduces operational risk and may reduce the 
amount of collateral that a counterparty must post or pay in terms of 
initial and variation margin. Although centralized clearing could 
remove a large portion of the interconnectedness of current OTC 
markets that leads to systemic risk, CFTC and others have noted that 
central clearing, by its nature, concentrates risk in a handful of 
entities. 

We developed two complementary clearing indicators. Our first 
indicator measures the gross notional amount of swaps that are 
required to be cleared and are being cleared as a percentage of the 
gross notional amount of swaps required to be cleared.[Footnote 100] 
This indicator shows the progress being made by market participants in 
complying with any mandatory clearing requirement.[Footnote 101] All 
else being equal, an increase in this indicator would be consistent 
with the act's swaps reforms. However, an increase in compliance with 
mandatory clearing requirements may not increase central clearing 
overall if market participants substitute away from swaps that are 
required to be cleared in favor of swaps that are not required to be 
cleared.[Footnote 102] To assess the extent to which market 
participants are substituting away from swaps that are required to 
clear, we complement our first indicator with a second indicator that 
measures the gross notional amount of swaps that are required to be 
cleared (but are not necessarily cleared) as a percentage of the total 
gross notional amount of the swaps market. This indicator shows the 
share of the swap market comprised by swaps identified for mandatory 
clearing and helps determine the extent to which changes in the first 
indicator represent increases in central clearing overall.[Footnote 
103] For example, an increase in the first indicator--the percentage 
of swaps that are required to be cleared that are cleared--would 
indicate an increase in central clearing overall if the second 
indicator--the percentage of all swaps that are required to clear--
does not decrease at the same time. In contrast, if the first 
indicator increases while the second decreases, then some of the 
increase in the first indicator likely is due to substitution away 
from swaps that are required to be cleared in favor of swaps that are 
not required to be cleared, which is not consistent with the act's 
swaps reforms. 

Our indicators cover only the interest rate swaps and CDS markets, 
because only certain of these types of swaps are currently subject to 
CFTC's mandatory clearing requirement.[Footnote 104] These are the two 
largest swaps markets. Based on CFTC's Swaps Report, the total gross 
notional amounts outstanding of the interest rate swap and CDS markets 
were about $419 trillion and $20 trillion, respectively, as of August 
30, 2013. The indicators are developed using data in the proposed 
version of CFTC's Swaps Report, which are estimates from a variety of 
sources that voluntarily submit the data.[Footnote 105] CFTC's final 
version of its Swaps Report will use data collected in response to 
Dodd-Frank provisions, and CFTC staff stated that the agency was 
working to implement this transition. 

Figure 2 shows the trends of our clearing indicators for interest rate 
swaps from January 2013 through August 2013. Our first indicator shows 
that market participants are making progress in meeting the clearing 
requirement: The percentage of swaps required to be cleared and that 
were cleared increased from around 53 percent to around 57 percent 
(based on gross notional amounts). Currently, not all interest rate 
swaps that are required to be cleared are being cleared, in part 
because CFTC is phasing in the requirement by staggering the 
compliance dates for different types of market participants and also 
because some nonfinancial entities that use swaps to hedge or mitigate 
commercial risk are exempt from the clearing requirement. The second 
indicator shows that interest rate swaps that are required to be 
cleared made up about 88 percent of the market (based on gross 
notional amount), and generally did not decrease during the period. 
This indicates that the increase in the first indicator represents an 
increase in central clearing that is consistent with the act's swaps 
reforms. 

Figure 2: Trends in Central Clearing of Interest Rate Swaps (by 
Percentage of Gross Notional Value of Swaps), from January 2013 
through August 2013: 

[Refer to PDF for image: line graph] 

Weekly data for 2013: 

January: 

IRS required to clear that cleared as a percent of IRS required to 
clear: 53%; 
IRS required to clear as a percent of total IRS: 88%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 53%; 
IRS required to clear as a percent of total IRS: 87%; 

February: 

IRS required to clear that cleared as a percent of IRS required to 
clear: 54%; 
IRS required to clear as a percent of total IRS: 88%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 54%; 
IRS required to clear as a percent of total IRS: 87%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 54%; 
IRS required to clear as a percent of total IRS: 88%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 54%; 
IRS required to clear as a percent of total IRS: 88%; 

March: 

IRS required to clear that cleared as a percent of IRS required to 
clear: 55%; 
IRS required to clear as a percent of total IRS: 88%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 55%; 
IRS required to clear as a percent of total IRS: 88%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 55%; 
IRS required to clear as a percent of total IRS: 88%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 53%; 
IRS required to clear as a percent of total IRS: 88%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 54%; 
IRS required to clear as a percent of total IRS: 88%; 

April: 

IRS required to clear that cleared as a percent of IRS required to 
clear: 55%; 
IRS required to clear as a percent of total IRS: 88%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 55%; 
IRS required to clear as a percent of total IRS: 88%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 54%; 
IRS required to clear as a percent of total IRS: 88%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 55%; 
IRS required to clear as a percent of total IRS: 88%; 

May: 

IRS required to clear that cleared as a percent of IRS required to 
clear: 55%; 
IRS required to clear as a percent of total IRS: 88%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 53%; 
IRS required to clear as a percent of total IRS: 87%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 55%; 
IRS required to clear as a percent of total IRS: 88%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 55%; 
IRS required to clear as a percent of total IRS: 88%; 

June: 

IRS required to clear that cleared as a percent of IRS required to 
clear: 55%; 
IRS required to clear as a percent of total IRS: 88%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 54%; 
IRS required to clear as a percent of total IRS: 87%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 65%; 
IRS required to clear as a percent of total IRS: 92%; 

July: 

IRS required to clear that cleared as a percent of IRS required to 
clear: 56%; 
IRS required to clear as a percent of total IRS: 88%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 56%; 
IRS required to clear as a percent of total IRS: 88%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 56%; 
IRS required to clear as a percent of total IRS: 88%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 56%; 
IRS required to clear as a percent of total IRS: 88%; 

August: 

IRS required to clear that cleared as a percent of IRS required to 
clear: 57%; 
IRS required to clear as a percent of total IRS: 88%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 57%; 
IRS required to clear as a percent of total IRS: 88%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 57%; 
IRS required to clear as a percent of total IRS: 88%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 57%; 
IRS required to clear as a percent of total IRS: 88%; 

IRS required to clear that cleared as a percent of IRS required to 
clear: 57%; 
IRS required to clear as a percent of total IRS: 88%. 

Source: GAO analysis of CFTC data. 

Note: The types of interest rate swaps that are required to clear are 
fixed-to-floating rate swaps, basis swaps, forward rate agreements, 
and overnight index swaps. We used weekly data from CFTC Swaps Reports 
for the period from January 2, 2013, to August 28, 2013, to calculate 
(1) the gross notional amount of interest rate swaps that are required 
to clear and that actually cleared as a percentage of the gross 
notional amount of interest rate swaps that are required to clear and 
(2) the gross notional amount of interest rate swaps that are required 
to clear as a percentage of the total gross notional amount of 
interest rate swaps. In its rule requiring central clearing of 
interest rate swaps, CFTC set the earliest compliance date for March 
2013. CFTC staff told us that they examined the rapid increase and 
decrease in the rate of central clearing of interest rate swaps on 
June 28, 2012 and July 5, 2012, respectively. CFTC staff told us that 
the change appeared to result largely from a decrease in uncleared 
interest rate swaps, and that they are looking further into the matter. 

[End of figure] 

Figure 3 shows the trends of our two clearing indicators for CDSs from 
January 2013 through August 2013. Our first indicator shows that, 
based on gross notional amount, about 27 percent of swaps required to 
be cleared were cleared at the end of the period, compared to about 24 
percent at the beginning of the period. The second indictor shows 
that, based on gross notional amount, CDSs required to be cleared 
accounted for about 35 percent of the market at the end of the period, 
compared to about 30 percent at the beginning of the period. This 
trend in the percentage of all CDSs that are required to clear is not 
consistent with market participants substituting away from CDSs that 
are required to clear in favor of CDSs that are not required to clear. 
It follows that the increase in the percentage of required-to-clear 
CDSs that cleared over the period generally is consistent with the 
act's swaps reforms. 

Figure 3: Percentage of Credit Default Swaps Centrally Cleared (by 
Gross Notional Value of Swaps), from January 2013 through August 2013: 

[Refer to PDF for image: line graph] 

Weekly data for 2013: 

January: 

CDS required to clear that cleared as a percent of CDS required to 
clear: 24%; 
CDS required to clear as a percent of total CDS: 30%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 24%; 
CDS required to clear as a percent of total CDS: 30%; 

February: 

CDS required to clear that cleared as a percent of CDS required to 
clear: 24%; 
CDS required to clear as a percent of total CDS: 31%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 22%; 
CDS required to clear as a percent of total CDS: 31%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 22%; 
CDS required to clear as a percent of total CDS: 31%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 22%; 
CDS required to clear as a percent of total CDS: 31%; 

March: 

CDS required to clear that cleared as a percent of CDS required to 
clear: 22%; 
CDS required to clear as a percent of total CDS: 31%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 22%; 
CDS required to clear as a percent of total CDS: 31%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 23%; 
CDS required to clear as a percent of total CDS: 31%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 24%; 
CDS required to clear as a percent of total CDS: 32%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 25%; 
CDS required to clear as a percent of total CDS: 32%; 

April: 

CDS required to clear that cleared as a percent of CDS required to 
clear: 24%; 
CDS required to clear as a percent of total CDS: 33%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 24%; 
CDS required to clear as a percent of total CDS: 33%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 25%; 
CDS required to clear as a percent of total CDS: 33%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 24%; 
CDS required to clear as a percent of total CDS: 33%; 

May: 

CDS required to clear that cleared as a percent of CDS required to 
clear: 25%; 
CDS required to clear as a percent of total CDS: 33%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 24%; 
CDS required to clear as a percent of total CDS: 33%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 24%; 
CDS required to clear as a percent of total CDS: 33%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 25%; 
CDS required to clear as a percent of total CDS: 34%; 

June: 

CDS required to clear that cleared as a percent of CDS required to 
clear: 25%; 
CDS required to clear as a percent of total CDS: 34%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 28%; 
CDS required to clear as a percent of total CDS: 34%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 27%; 
CDS required to clear as a percent of total CDS: 34%; 

July: 

CDS required to clear that cleared as a percent of CDS required to 
clear: 29%; 
CDS required to clear as a percent of total CDS: 34%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 27%; 
CDS required to clear as a percent of total CDS: 34%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 27%; 
CDS required to clear as a percent of total CDS: 34%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 27%; 
CDS required to clear as a percent of total CDS: 34%; 

August: 

CDS required to clear that cleared as a percent of CDS required to 
clear: 27%; 
CDS required to clear as a percent of total CDS: 34%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 27%; 
CDS required to clear as a percent of total CDS: 34%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 27%; 
CDS required to clear as a percent of total CDS: 35%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 27%; 
CDS required to clear as a percent of total CDS: 35%; 

CDS required to clear that cleared as a percent of CDS required to 
clear: 27%; 
CDS required to clear as a percent of total CDS: 35%. 

Source: GAO analysis of CFTC data. 

Note: The types of credit default swaps that are required to clear are 
untranched European and North American index credit default swaps. We 
used weekly data from CFTC Swaps Reports for the period from January 
2, 2013, to August 28, 2013, to calculate (1) the gross notional 
amount of credit default swaps that are required to clear and that 
actually cleared as a percentage of the gross notional amount of 
credit default swaps that are required to clear and (2) the gross 
notional amount of credit default swaps that are required to clear as 
a percentage of the total gross notional amount of credit default 
swaps. In its rule requiring central clearing of CDS, CFTC set the 
earliest compliance date for March 2013. 

[End of figure] 

Margin Indicators: 

We developed a second set of indicators to measure changes in the 
collection of margin collateral for OTC derivatives.[Footnote 106] The 
first margin indicator measures the fair value of collateral pledged 
by all counterparties to secure OTC derivatives contracts as a 
percentage of net current credit exposure to those counterparties for 
bank, financial, and savings and loan holding companies that reported 
positive credit exposure.[Footnote 107] The second set of margin 
indicators measures collateral pledged by different types of 
counterparties--banks and securities firms, monoline financial 
guarantors, hedge funds, sovereign governments, and corporations and 
all other counterparties--as a percentage of credit exposure to 
different types of counterparties. The net current credit exposure 
approximates the credit loss that a bank, financial, or savings and 
loan holding company would suffer if its counterparties defaulted on 
their OTC derivatives contracts.[Footnote 108] To protect itself from 
such a loss, a swap entity can require its counterparties to post 
margin collateral in an amount equal to or greater than the exposure 
of the contracts. An increase in these indicators would suggest that 
holding companies are requiring their counterparties to post a greater 
amount of collateral against their credit exposure due to derivatives 
contracts overall, which would be consistent with the purposes of the 
act's swap reforms. 

Although CFTC, SEC, and the prudential regulators have not finalized 
their margin rules for uncleared swaps, figures 4 and 5 show the 
trends in our margin indicators from the second quarter of 2009 
through the fourth quarter of 2012. Figure 4 shows that holding 
companies in our sample have increased the rate of collateralization 
of their net current credit exposure from OTC derivatives from 62 
percent to 82 percent over the period, suggesting that these holding 
companies are requiring their counterparties to post a greater amount 
of collateral against their derivatives contracts. However, as 
discussed later, aggregate measures of collateralization rates can 
mask differences in collateralization rates for different counterparty 
types. 

Figure 4: Fair Value of Collateral as a Percentage of Net Current 
Credit Exposure from OTC Derivatives Contracts for All Counterparty 
Types Combined, from Second Quarter 2009 through Second Quarter 2013: 

[Refer to PDF for image: line graph] 

Year and quarter: 

2009, Q2: 62%; 
2009, Q3: 63%; 
2009, Q4: 68%; 
2010, Q1: 68%; 
2010, Q2: 69%; 
2010, Q3: 71%; 
2010, Q4: 71%; 
2011, Q1: 72%; 
2011, Q2: 74%; 
2011, Q3: 67%; 
2011, Q4: 73%; 
2012, Q1: 76%; 
2012, Q2: 78%; 
2012, Q3: 77%; 
2012, Q4: 78%; 
2013, Q1: 83%; 
2013, Q2: 82%. 

Source: GAO analysis of Federal Reserve Bank of Chicago data. 

Note: To calculate the fair value of collateral as a percentage of net 
current credit exposure for all counterparty types, we used quarterly 
data on bank, financial, and savings and loan holding companies from 
form FR Y-9C for the period from second quarter 2009 to second quarter 
2013. For each quarter, we used data for all holding companies that 
reported positive net current credit exposure to at least one type of 
counterparty, and we divided total fair value of collateral pledged by 
all counterparty types for all of these holding companies by total net 
current credit exposure to all counterparty types for all of these 
holding companies. 

[End of figure] 

Figure 5 shows that the rate of collateralization of net current 
credit exposure from OTC derivatives has consistently differed by the 
type of counterparty, with hedge funds posting the most collateral as 
a percentage of credit exposure and sovereign governments typically 
posting the least. According to OCC, the rates differ, in part, 
because swap dealers may require certain counterparties, such as hedge 
funds, to post both initial and variation margin and other 
counterparties, such as banks and securities firms, to post only 
variation margin. Depending on how the margin rules are finalized, the 
rates of collateralization for some counterparties may increase. 

Figure 5: Fair Value of Collateral as a Percentage of Net Current 
Credit Exposure from OTC Derivatives Contracts by Counterparty Type, 
from Second Quarter 2009 through Second Quarter 2013: 

[Refer to PDF for image: multiple line graph] 

Year and quarter: 

2009, Q2; 
Banks & securities firms: 85.3%; 
Monoline financial guarantors: 1.2%; 
Hedge funds: 211.3%; 
Sovereign governments: 27.5%; 
Corporations and all other counterparties: 31.3%. 

2009, Q3; 
Banks & securities firms: 87.2%; 
Monoline financial guarantors: 1.2%; 
Hedge funds: 243.9%; 
Sovereign governments: 26.0%; 
Corporations and all other counterparties: 29.0%. 

2009, Q4; 
Banks & securities firms: 92.4%; 
Monoline financial guarantors: 1.2%; 
Hedge funds: 282.41%; 
Sovereign governments: 24.9%; 
Corporations and all other counterparties: 32.9%. 

2010, Q1; 
Banks & securities firms: 91.4%; 
Monoline financial guarantors: 1.0%; 
Hedge funds: 311.8%; 
Sovereign governments: 26.2%; 
Corporations and all other counterparties: 31.9%. 

2010, Q2; 
Banks & securities firms: 92.1%; 
Monoline financial guarantors: 1.6%; 
Hedge funds: 299.3%; 
Sovereign governments: 30.8%; 
Corporations and all other counterparties: 31.6%. 

2010, Q3; 
Banks & securities firms: 92.6%; 
Monoline financial guarantors: 1.7%; 
Hedge funds: 272.9%; 
Sovereign governments: 11.2%; 
Corporations and all other counterparties: 38.3%. 

2010, Q4; 
Banks & securities firms: 88.0%; 
Monoline financial guarantors: 1.7%; 
Hedge funds: 342.5%; 
Sovereign governments: 15.6%; 
Corporations and all other counterparties: 40.3%. 

2011, Q1; 
Banks & securities firms: 87.2%; 
Monoline financial guarantors: 3.2%; 
Hedge funds: 363.3%; 
Sovereign governments: 14.6%; 
Corporations and all other counterparties: 42.3%. 

2011, Q2; 
Banks & securities firms: 90.9%; 
Monoline financial guarantors: 3.2%; 
Hedge funds: 380.6%; 
Sovereign governments: 20.1%; 
Corporations and all other counterparties: 40.7%. 

2011, Q3; 
Banks & securities firms: 83.9%; 
Monoline financial guarantors: 3.9%; 
Hedge funds: 209.9%; 
Sovereign governments: 17.5%; 
Corporations and all other counterparties: 40.3%. 

2011, Q4; 
Banks & securities firms: 89.7%; 
Monoline financial guarantors: 10.0%; 
Hedge funds: 317.1%; 
Sovereign governments: 13.6%; 
Corporations and all other counterparties: 41.2%. 

2012, Q1; 
Banks & securities firms: 92.5%; 
Monoline financial guarantors: 10.9%; 
Hedge funds: 392.5%; 
Sovereign governments: 14.6%; 
Corporations and all other counterparties: 43.6%. 

2012, Q2; 
Banks & securities firms: 95.1%; 
Monoline financial guarantors: 10.2%; 
Hedge funds: 380.5%; 
Sovereign governments: 16.3%; 
Corporations and all other counterparties: 44.6%. 

2012, Q3; 
Banks & securities firms: 91.1%; 
Monoline financial guarantors: 12.3%; 
Hedge funds: 385.9%; 
Sovereign governments: 14.8%; 
Corporations and all other counterparties: 46.3%. 

2012, Q4; 
Banks & securities firms: 92%; 
Monoline financial guarantors: 14.3%; 
Hedge funds: 401.4%; 
Sovereign governments: 13.9%; 
Corporations and all other counterparties: 47.9%. 

2013, Q1; 
Banks & securities firms: 97.1%; 
Monoline financial guarantors: 20.7%; 
Hedge funds: 422.2%; 
Sovereign governments: 12.8%; 
Corporations and all other counterparties: 52.5%. 

2013, Q2; 
Banks & securities firms: 91.6%; 
Monoline financial guarantors: 29.4%; 
Hedge funds: 406.3%; 
Sovereign governments: 13.5%; 
Corporations and all other counterparties: 57.0%. 

Source: GAO analysis of Federal Reserve Bank of Chicago data. 

Note: To calculate the fair value of collateral as a percentage of net 
current credit exposure for each counterparty type, we used quarterly 
data on bank, financial, and savings and loan holding companies from 
form FR Y-9C for the period from second quarter 2009 to second quarter 
2013. For each quarter and for each counterparty type, we used data 
for all holding companies that reported positive net current credit 
exposure to that counterparty type, and we divided total fair value of 
collateral pledged by that counterparty type for all of these holding 
companies by total net current credit exposure to that counterparty 
type for all of these holding companies. 

[End of figure] 

Our margin indicators are subject to important limitations. First, 
both net current credit exposure and the fair value of collateral are 
as of a point in time because the fair values of derivatives contracts 
and collateral can fluctuate over time. Second, an average 
collateralization of 100 percent does not ensure that all current 
counterparty exposures have been eliminated, because one 
counterparty's credit exposures may be overcollateralized but another 
counterparty's credit exposure may be undercollateralized. Third, our 
indicators measure the fair value of the collateral held against net 
current credit exposures but do not necessarily measure the risk of 
uncollateralized losses. The fair value of net current credit exposure 
does not fully account for the riskiness of any single swap contract, 
so it is possible for the rate of collateralization to increase while 
the risk of uncollateralized losses also has increased, if a party has 
entered into riskier swaps. Fourth, there are over 1,000 holding 
companies in our sample, but less than 100 holding companies report 
positive credit exposure to counterparties in OTC derivatives 
contracts and five holding companies account for over 95 percent of 
the total gross notional amount of all derivatives contracts reported 
by all of the holding companies in our sample. Thus, trends in these 
indicators largely reflect collateralization rates for a small number 
of holding companies. Finally, these indicators do not reflect 
collateralization rates for companies, such as standalone broker-
dealers, that have credit exposure to counterparties in OTC 
derivatives contracts but are not affiliated with a bank, financial, 
or savings and loan holding company. 

Regulators Vary in Their Approaches and Progress in Developing 
Retrospective Review Plans: 

Federal financial regulators vary in their approaches and progress in 
developing and implementing plans to conduct retrospective reviews of 
their existing Dodd-Frank and other rules in recognition of Executive 
Order 13,579 (E.O. 13,579).[Footnote 109] Issued in July 2011, E.O. 
13,579 seeks to facilitate the periodic review of existing significant 
regulations by asking independent regulatory agencies to consider how 
best to promote retrospective analysis of rules that may be outmoded, 
ineffective, insufficient, or excessively burdensome. Retrospective 
reviews complement the prospective analysis that agencies conduct as 
part of their rulemaking (discussed above) and can provide insights on 
how regulations actually are working. E.O 13,579 represents the first 
time the President has issued an executive order to ask independent 
regulatory agencies to produce retrospective review plans for public 
scrutiny. But independent regulators, such as the federal financial 
regulators, are not required to follow this order. 

Most federal financial regulators told us that they were not 
developing retrospective review plans specifically in response to E.O. 
13,579. As a matter of policy or to satisfy statutory obligations, 
federal financial regulators generally had been conducting 
retrospective reviews before the issuance of E.O. 13,579. In that 
regard, the prudential regulators told us that they generally view 
their retrospective rule reviews conducted in accordance with statute 
or policy to be consistent with the order's principles and objectives. 
For example, prudential regulators noted that the Economic Growth and 
Regulatory Paperwork Reduction Act of 1996 (EGRPRA) requires them to 
review their regulations at least once every 10 years and identify and 
eliminate any regulatory requirements that are outdated, unnecessary, 
or unduly burdensome.[Footnote 110] The regulators reported on the 
results of their last EGRPRA review in July 2007, which was done over 
a 3-year period.[Footnote 111] During the review, the regulators 
undertook various efforts to reduce regulatory burden on their 
supervised institutions, including by streamlining supervisory 
processes. They also identified four areas to explore further for 
opportunities to revise regulations: suspicious activity reports, 
lending limits, the Basel II capital framework, and consumer 
disclosures. The next EGRPRA review must be completed by 2016. Three 
prudential regulators told us that they are actively planning for the 
review. According to one prudential regulator, CFPB, the Federal 
Reserve, FDIC, NCUA, and OCC, are working in a collaborative fashion 
under the auspices of the Federal Financial Institutions Examination 
Council to develop a program to conduct a comprehensive review of the 
regulations under EGRPGRA. In addition, some prudential regulators 
have conducted periodic, retrospective reviews of their existing rules 
as a matter of policy or practice. For example, NCUA has a policy of 
reviewing one-third of its rules on an annual basis, and the Federal 
Reserve has a policy of reviewing each of its rules at least once 
every 5 years. FDIC is undertaking a review of its regulations to 
eliminate and reduce unnecessary regulatory burden in light of the 
regulations it incorporated when it took on supervision of state-
charted thrifts upon the dissolution of the Office of Thrift 
Supervision. In addition, according to FDIC staff, the agency recently 
revised its policies, in part, to reaffirm its commitment to 
periodically undertake a review of each FDIC regulation and policy 
statement. Lastly, as part of its effort to integrate the Office of 
Thrift Supervision into its agency, OCC has been undertaking a 
comprehensive review of its and the Office of Thrift Supervision's 
regulations to eliminate duplication and reduce unnecessary regulatory 
burden. 

According to CFPB officials, the agency is not developing a 
retrospective review plan in response to E.O. 13,579 but, instead, is 
focusing on fulfilling its retrospective review requirements under 
section 1022 of the Dodd-Frank Act. Under the act, CFPB is required to 
assess retrospectively each significant rule or order adopted by CFPB 
under federal consumer financial law to address, among other things, 
the rule or order's effectiveness in meeting the act's purposes and 
goals. CFPB is required to publish a report of its assessment no later 
than 5 years after the rule or order's effective date, and is required 
to solicit public comment to inform its assessment. The officials said 
that they are in the initial stage of developing a review plan, which 
includes identifying what data will be needed and how such data can be 
collected, but have not yet drafted a plan. According to the 
officials, after the section 1022 reviews are completed and based on 
any lessons learned, CFPB may develop a plan pursuant to E.O. 13,579 
to review its existing rules on a recurring basis. In a related 
effort, CFPB requested public comment in December 2011 on streamlining 
regulations it inherited from other federal agencies.[Footnote 112] As 
a result of the comments received, CFPB has identified several 
priority areas for regulatory action.[Footnote 113] 

Only CFTC and SEC voluntarily developed retrospective review plans in 
response to the executive order. In a June 2011 request for 
information, CFTC outlined a two-phase plan to conduct periodic, 
retrospective reviews of its existing regulations.[Footnote 114] Under 
the first phase, CFTC has examined and revised a number of its 
existing regulations as part of its implementation of the Dodd-Frank 
Act. Under the second phase, CFTC plans to conduct retrospective 
reviews of the remainder of its regulations after substantial 
completion of its Dodd-Frank rulemakings. CFTC has provided OMB with 
periodic status reports on its retrospective review plan and reported 
in July 2013 that it still is in phase one. In a September 2011 
request for information, SEC requested public comments to assist it in 
developing a retrospective review plan as part of its ongoing efforts 
to update its regulations and in light of E.O. 13,579.[Footnote 115] 
At the same time, SEC noted that it has formal and informal processes 
for reviewing existing rules to assess their continued utility and 
effectiveness.[Footnote 116] According to SEC staff, they have 
reviewed public comments received in response to the release and 
worked on a draft plan, but the agency has not yet approved or issued 
a final plan. 

In July 2011, OMB issued guidance on E.O. 13,579 and noted that each 
agency should exercise its discretion to develop a retrospective 
review plan tailored to its specific mission, resources, 
organizational structure, and rulemaking history and volume.[Footnote 
117] According to the guidance, each agency should set its own 
priorities, but its retrospective review plans might address the 
following five topics. As federal financial regulators vary in the 
development and implementation of their retrospective review plans, 
they also vary in the extent to which they address or plan to address 
the topics outlined in OMB's guidance. 

* Public participation. Per OMB's guidance, agencies should solicit 
the views of the public on how best to promote retrospective analysis 
of rules. Even before plans are written, for example, the public might 
be asked to provide comments on how such plans might be devised and to 
help identify those rules that might be modified, streamlined, 
expanded, or repealed. Regulators generally have sought public input 
or plan to seek public input about their retrospective review plans. 
In their Federal Register releases, CFTC and SEC requested public 
comments on various aspects of their plans. Under the EGRPRA review, 
the prudential regulators are required under EGRPRA to categorize 
regulations by type and seek public comment on them. According to FDIC 
staff, prudential regulators currently are discussing how best to 
obtain public input for the EGRPRA process. Each year, NCUA invites 
the public to comment on the rules proposed for review that year. 
Also, CFPB is required to solicit public comment to inform its 
statutorily required retrospective reviews. 

* Prioritization. Per OMB's guidance, the plan should specify factors 
that the agency will consider and the process that the agency will use 
in setting priorities and selecting rules for review. To the extent 
feasible, the plan should also include an initial list of candidate 
rules for review over the next two years, with clear timelines and 
deadlines. Regulators generally have not specified the factors that 
they will use to prioritize and select rules for review but have 
indicated that they plan to do so. CFTC and SEC asked for public 
comments on the factors they should use to prioritize and select rules 
for review. In its plan, CFTC noted that its Regulatory Review Group, 
consisting of senior staff, will recommend to the CFTC Commission a 
list of candidate rules for review, in part based on public comments. 
Under the EGRPRA review, the prudential regulators are required to 
categorize regulations by type and seek public comment on them to 
identify regulatory areas that are outdated, unnecessary, or unduly 
burdensome. According to FDIC staff, prudential regulators are 
developing a plan to efficiently and effectively complete the EGRPRA 
review process. Lastly, CFPB's review under the Dodd-Frank Act must 
cover all of its significant rules, and NCUA's review covers one-third 
of the agency's rules annually. 

* Analysis of costs and benefits. Per OMB's guidance, agencies may 
find it useful to engage in a retrospective analysis of the costs and 
benefits (both quantitative and qualitative) of regulations chosen for 
review. The guidance suggests that the plan may address the metrics 
that the agency will use to evaluate regulations after they have been 
implemented, and the steps the agency has taken to ensure that it has 
high-quality data and robust models with which to conduct 
retrospective analyses. Regulators generally have not yet specified 
the metrics they will use to evaluate regulations or steps to be taken 
to ensure that they have high-quality data with which to conduct their 
retrospective analysis. SEC asked for public comments on, among other 
things, how it can obtain and consider data and analyses to assess the 
benefits of its rules. Likewise, CFPB officials told us that they are 
exploring what data they may collect to analyze their rules. 

* Structure and staffing. Per OMB's guidance, responsibility for 
retrospective review should be vested with a high-level agency 
official who can secure cooperation across the agency. The plan should 
also consider how best to maintain sufficient independence from the 
offices responsible for writing and implementing regulations. Finally, 
the plan should identify possible actions to strengthen internal 
review expertise, if necessary. Regulators generally expect their 
office of general counsel or other nonrulemaking group to be 
responsible for overseeing implementation of their plans. For example, 
SEC has indicated that its Division of Economic and Risk Analysis will 
conduct the retrospective evaluations, and CFTC plans to form a group 
of senior staff that will implement its retrospective review plan. 
CFPB officials told us that the agency's research group likely will 
oversee the reviews. NCUA's Office of General Counsel conducts the 
agency's retrospective reviews. 

* Coordination with other forms of retrospective analysis and review. 
Per OMB's guidance, many independent agencies already are engaged in 
retrospective analysis and review under existing requirements and 
authorities. The guidance states that it is appropriate to use 
existing processes and information as significant inputs into plans. 
As discussed, prudential regulators are using their existing 
retrospective reviews in lieu of developing specific retrospective 
review plans in response to E.O. 13,579. 

Revisiting their retrospective analyses of their Dodd-Frank 
regulations after the regulations are implemented will allow 
regulators to determine whether regulations are achieving their 
intended purpose without creating unintended consequences that 
negatively impact the markets. Such reviews can also signal whether 
changes should be made to the existing rules to better achieve their 
intended purposes. In our prior work, we identified procedures and 
practices that could be particularly helpful in improving the 
effectiveness of retrospective reviews.[Footnote 118] In particular, 
we noted that agencies would be better prepared to undertake reviews 
if they had identified the needed data before beginning a review and, 
even better, before promulgating the rule. If agencies fail to plan 
for how they will measure the performance of their rules and how they 
will obtain the data they need to do so, they may be limited in their 
ability to accurately measure the progress or true effect of the 
regulations. In that regard, we recommended in our prior report that 
the federal financial regulators develop plans that determine how they 
will measure the impact of Dodd-Frank regulations--for example, 
determining how and when to collect, analyze, and report needed data. 
[Footnote 119] To date, regulators have not implemented our 
recommendation. We maintain that doing so would position them to make 
their future retrospective reviews as robust as possible. 

Conclusions: 

Federal financial regulators have considerable work under way to 
implement the Dodd-Frank Act reforms that could improve the U.S. 
financial system in many ways. However, much work remains to implement 
the reforms. For example, many rulemakings are yet to be finalized. 
Moreover, completing the rulemaking process does not mean that reforms 
are fully implemented. Rather, it will take time--beyond the time 
spent on finalizing the rulemakings--for regulators and industry to 
adopt the reforms contained in the rulemakings, and even longer to 
determine the actual effect of the reforms. 

To date, OMB, in consultation with federal agencies, has classified 36 
of the Dodd-Frank rules as major under CRA and, thus, expects them to 
have a large effect on the economy. As provided by CRA, these rules 
could not take effect until the later of 60 days after Congress 
receives the rule report, or 60 days after the rule is published in 
the Federal Register, as long as Congress does not pass a joint 
resolution of disapproval. OMB provided guidance on implementing CRA 
in 1999, but such guidance does not establish standardized processes 
for submitting rules to OMB for its review or applying CRA's criteria. 
In the absence of such guidance, we found that federal financial 
regulators may have used different processes for submitting their 
rules and analyses to OMB, and for applying CRA criteria. These 
inconsistent processes could lead to the inconsistent classification 
of some rules. To the extent that any major rules are not being 
classified as such, those rules would not be subject to the 60-day 
congressional notice required under CRA before major rules become 
effective. 

Recommendations for Executive Action: 

To help ensure that OMB, in consultation with federal financial 
regulators, consistently classifies Dodd-Frank rules as major under 
CRA, we recommend that the Director of OMB, through the Administrator 
of the Office of Information and Regulatory Affairs, issue additional 
guidance to help standardize processes for identifying major rules 
under CRA, including on (1) the extent to which agencies should submit 
rules to OMB for review, such as whether agencies should submit only 
those rules their analyses indicate are major or all rules, and (2) 
how agencies should apply CRA's major rule criteria in their analyses, 
such as whether agencies should include indirect benefits or costs, 
combine benefits or costs of separate but related rules, or aggregate 
benefits or costs for jointly issued rules. 

Agency Comments and Our Evaluation: 

We provided a draft of this report to CFPB, CFTC, FDIC, the Federal 
Reserve Board, FSOC, NCUA, OMB, OCC, SEC, and Treasury for review and 
comment. CFPB, CFTC, FDIC, the Federal Reserve Board, FSOC, OMB, OCC, 
SEC, and Treasury provided technical comments, which we have 
incorporated, as appropriate. Treasury (on behalf of FSOC) and NCUA 
provided written comments that we have reprinted in appendixes IX and 
X, respectively. In its comment letter, Treasury noted that FSOC has 
taken a variety of actions to facilitate coordination and consultation 
among financial regulators, such as through its deputies and 
functional committees, and continually seeks ways to further enhance 
collaboration. We describe these actions in the draft report. In its 
letter, NCUA agreed with our findings, conclusions, and recommendation. 

OMB staff provided comments on a draft of our report via e-mail 
through their GAO liaison on November 25, 2013. In those comments, OMB 
disagreed with our findings and recommendation concerning OMB's 
application of the major rule criteria under CRA. Specifically, OMB 
disagreed with our findings that OMB inconsistently applied CRA 
criteria in its designation of major rules and stated that the 
examples in our draft report are not actual inconsistencies in the 
application of the CRA criteria. In addition, OMB noted that two of 
our examples reflected a challenge faced by OMB in determining whether 
a rule is major. Specifically, agencies often do not have the data 
needed to conduct a precise analysis of a rule's economic impact but, 
nevertheless, will recommend that a rule be designated as major if 
their analysis strongly suggests that the rule may be major. OMB said 
that in these circumstances, it generally will rely on an agency's 
expert judgment and concur with its recommendation. Furthermore, OMB 
said that even if some rule determinations under CRA were 
inconsistent, such outcomes may not result in any real-world 
consequence. For example, a rule incorrectly determined to be non-
major under CRA could have an effective date less than 60 days after 
the rule's submission to Congress, but only if the agency did not plan 
to set the rule's effective date 60 or more days after the rule's 
submission. Finally, given these concerns, OMB questioned what new 
guidance to agencies would entail. Therefore, OMB suggested 
eliminating the recommendation from the draft report. 

We maintain that the findings and recommendation on the major rule 
designation process are appropriate. First, we did not seek to 
determine whether any of the individual rules we reviewed were 
misclassified under CRA. Instead, our analysis identified examples in 
which federal agencies used different processes (1) for submitting 
their rules and supporting analyses to OMB and (2) in applying the CRA 
major rule criteria, which we concluded could lead to inconsistent 
classifications of similar rules under CRA. Indeed, determining 
whether any of the rules we reviewed actually were misclassified is 
not possible without clear guidance on whether agencies, for example, 
may consider a rule's indirect consequences, combine similar rules, or 
add a rule's benefits and costs in developing their designation 
recommendation. Our recommendation serves to address this gap in 
guidance and help ensure more standardized processes. We clarified a 
heading in the draft report to reflect our focus on the processes used 
by OMB and federal financial regulators. 

Second, we agree that federal financial regulators face challenges in 
quantifying the benefits and costs of their rules and have highlighted 
such challenges in our prior reports.[Footnote 120] However, again, 
our findings and recommendation focus on inconsistencies in the 
processes used by OMB and federal financial regulators to designate 
major rules under CRA--not on the analyses conducted by the regulators. 

Third, CRA gives Congress 60 days to review a major rule before the 
rule can become effective, during which time Congress can issue a 
joint resolution disapproving the rule. While OMB notes that there 
might not be a real-world consequence if a rule is misclassified as 
non-major, this outcome relies on the issuing agency setting an 
effective date for the rule of at least 60 days after a rule's 
submission to Congress. Moreover, such a misclassification could 
infringe upon Congress's ability to reject the rule. Additionally, 
under CRA, GAO is required to provide Congress with a report on each 
major rule that contains GAO's assessment of each issuing agency's 
compliance with the procedural steps required by various acts and 
executive orders, including preparation of a cost-benefit analysis. In 
its mandated annual reports to Congress discussing the benefits and 
costs of federal regulations, OMB has stated that it uses GAO major 
rule reports as the sole source of information for analyzing major 
rules issued by independent regulatory agencies.[Footnote 121] A 
misclassification of a major rule as non-major would mean that 
information on that rule would not be highlighted to Congress and the 
public in a GAO report and would, in turn, not be considered in OMB's 
annual reports to Congress on the benefits and costs of federal 
regulations. 

Finally, although OMB issued guidance to federal agencies in 1999 on 
implementing CRA, the guidance did not clearly articulate the 
processes agencies should use to (1) submit their rules and analysis 
to OMB or (2) apply the CRA major rule criteria. In the absence of 
such guidance, we found that federal financial regulators varied in 
the processes they used to submit rules and analysis to OMB and their 
application of CRA criteria. For example, as we discuss in the report, 
SEC and CFPB staff told us that they did not know whether they were 
permitted to add costs and benefits or combine rules, respectively, in 
assessing whether a rule was major. In that regard, we maintain that 
additional guidance on the processes we identified would enhance the 
ability of OMB and federal financial regulators to fulfill their 
responsibilities under CRA. 

We are sending copies of this report to CFPB, CFTC, FDIC, the Federal 
Reserve Board, FSOC, NCUA, OMB, OCC, SEC, Treasury, interested 
congressional committees and members, and others. This report will 
also be available at no charge on our website at [hyperlink, 
http://www.gao.gov]. 

Should you or your staff have questions concerning this report, please 
contact me at (202) 512-8678 or clowersa@gao.gov. Contact points for 
our Offices of Congressional Relations and Public Affairs may be found 
on the last page of this report. Key contributors to this report are 
listed in appendix XI. 

Signed by: 

A. Nicole Clowers: 
Director: 
Financial Markets and Community Investment: 

List of Addressees: 

The Honorable Harry Reid: 
Majority Leader: 
The Honorable Mitch McConnell: 
Minority Leader: 
United States Senate: 

The Honorable John Boehner: 
Speaker: 
The Honorable Nancy Pelosi: 
Minority Leader: 
House of Representatives: 

The Honorable Debbie Stabenow: 
Chairwoman: 
The Honorable Thad Cochran: 
Ranking Member: 
Committee on Agriculture, Nutrition and Forestry: 
United States Senate: 

The Honorable Barbara A. Mikulski: 
Chairwoman: 
The Honorable Richard Shelby: 
Vice Chairman: 
Committee on Appropriations: 
United States Senate: 

The Honorable Tim Johnson: 
Chairman: 
The Honorable Michael Crapo: 
Ranking Member: 
Committee on Banking, Housing, and Urban Affairs: 
United States Senate: 

The Honorable John D. Rockefeller IV: 
Chairman: 
The Honorable John Thune: 
Ranking Member: 
Committee on Commerce, Science, and Transportation: 
United States Senate: 

The Honorable Frank D. Lucas: 
Chairman: 
The Honorable Collin C. Peterson: 
Ranking Member: 
Committee on Agriculture: 
House of Representatives: 

The Honorable Harold Rogers: 
Chairman: 
The Honorable Nita Lowey: 
Ranking Member: 
Committee on Appropriations: 
House of Representatives: 

The Honorable Fred Upton: 
Chairman: 
The Honorable Henry A. Waxman: 
Ranking Member: 
Committee on Energy and Commerce: 
House of Representatives: 

The Honorable Jeb Hensarling: 
Chairman: 
The Honorable Maxine Waters: 
Ranking Member: 
Committee on Financial Services: 
House of Representatives: 

[End of section] 

Appendix I: Objectives, Scope, and Methodology: 

This report examines rulemaking under the Dodd-Frank Wall Street 
Reform and Consumer Protection Act of 2010 (Dodd-Frank Act). More 
specifically, we examined (1) the regulatory analysis conducted by 
federal agencies in their Dodd-Frank rulemakings, including their 
assessments of which rules they considered to be major rules under the 
Congressional Review Act (CRA); (2) interagency coordination by the 
agencies in their Dodd-Frank rulemakings and by the Consumer Financial 
Protection Bureau (CFPB) with other agencies in connection to its 
supervision of large banks and certain nonbank financial service 
providers; and (3) possible impact of selected Dodd-Frank provisions 
and their implementing regulations and agency plans to assess such 
regulations retrospectively.[Footnote 122] 

To examine the regulatory analyses and coordination conducted by the 
regulators, we focused our analysis on final rules issued pursuant to 
the Dodd-Frank Act that became effective from July 24, 2012, through 
July 22, 2013, a total of 70 rules (see appendix II). To identify 
these rules, we used a website maintained by the Federal Reserve Bank 
of St. Louis that tracks Dodd-Frank regulations.[Footnote 123] We 
corroborated the data with officials from the agencies under review. 

In examining the regulatory analyses of the federal agencies in our 
review, we reviewed federal statutes, regulations, GAO studies, and 
other material to identify the regulatory analyses, including benefit-
cost analysis, required to be conducted by the federal agencies as 
part of their Dodd-Frank rulemakings. Of the 70 rules within our 
scope, 59 rules were substantive regulations--generally subject to 
public notice and comment under the Administrative Procedure Act--and 
required the agencies to conduct some form of regulatory analysis. 
[Footnote 124] For each of the 59 rules, we reviewed final rule 
Federal Register releases to document and summarize the analyses 
conducted by the regulators under review. Using GAO's Federal Rules 
database we found that 10 of the 59 rules were classified by the 
Office of Management and Budget (OMB), in consultation with the 
rulemaking agencies, as major rules under CRA (that is, have resulted 
in or are likely to result in an annual impact on the economy of $100 
million or more, a major increase in costs or prices, or significant 
adverse effects on competition, employment, investment, productivity, 
innovation, or on the ability of U.S.-based enterprises to compete 
with foreign-based enterprises in domestic and export markets). For 
agencies subject to Executive Order 12,866 (E.O. 12,866), such major 
rules would be considered significant regulatory actions and subject 
to formal benefit-cost analysis.[Footnote 125] We developed a data 
collection instrument to compare and assess the regulatory analysis 
conducted for the 10 major rules against the principles outlined in 
OMB Circular A-4, which provides guidance to federal agencies on the 
development of regulatory analysis.[Footnote 126] To conduct our 
analyses, we reviewed Federal Register releases of the proposed and 
final rules. To examine how OMB, in consultation with federal 
agencies, classifies rules as major, we reviewed CRA, GAO reports, and 
other material. Rather than limiting our scope to major rules 
effective from July 24, 2012, through July 22, 2013, we reviewed and 
analyzed all final Dodd-Frank rules classified as major as of July 22, 
2013. To identify such major rules, we relied on GAO's Federal Rules 
database.[Footnote 127] We identified 36 major rules issued pursuant 
to the Dodd-Frank Act (which includes the 10 major rules mentioned 
above) and corroborated our list with federal agencies under review. 
To examine the basis for classifying the rules as major, we reviewed 
the impact analyses prepared by the agencies and provided to OMB, if 
available; GAO reports on major rules; and Federal Register releases 
on the rules. We also interviewed officials from OMB and federal 
agencies about the processes used to classify major rules. 

To examine interagency coordination among the regulators, we reviewed 
the Dodd-Frank Act, Federal Register releases, and GAO reports to 
identify the interagency coordination or consultation requirements for 
the 70 Dodd-Frank rules within our scope. We also interviewed 
officials or staff from the Commodity Futures Trading Commission 
(CFTC), CFPB, and the Securities and Exchange Commission (SEC) to 
identify which rules were subject to interagency coordination 
requirements under Titles VII and X of the act. We found evidence of 
coordination between the rulemaking agency and other regulators for 49 
of the 70 regulations that we reviewed. We reviewed the Federal 
Register releases of the proposed and final rules and interviewed 
agency officials to document whether the agencies coordinated or 
consulted with other U.S., foreign, or international regulators, as 
required by the Dodd-Frank Act or on a voluntary basis. To examine 
steps taken by CFPB to comply with the act's interagency coordination 
and information-sharing requirements for its supervision activities, 
we reviewed the act; CFPB's Supervision and Examination Manual, 
memorandums of understanding with federal and state regulators on 
interagency coordination, and other agency documents; and GAO reports. 
We also interviewed officials from CFPB and federal prudential 
regulators about their coordination with each other and coordination 
challenges. 

Finally, we took a multipronged approach to analyze what is known 
about the impact of the Dodd-Frank Act on the financial marketplace. 
First, we used bank holding company data from the Federal Reserve Bank 
of Chicago (from FR Y-9C), Bureau of Economic Analysis, and Federal 
Reserve Board's National Information Center, to update our indicators 
monitoring changes in certain characteristics of systemically 
important financial institutions (SIFI) that might be affected by Dodd-
Frank regulations.[Footnote 128] Although changes in the indicators 
may be suggestive of the impact of the act on SIFIs, the indicators 
have a number of limitations, including that they do not identify any 
causal linkages between the act and changes in the indicators. 
Moreover, factors other than the act affect SIFIs and, thus, the 
indicators. Second, we used the Federal Reserve Bank of Chicago data 
to update our economic analysis estimating changes in the (1) cost of 
credit provided by bank SIFIs and (2) safety and soundness of bank 
SIFIs. Our analysis does not differentiate the effects of the act from 
simultaneous changes in economic conditions or other factors that may 
affect such companies. Third, the Dodd-Frank Act requires CFTC, SEC, 
and the prudential regulators to implement new reforms for swaps and 
security-based swaps to reduce risk, increase transparency, and 
improve market integrity. For example, the act provides for the 
registration of swap dealers, including subjecting them to minimum 
margin requirements, and authorizes CFTC and SEC to impose mandatory 
clearing requirements on swaps. We developed margin and clearing 
indicators that may reflect the act's impact on these activities using 
bank holding company data from the Federal Reserve Bank of Chicago 
(from FR Y-9C) and CFTC's Swaps Report, respectively. As new data 
become available, we expect to update and, as warranted, revise our 
indicators and create additional indicators to cover other provisions. 
Although changes in our indicators may be suggestive of the act's 
impact on the swaps market, the indicators have a number of 
limitations, including that they do not identify causal linkages 
between the act and changes in the indicators. Fourth, to assess 
agency plans to conduct retrospective reviews of their existing rules, 
we reviewed executive orders, including E.O. 13,579 that asks 
independent regulatory agencies to prepare retrospective review plans; 
OMB guidance; Federal Register releases, policies, and other agency 
documents pertaining to retrospective reviews; and GAO reports. 
Finally, we interviewed federal financial regulators about their plans 
to conduct retrospective reviews of their Dodd-Frank rules. For parts 
of our methodology that involved the analysis of computer-processed 
data, we assessed the reliability of these data and determined that 
they were sufficiently reliable for our purposes. 

We conducted this performance audit from January 2013 to December 2013 
in accordance with generally accepted government auditing standards. 
Those standards require that we plan and perform the audit to obtain 
sufficient, appropriate evidence to provide a reasonable basis for our 
findings and conclusions based on our audit objectives. We believe 
that the evidence obtained provides a reasonable basis for our 
findings and conclusions based on our audit objectives. 

[End of section] 

Appendix II: Dodd-Frank Rules Effective as of July 22, 2013: 

The following table lists the Dodd-Frank rules that we identified as 
effective during the scope period for this review--July 24, 2012, 
through July 22, 2013. 

Table 4: Dodd-Frank Rules Effective from July 24, 2012, through July 
22, 2013: 

Rulemaking: Electronic Fund Transfers (Regulation E); 
Responsible 
regulator: CFPB; 
Published date: 2/7/2012; 
Effective date[A]: 2/7/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Customer Clearing Documentation, Timing of Acceptance for 
Clearing, and Clearing Member Risk Management; 
Responsible regulator: CFTC; 
Published date: 4/9/2012; 
Effective date[A]: 10/1/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Guidance on Effective Date of Section 716 of the Dodd-Frank 
Wall Street Reform and Consumer Protection Act; 
Responsible regulator: FDIC, FRS, and OCC; 
Published date: 5/10/2012; 
Effective date[A]: 7/16/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: N/A; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: N/A. 

Rulemaking: Swap Data Recordkeeping and Reporting Requirements: Pre-
Enactment and Transition Swaps; 
Responsible regulator: CFTC; 
Published date: 6/12/2012; 
Effective date[A]: 8/13/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Guidance on Due Diligence Requirements in Determining 
Whether Securities Are Eligible for Investment; 
Responsible regulator: OCC; 
Published date: 6/13/2012; 
Effective date[A]: 1/1/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: N/A; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: N/A. 

Rulemaking: Core Principles and Other Requirements for Designated 
Contract Markets; 
Responsible regulator: CFTC; 
Published date: 6/19/2012; 
Effective date[A]: 8/20/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Listing Standards for Compensation Committees; 
Responsible regulator: SEC; 
Published date: 6/27/2012; 
Effective date[A]: 7/27/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Confidential Treatment of Privileged Information; 
Responsible regulator: CFPB; 
Published date: 7/5/2012; 
Effective date[A]: 8/6/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: Yes. 

Rulemaking: Process for Submissions for Review of Security-Based Swaps 
for Mandatory Clearing and Notice Filing Requirements for Clearing 
Agencies; 
Technical Amendments to Rule 19b-4 and Form 19b-4 Applicable 
to All Self-Regulatory Organizations; 
Responsible regulator: SEC; 
Published date: 7/13/2012; 
Effective date[A]: 8/13/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: End-User Exception to the Clearing Requirement for Swaps; 
Responsible regulator: CFTC; 
Published date: 7/19/2012; 
Effective date[A]: 9/17/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Defining Larger Participants of the Consumer Reporting 
Market; 
Responsible regulator: CFPB; 
Published date: 7/20/2012; 
Effective date[A]: 9/30/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: Yes. 

Rulemaking: Swap Transaction Compliance and Implementation Schedule: 
Clearing Requirement Under Section 2(h) of the CEA; 
Responsible regulator: CFTC; 
Published date: 7/30/2012; 
Effective date[A]: 9/28/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Financial Market Utilities; 
Responsible regulator: FRS; 
Published date: 8/2/2012; 
Effective date[A]: 9/14/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: N/A. 

Rulemaking: Debit Card Interchange Fees and Routing; 
Responsible regulator: FRS; 
Published date: 8/3/2012; 
Effective date[A]: 10/1/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: N/A. 

Rulemaking: Further Definition of "Swap," "Security-Based Swap," 
and "Security-Based Swap Agreement"; Mixed Swaps; Security-Based Swap 
Agreement Recordkeeping; 
Responsible regulator: CFTC and SEC; 
Published date: 8/13/2012; 
Effective date[A]: 10/12/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Electronic Fund Transfers (Regulation E); 
Responsible regulator: CFPB; 
Published date: 8/20/2012; 
Effective date[A]: 2/7/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Registration of Intermediaries; 
Responsible regulator: CFTC; 
Published date: 8/28/2012; 
Effective date[A]: 10/29/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Risk-Based Capital Guidelines: Market Risk; 
Responsible regulator: FDIC, FRS, and OCC; 
Published date: 8/30/2012; 
Effective date[A]: 1/1/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: N/A. 

Rulemaking: Amendments to Commodity Pool Operator and Commodity Trading 
Advisor Regulations Resulting From the Dodd-Frank Act; 
Responsible regulator: CFTC; 
Published date: 9/5/2012; 
Effective date[A]: 11/5/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Confirmation, Portfolio Reconciliation, Portfolio 
Compression, and Swap Trading Relationship Documentation Requirements 
for Swap Dealers and Major Swap Participants; 
Responsible regulator: CFTC; 
Published date: 9/11/2012; 
Effective date[A]: 11/13/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Conflict Minerals; 
Responsible regulator: SEC; 
Published date: 9/12/2012; 
Effective date[A]: 11/13/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Disclosure of Payments by Resource Extraction Issuersc; 
Responsible regulator: SEC; 
Published date: 9/12/2012; 
Effective date[A]: 11/13/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Annual Stress Test; 
Responsible regulator: OCC; 
Published date: 10/9/2012; 
Effective date[A]: 10/9/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: N/A. 

Rulemaking: Supervisory and Company-Run Stress Test Requirements for 
Covered Companies; 
Responsible regulator: FRS; 
Published date: 10/12/2012; 
Effective date[A]: 11/15/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: N/A. 

Rulemaking: Annual Company-Run Stress Test Requirements for Banking 
Organizations With Total Consolidated Assets Over $10 Billion Other 
Than Covered Companies; 
Responsible regulator: FRS; 
Published date: 10/12/2012; 
Effective date[A]: 11/15/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: N/A. 

Rulemaking: Annual Stress Test; 
Responsible regulator: FDIC; 
Published date: 10/15/2012; 
Effective date[A]: 10/15/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: N/A. 

Rulemaking: Enforcement of Subsidiary and Affiliate Contracts by the 
FDIC as Receiver of a Covered Financial Company; 
Responsible regulator: FDIC; 
Published date: 10/16/2012; 
Effective date[A]: 11/15/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: N/A. 

Rulemaking: Swap Data Repositories: Interpretative Statement Regarding 
the Confidentiality and Indemnification Provisions of the Commodity 
Exchange Act; 
Responsible regulator: CFTC; 
Published date: 10/25/2012; 
Effective date[A]: 10/25/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: N/A; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: N/A. 

Rulemaking: Assessments, Large Bank Pricing; 
Responsible regulator: FDIC; 
Published date: 10/31/2012; 
Effective date[A]: 4/1/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: N/A. 

Rulemaking: Defining Larger Participants of the Consumer Debt 
Collection Market; 
Responsible regulator: CFPB; 
Published date: 10/31/2012; 
Effective date[A]: 1/2/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: Yes. 

Rulemaking: Clearing Agency Standards; 
Responsible regulator: SEC; 
Published date: 11/2/2012; 
Effective date[A]: 1/2/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Adaptation of Regulations To Incorporate Swaps; 
Responsible regulator: CFTC; 
Published date: 11/2/2012; 
Effective date[A]: 1/2/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Determination of Foreign Exchange Swaps and Foreign 
Exchange Forwards Under the Commodity Exchange Act; 
Responsible regulator: Treasury; 
Published date: 11/20/2012; 
Effective date[A]: 11/20/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: Yes. 

Rulemaking: Truth in Lending (Regulation Z); 
Responsible regulator: CFPB and FRS; 
Published date: 11/21/2012; 
Effective date[A]: 1/1/2013;
Agency conducted analysis required under: 
Regulatory Flexibility Act: N/A; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: N/A. 

Rulemaking: Consumer Leasing (Regulation M); 
Responsible regulator: CFPB and FRS; 
Published date: 11/21/2012; 
Effective date[A]: 1/1/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: N/A; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: N/A. 

Rulemaking: Truth in Lending (Regulation Z); 
Responsible regulator: CFPB; 
Published date: 11/21/2012; 
Effective date[A]: 1/1/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: N/A; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: N/A. 

Rulemaking: Purchase of Certain Debt Securities by Business and 
Industrial Development Companies Relying on an Investment Company Act 
Exemption; 
Responsible regulator: SEC; 
Published date: 11/23/2012; 
Effective date[A]: 12/24/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Delayed Implementation of Certain New Mortgage Disclosures; 
Responsible regulator: CFPB; 
Published date: 11/23/2012; 
Effective date[A]: 11/23/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: Yes. 

Rulemaking: Alternatives to the Use of Credit Ratings; 
Responsible 
regulator: NCUA; 
Published date: 12/13/2012; 
Effective date[A]: 6/11/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Clearing Requirement Determination Under Section 2(h) of 
the CEA; 
Responsible regulator: CFTC; 
Published date: 12/13/2012; 
Effective date[A]: 2/11/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Community Reinvestment Act Regulations; 
Responsible regulator: FDIC, FRS, and OCC; 
Published date: 12/21/2012; 
Effective date[A]: 1/1/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: N/A; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: N/A. 

Rulemaking: Adaptation of Regulations To Incorporate Swaps--Records of 
Transactions; 
Responsible regulator: CFTC; 
Published date: 12/21/2012; 
Effective date[A]: 2/19/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Lending Limits; 
Responsible regulator: OCC; 
Published date: 12/31/2012; 
Effective date[A]: 12/31/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: N/A; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: N/A. 

Rulemaking: Final Exemptive Order Regarding Compliance with Certain 
Swap Regulations; 
Responsible regulator: CFTC; 
Published date: 1/7/2013; 
Effective date[A]: 12/21/2012; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: N/A; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Transition Period Under Section 716 of the Dodd-Frank Wall 
Street Reform and Consumer Protection Act; 
Responsible regulator: OCC; 
Published date: 1/8/2013; 
Effective date[A]: 1/8/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: N/A; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: N/A. 

Rulemaking: Treasury Tax and Loan Depositaries; 
Depositaries and Financial Agents of the Government; 
Responsible regulator: NCUA; 
Published date: 1/18/2013; 
Effective date[A]: 1/18/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Escrow Requirements Under the Truth in Lending Act 
(Regulation Z); 
Responsible regulator: CFPB; 
Published date: 1/22/2013; 
Effective date[A]: 6/1/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: Yes. 

Rulemaking: Lost Securityholders and Unresponsive Payees; 
Responsible regulator: SEC; 
Published date: 1/23/2013; 
Effective date[A]: 3/25/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Loan Originator Compensation Requirements Under the Truth 
in Lending Act (Regulation Z); 
Responsible regulator: CFPB; 
Published date: 2/15/2013; 
Effective date[A]: 6/1/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Disclosure of Records and Information; 
Responsible regulator: CFPB; 
Published date: 2/15/2013; 
Effective date[A]: 3/18/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: Yes. 

Rulemaking: Disclosures at Automated Teller Machines (Regulation E); 
Responsible regulator: CFPB; 
Published date: 3/26/2013; 
Effective date[A]: 3/26/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: N/A; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: Yes. 

Rulemaking: Truth in Lending (Regulation Z); 
Responsible regulator: CFPB; 
Published date: 3/28/2013; 
Effective date[A]: 3/28/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: N/A; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: Yes. 

Rulemaking: Final Order in Response to a Petition From Certain 
Independent System Operators and Regional Transmission Organizations To 
Exempt Specified Transactions Authorized by a Tariff or Protocol 
Approved by the Federal Energy Regulatory Commission or the Public 
Utility Commission of Texas From Certain Provisions of the Commodity 
Exchange Act Pursuant to the Authority Provided in the Act; 
Responsible regulator: CFTC; 
Published date: 4/2/2013; 
Effective date[A]: 4/2/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Order Exempting, Pursuant to Authority of the Commodity 
Exchange Act, Certain Transactions Between Entities Described in the 
Federal Power Act, and Other Electric Cooperatives; 
Responsible regulator: CFTC; 
Published date: 4/2/2013; 
Effective date[A]: 4/2/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Definitions of "Predominantly Engaged In Financial 
Activities" and "Significant" Nonbank Financial Company and Bank 
Holding Company; 
Responsible regulator: FRS; 
Published date: 4/5/2013; 
Effective date[A]: 5/6/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: N/A. 

Rulemaking: Dual and Multiple Associations of Persons Associated With 
Swap Dealers, Major Swap Participants and Other Commission Registrants; 
Responsible regulator: CFTC; 
Published date: 4/8/2013; 
Effective date[A]: 6/7/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Retail Foreign Exchange Transactions (Regulation NN); 
Responsible regulator: FRS; 
Published date: 4/9/2013; 
Effective date[A]: 5/13/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: N/A. 

Rulemaking: Disclosure of Consumer Complaint Data; 
Responsible regulator: CFPB; 
Published date: 4/10/2013; 
Effective date[A]: 3/25/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: N/A; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: N/A. 

Rulemaking: Clearing Exemption for Swaps Between Certain Affiliated 
Entities; 
Responsible regulator: CFTC; 
Published date: 4/11/2013; 
Effective date[A]: 6/10/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Identity Theft Red Flags Rules; 
Responsible regulator: CFTC and SEC; 
Published date: 4/19/2013; 
Effective date[A]: 5/20/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Truth in Lending (Regulation Z); 
Responsible regulator: CFPB; 
Published date: 5/3/2013; 
Effective date[A]: 5/3/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: N/A; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: Yes. 

Rulemaking: Consumer Financial Civil Penalty Fund; 
Responsible regulator: CFPB; 
Published date: 5/7/2013; 
Effective date[A]: 5/7/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: N/A; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: Yes. 

Rulemaking: Amendments to the 2013 Escrows Final Rule under the Truth 
in Lending Act (Regulation Z); 
Responsible regulator: CFPB; 
Published date: 5/23/2013; 
Effective date[A]: 6/1/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: Yes. 

Rulemaking: Antidisruptive practices authority; 
Responsible regulator: CFTC; 
Published date: 5/28/2013; 
Effective date[A]: 5/28/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: N/A; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: N/A. 

Rulemaking: Technical Amendments; 
Responsible regulator: NCUA; 
Published date: 5/31/2013; 
Effective date[A]: 5/31/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: N/A. 

Rulemaking: Loan Originator Compensation Requirements Under the Truth 
in Lending Act (Regulation Z); Prohibition on Financing Credit 
Insurance Premiums; Delay of Effective Date; 
Responsible regulator: CFPB; 
Published date: 5/31/2013; 
Effective date[A]: 6/1/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: N/A; 
Executive Order or statute[B]: Yes. 

Rulemaking: Definition of "Predominantly Engaged in Activities That 
Are Financial in Nature or Incidental Thereto"; 
Responsible regulator: FDIC; 
Published date: 6/10/2013; 
Effective date[A]: 7/10/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: N/A. 

Rulemaking: Lending Limits; 
Responsible regulator: OCC; 
Published date: 6/25/2013; 
Effective date[A]: 6/25/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: N/A. 

Rulemaking: Retail Foreign Exchange Transactions; 
Responsible regulator: SEC; 
Published date: 7/16/2013; 
Effective date[A]: 7/16/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: Yes; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Rulemaking: Rescission of Supervised Investment Bank Holding Company 
Rules; 
Responsible regulator: SEC; 
Published date: 7/18/2013; 
Effective date[A]: 7/18/2013; 
Agency conducted analysis required under: 
Regulatory Flexibility Act: N/A; 
Paperwork Reduction Act: Yes; 
Executive Order or statute[B]: Yes. 

Source: Dodd-Frank Act, Federal Register, and other documents from 
regulators. 

[A] To determine our scope for this review, we considered the earliest 
effective date shown in the final Federal Register releases for each 
Dodd-Frank rulemaking. If the effective date shown fell within our 
scope, the rule was included even if subsequent rulemakings changed 
the effective date of the rule. 

[B] Executive Order 12,866 requires executive agencies, like the 
Department of the Treasury, to the extent permitted by law and where 
applicable, to (1) assess benefits and costs of available regulatory 
alternatives and (2) include both quantifiable and qualitative 
measures of benefits and costs in their analysis. Additionally, CFTC, 
CFPB, and SEC each have requirements for conducting economic analyses 
of their rules under their own organic statutes. First, CFTC, under 
section 15(a) of the Commodity Exchange Act, is required to consider 
the benefits and costs of its action before promulgating a regulation 
under the Commodity Exchange Act or issuing certain orders. Second, 
CFPB, under the Consumer Financial Protection Act (Title X of the Dodd-
Frank Act), must consider the potential benefits and costs of its 
rules for consumers and entities that offer or provide consumer 
financial products and services. Third, under the Securities Act, the 
Securities Exchange Act, the Investment Advisers Act, and the 
Investment Company Act, SEC must consider whether a rule will promote 
efficiency, competition, and capital formation whenever it is engaged 
in rulemaking and is required to consider or determine whether an 
action is necessary or appropriate in the public interest. Under the 
Securities Exchange Act, SEC also must not adopt a rule that would 
impose a burden on competition not necessary or appropriate in 
furtherance of the purposes of the act. 

[C] This rule is no longer in effect because it was vacated by a 
decision of the U.S. District Court for the District of Columbia on 
July 2, 2013. See American Petroleum Institute et al. v. SEC, ---
F.Supp.2d ---, 2013 WL 3307114 (D.D.C. 2013). 

[D] We did not consider a rule "substantive" for purposes of this 
report if the agency (1) stated the rule did not require notice and 
comment; (2) did not conduct analysis of benefits or costs; and (3) 
concluded, per PRA, that the rule did not impose new information 
collection requirements or substantively or materially revise existing 
collections of information. 

Note: In this report, we use the terms "rules," "regulations," or 
"rulemakings" generally to refer to Federal Register notices of agency 
action pursuant to the Dodd-Frank Act, including regulations, 
interpretive rules, general statements of policy, guidance, and rules 
that deal with agency organization, procedure, or practice. Combined 
with our past two reports, we have reviewed all Dodd-Frank Act rules 
in effect as of July 22, 2013. See GAO, Dodd-Frank Act Regulations: 
Implementation Could Benefit from Additional Analyses and 
Coordination, GAO-12-151 (Washington, D.C.: Nov. 10, 2011), and Dodd-
Frank Act Regulations: Agencies' Efforts to Analyze and Coordinate 
Their Rules, GAO-13-101 (Washington, D.C.: Dec. 18, 2012). 

[End of table] 

The following table lists the Dodd-Frank rules that we identified as 
final and effective during the scope period for our November 2012 
review--July 22, 2011, through July 23, 2012. 

Table 5: Dodd-Frank Rules Effective from July 22, 2011, through July 
23, 2012: 

Rulemaking: Risk-Based Capital Standards: Advanced Capital Adequacy 
Framework--Basel II; 
Establishment of a Risk-Based Capital Floor; 

Responsible regulator: FDIC, Federal Reserve, and OCC; 
Effective date: 07/28/11; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No[A]; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Securities Whistleblower Incentives and Protections; 
Responsible regulator: SEC; 
Effective date: 08/12/11; 
Did regulator identify the rule as having significant economic impact? 
Yes; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Prohibition on the Employment, or Attempted Employment, of 
Manipulative and Deceptive Devices and Prohibition on Price 
Manipulation; 
Responsible regulator: CFTC; 
Effective date: 08/15/11; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Fair Credit Reporting Risk-Based Pricing Regulations; 
Responsible regulator: Federal Reserve and Federal Trade Commission; 
Effective date: 08/15/11; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Equal Credit Opportunity; 
Responsible regulator: Federal Reserve; 
Effective date: 08/15/11; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Certain Orderly Liquidation Authority Provisions under 
Title II of the Dodd-Frank Wall Street Reform and Consumer Protection 
Act; 
Responsible regulator: FDIC; 
Effective date: 08/15/11; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? No; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Public Company Accounting Oversight Board; 
Order Approving Proposed Board Funding Final Rules for Allocation of 
the Board's Accounting Support Fee Among Issuers, Brokers, and 
Dealers, and Other Amendments to the Board's Funding Rules; 
Responsible regulator: SEC; 
Effective date: 08/18/11; 
Did regulator identify the rule as having significant economic impact? 
N/A; 
Did regulator quantify costs of final rule other than PRA costs? N/A; 
Did regulator quantify benefits of final rule? N/A; 
Did regulator qualitatively identify costs of final rule? N/A; 
Did regulator qualitatively identify benefits of final rule? N/A. 

Rulemaking: Authority to Designate Financial Market Utilities (FMU) as 
Systemically Important; 
Responsible regulator: FSOC; 
Effective date: 08/26/11; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Family Offices; 
Responsible regulator: SEC; 
Effective date: 08/29/11; 
Did regulator identify the rule as having significant economic impact? 
Yes; 
Did regulator quantify costs of final rule other than PRA costs? Yes; 
Did regulator quantify benefits of final rule? Yes; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Security Ratings; 
Responsible regulator: SEC; 
Effective date: 09/02/11; 12/31/12; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Agricultural Commodity Definition; 
Responsible regulator: CFTC; 
Effective date: 09/12/11; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Retail Foreign Exchange Transactions; Conforming Changes 
to Existing Regulations in Response to the Dodd-Frank Wall Street 
Reform and Consumer Protection Act; 
Responsible regulator: CFTC; 
Effective date: 09/12/11; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Rules Implementing Amendments to the Investment Advisers 
Act of 1940; 
Responsible regulator: SEC; 
Effective date: 07/21/11; 09/19/11; 
Did regulator identify the rule as having significant economic impact? 
Yes; 
Did regulator quantify costs of final rule other than PRA costs? Yes; 
Did regulator quantify benefits of final rule? Yes; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Privacy of Consumer Financial Information; Conforming 
Amendments Under Dodd-Frank Act; 
Responsible regulator: CFTC; 
Effective date: 09/20/11; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Large Trader Reporting for Physical Commodity Swaps; 
Responsible regulator: CFTC; 
Effective date: 09/20/11; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Business Affiliate Marketing and Disposal of Consumer 
Information Rules; 
Responsible regulator: CFTC; 
Effective date: 09/20/11b; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Suspension of the duty to file reports for classes of 
asset-backed securities; 
Responsible regulator: SEC; 
Effective date: 09/22/11; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Removing Any Reference to or Reliance on Credit Ratings in 
Commission Regulations; Proposing Alternatives to the Use of Credit 
Ratings; 
Responsible regulator: CFTC; 
Effective date: 09/23/11; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Process for Review of Swaps for Mandatory Clearing; 
Responsible regulator: CFTC; 
Effective date: 09/26/11; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Provisions Common to Registered Entities; 
Responsible regulator: CFTC; 
Effective date: 09/26/11; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Debit Card Interchange Fees and Routing; 
Responsible regulator: Federal Reserve; 
Effective date: 10/01/11[B]; 
Did regulator identify the rule as having significant economic impact? 
Yes; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; Did regulator 
qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Whistleblower Incentives and Protection; 
Responsible regulator: CFTC; 
Effective date: 10/24/11; 
Did regulator identify the rule as having significant economic impact? 
Yes; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Swap Data Repositories: Registration Standards, Duties and 
Core Principles; 
Responsible regulator: CFTC; 
Effective date: 10/31/11; 
Did regulator identify the rule as having significant economic impact? 
Yes; 
Did regulator quantify costs of final rule other than PRA costs? Yes; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Disclosure of Information; Privacy Act Regulations; Notice 
and Amendments; 
Responsible regulator: FDIC; 
Effective date: 11/14/11; 
Did regulator identify the rule as having significant economic impact? 
N/A; 
Did regulator quantify costs of final rule other than PRA costs? N/A; 
Did regulator quantify benefits of final rule? N/A; 
Did regulator qualitatively identify costs of final rule? N/A; 
Did regulator qualitatively identify benefits of final rule? N/A. 

Rulemaking: Resolution Plans Required; 
Responsible regulator: Federal Reserve and FDIC; 
Effective date: 11/30/11; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Remittance Transfers; 
Responsible regulator: NCUA; 
Effective date: 11/30/11; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? No; 
Did regulator qualitatively identify benefits of final rule? No. 

Rulemaking: Amendment to July 14, 2011 Order for Swap Regulation; 
Responsible regulator: CFTC; 
Effective date: 12/23/11; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? No; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Capital Plans; 
Responsible regulator: Federal Reserve; 
Effective date: 12/30/11; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? No. 

Rulemaking: Agricultural Swaps Rule; 
Responsible regulator: CFTC; 
Effective date: 12/31/11; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Derivatives Clearing Organization General Provisions and 
Core Principles; 
Responsible regulator: CFTC; 
Effective date: 01/09/12; 
Did regulator identify the rule as having significant economic impact? 
Yes; 
Did regulator quantify costs of final rule other than PRA costs? Yes; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Position Limits for Futures and Swaps; 
Responsible regulator: CFTC; 
Effective date: 01/17/12; 
Did regulator identify the rule as having significant economic impact? 
Yes; 
Did regulator quantify costs of final rule other than PRA costs? Yes; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Performance of Registration Functions by National Futures 
Association with Respect to Swap Dealers and Major Swap Participants; 
Responsible regulator: CFTC; 
Effective date: 01/19/12; 
Did regulator identify the rule as having significant economic impact? 
N/A; 
Did regulator quantify costs of final rule other than PRA costs? N/A; 
Did regulator quantify benefits of final rule? N/A; 
Did regulator qualitatively identify costs of final rule? N/A; 
Did regulator qualitatively identify benefits of final rule? N/A. 

Rulemaking: Mine Safety Disclosure; 
Responsible regulator: SEC; 
Effective date: 01/27/12; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Reporting Line for the Commission's Inspector General; 
Responsible regulator: SEC; 
Effective date: 02/14/12; 
Did regulator identify the rule as having significant economic impact? 
N/A; 
Did regulator quantify costs of final rule other than PRA costs? N/A; 
Did regulator quantify benefits of final rule? N/A; 
Did regulator qualitatively identify costs of final rule? N/A; 
Did regulator qualitatively identify benefits of final rule? N/A. 

Rulemaking: Investment of Customer Funds and Funds Held in an Account 
for Foreign Futures and Foreign Options Transactions; 
Responsible regulator: CFTC; 
Effective date: 02/17/12; 
Did regulator identify the rule as having significant economic impact? 
Yes; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Registration of Foreign Boards of Trade; 
Responsible regulator: CFTC; 
Effective date: 02/21/12; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? Yes; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Net Worth Standard for Accredited Investors; 
Responsible regulator: SEC; 
Effective date: 02/27/12; 
Did regulator identify the rule as having significant economic impact? 
Yes; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Real-Time Reporting of Swap Transaction Data; 
Responsible regulator: CFTC; 
Effective date: 03/09/12; 
Did regulator identify the rule as having significant economic impact? 
Yes; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Swap Data Recordkeeping and Reporting Requirements; 
Responsible regulator: CFTC; 
Effective date: 03/13/12; 
Did regulator identify the rule as having significant economic impact? 
Yes; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Registration of Swap Dealers and Major Swap Participants; 
Responsible regulator: CFTC; 
Effective date: 03/19/12; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? Yes; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Reporting by Investment Advisers to Private Funds and 
Certain Commodity Pool Operators and Commodity Trading Advisors on Form 
PF; 
Responsible regulator: SEC and CFTC; 
Effective date: 03/31/12; 
Did regulator identify the rule as having significant economic impact? 
Yes; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Resolution Plans Required for Insured Depository 
Institutions With $50 Billion or More in Total Assets; 
Responsible regulator: FDIC; 
Effective date: 04/01/12; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Protection of Cleared Swaps Customer Contracts and 
Collateral; Conforming Amendments to the Commodity Broker Bankruptcy 
Provisions; 
Responsible regulator: CFTC; 
Effective date: 04/09/12; 
Did regulator identify the rule as having significant economic impact? 
Yes; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Exemptions for Security-Based Swaps Issued by Certain 
Clearing Agencies; 
Responsible regulator: SEC; 
Effective date: 04/16/12; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; Did 
regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Business Conduct Standards for Swap Dealers and Major Swap 
Participants; 
Responsible regulator: CFTC; 
Effective date: 04/17/12; 
Did regulator identify the rule as having significant economic impact? 
Yes; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Commodity Pool Operators and Commodity Trading Advisers: 
Compliance Obligations; 
Responsible regulator: CFTC; 
Effective date: 04/24/12; 07/02/12; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? Yes; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Authority To Require Supervision and Regulation of Certain 
Nonbank Financial Companies; 
Responsible regulator: FSOC; 
Effective date: 05/11/12; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? No; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Implementation of the Freedom of Information Act; 
Responsible regulator: FSOC; 
Effective date: 05/11/12; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? No. 

Rulemaking: Investment Advisor Performance Compensation Rule; 
Responsible regulator: SEC; 
Effective date: 05/22/12; 
Did regulator identify the rule as having significant economic impact? 
Yes; 
Did regulator quantify costs of final rule other than PRA costs? Yes; 
Did regulator quantify benefits of final rule? Yes; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Mutual Insurance Holding Company Treated as Insurance 
Company; 
Responsible regulator: FDIC; 
Effective date: 05/30/12; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? No; 
Did regulator qualitatively identify benefits of final rule? No. 

Rulemaking: Swap Dealer and Major Swap Participant Recordkeeping, 
Reporting, and Duties Rules; Futures Commission Merchant and 
Introducing Broker Conflicts of Interest Rules; and Chief Compliance 
Officer Rules for Swap Dealers, Major Swap Participants, and Futures 
Commission Merchants; 
Responsible regulator: CFTC; 
Effective date: 06/04/12; 
Did regulator identify the rule as having significant economic impact? 
Yes; 
Did regulator quantify costs of final rule other than PRA costs? Yes; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Statement of Policy Regarding the Conformance Period for 
Entities Engaged in Prohibited Proprietary Trading or Private Equity 
Fund or Hedge Fund Activities; 
Responsible regulator: Federal Reserve; 
Effective date: 06/08/12; 
Did regulator identify the rule as having significant economic impact? 
N/A; 
Did regulator quantify costs of final rule other than PRA costs? N/A; 
Did regulator quantify benefits of final rule? N/A; 
Did regulator qualitatively identify costs of final rule? N/A; 
Did regulator qualitatively identify benefits of final rule? N/A. 

Rulemaking: Commodity Options; 
Responsible regulator: CFTC; 
Effective date: 06/26/12; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: State Official Notification Rule; 
Responsible regulator: CFPB; 
Effective date: 06/29/12; 
Did regulator identify the rule as having significant economic impact? 
N/A; 
Did regulator quantify costs of final rule other than PRA costs? N/A; 
Did regulator quantify benefits of final rule? N/A; 
Did regulator qualitatively identify costs of final rule? N/A; 
Did regulator qualitatively identify benefits of final rule? N/A. 

Rulemaking: Rules Relating to Investigations; 
Responsible regulator: CFPB; 
Effective date: 06/29/12; 
Did regulator identify the rule as having significant economic impact? 
N/A; 
Did regulator quantify costs of final rule other than PRA costs? N/A; 
Did regulator quantify benefits of final rule? N/A; 
Did regulator qualitatively identify costs of final rule? N/A; 
Did regulator qualitatively identify benefits of final rule? N/A. 

Rulemaking: Rules of Practice for Adjudication Proceedings; 
Responsible regulator: CFPB; 
Effective date: 06/29/12; 
Did regulator identify the rule as having significant economic impact? 
N/A; 
Did regulator quantify costs of final rule other than PRA costs? N/A; 
Did regulator quantify benefits of final rule? N/A; 
Did regulator qualitatively identify costs of final rule? N/A; 
Did regulator qualitatively identify benefits of final rule? N/A. 

Rulemaking: Collection of Checks and Other Items by Federal Reserve 
Banks and Funds Transfers Through Fedwire: Elimination of "As-of 
Adjustments" and Other Clarifications; 
Responsible regulator: Federal Reserve; 
Effective date: 07/12/12; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Assessment of Fees on Large Bank Holding Companies and 
Nonbank Financial Companies Supervised by the Federal Reserve Board To 
Cover the Expenses of the Financial Research Fund; 
Responsible regulator: Treasury; 
Effective date: 07/20/12; 
Did regulator identify the rule as having significant economic impact? 
Yes; 
Did regulator quantify costs of final rule other than PRA costs? Yes; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Rulemaking: Supervised Securities Holding Company Registration; 
Responsible regulator: Federal Reserve; 
Effective date: 07/20/12; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; Did regulator 
qualitatively identify costs of final rule? No; 
Did regulator qualitatively identify benefits of final rule? No. 

Rulemaking: Alternatives to the Use of External Credit Ratings in the 
Regulations of the OCC; 
Responsible regulator: OCC; 
Effective date: 07/21/12; 01/01/13; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No[A]; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? No; 
Did regulator qualitatively identify benefits of final rule? No. 

Rulemaking: Permissible Investments for Federal and State Savings 
Associations: Corporate Debt Securities; 
Responsible regulator: FDIC; 
Effective date: 07/21/12; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? No. 

Rulemaking: Guidance on Due Diligence Requirements for Savings 
Associations in Determining Whether a Corporate Debt Security Is 
Eligible for Investment; 
Responsible regulator: FDIC; 
Effective date: 07/21/12; 
Did regulator identify the rule as having significant economic impact? 
N/A; 
Did regulator quantify costs of final rule other than PRA costs? N/A; 
Did regulator quantify benefits of final rule? N/A; 
Did regulator qualitatively identify costs of final rule? N/A; 
Did regulator qualitatively identify benefits of final rule? N/A. 

Rulemaking: Guidance on Due Diligence Requirements in Determining 
Whether Securities Are Eligible for Investment; 
Responsible regulator: OCC; 
Effective date: 01/01/13[C]; 
Did regulator identify the rule as having significant economic impact? 
N/A; 
Did regulator quantify costs of final rule other than PRA costs? N/A; 
Did regulator quantify benefits of final rule? N/A; 
Did regulator qualitatively identify costs of final rule? N/A; 
Did regulator qualitatively identify benefits of final rule? N/A. 

Rulemaking: Supervisory Guidance on Stress Testing for Banking 
Organizations With More Than $10 Billion in Total Consolidated Assets; 
Responsible regulator: FDIC, Federal Reserve, and OCC; 
Effective date: 07/23/12; 
Did regulator identify the rule as having significant economic impact? 
N/A; 
Did regulator quantify costs of final rule other than PRA costs? 
N/A[A]; 
Did regulator quantify benefits of final rule? N/A; 
Did regulator qualitatively identify costs of final rule? N/A; 
Did regulator qualitatively identify benefits of final rule? N/A. 

Rulemaking: Calculation of Maximum Obligation Limitation; 
Responsible regulator: FDIC and Treasury; 
Effective date: 07/23/12; 
Did regulator identify the rule as having significant economic impact? 
No; 
Did regulator quantify costs of final rule other than PRA costs? No; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? No; 
Did regulator qualitatively identify benefits of final rule? No. 

Rulemaking: Further Definition of "Swap Dealer," "Security-Based Swap 
Dealer," "Major Swap Participant," "Major Security-Based Swap 
Participant," and "Eligible Contract Participant"; 
Responsible regulator: CFTC and SEC; 
Effective date: 07/23/12; 12/31/12; 
Did regulator identify the rule as having significant economic impact? 
Yes; 
Did regulator quantify costs of final rule other than PRA costs? Yes; 
Did regulator quantify benefits of final rule? No; 
Did regulator qualitatively identify costs of final rule? Yes; 
Did regulator qualitatively identify benefits of final rule? Yes. 

Source: GAO summary of information from the Federal Register, the 
Federal Reserve Bank of St. Louis [hyperlink, 
http://www.stlouisfed.org/regreformrules/final.aspx] and Davis Polk & 
Wardwell LLP. 

Note: N/A refers to those rulemakings related to interpretive rules, 
general statements of policy, and rules that deal with agency 
organization, procedure, or practice, and thus not subject to 
Administrative Procedure Act requirements. 

[A] OCC undertook an assessment of these rules, which included 
quantified total cost estimates, but the assessments were not 
published in the Federal Register notices. 

[B] Compliance dates vary. 

[C] OCC's guidance is included in this review, even though the 
effective date is outside our scope period, because the accompanying 
rule and similar FDIC guidance are included in this review. 

[End of table] 

The following table lists the Dodd-Frank rules that we identified as 
final and effective during the scope period for our November 2011 
review--July 21, 2010, through July 21, 2011. 

Table 6: Dodd-Frank Rules Effective as of July 21, 2011: 

Rulemaking: Deposit Insurance Regulations; Permanent Increase in 
Standard Coverage Amount; Advertisement of Membership; International 
Banking; Foreign Banks (75 Fed. Reg. 49,363); 
Responsible regulator: FDIC; 
Effective date: 8/13/2010; 
Did the regulator have some level of discretion? No; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Rulemaking: Display of Official Sign; Permanent Increase in Standard 
Maximum Share (75 Fed. Reg. 53,841); 
Responsible regulator: NCUA; 
Effective date: 9/2/2010; 
Did the regulator have some level of discretion? No; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Rulemaking: Internal Controls over Financial Reporting in Exchange Act 
Periodic Reports (75 Fed. Reg. 57,385); 
Responsible regulator: SEC; 
Effective date: 9/21/2010; 
Did the regulator have some level of discretion? No; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Rulemaking: Commission Guidance Regarding Auditing, Attestation, and 
Related Professional Practice Standards Related to Brokers and Dealers 
(75 Fed. Reg. 60,616); 
Responsible regulator: SEC; 
Effective date: 10/1/2010; 
Did the regulator have some level of discretion? N/A; 
Did the regulator identify the rule as having significant economic 
impact? N/A. 

Rulemaking: Removal from Regulation FD of the Exemption for Credit 
Rating Agencies (75 Fed. Reg. 61,050); 
Responsible regulator: SEC; 
Effective date: 10/4/2010; 
Did the regulator have some level of discretion? No; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Rulemaking: Regulation of Off-Exchange Retail Foreign Exchange 
Transactions and Intermediaries (75 Fed. Reg. 55,410); 
Responsible regulator: CFTC; 
Effective date: 10/18/2010; 
Did the regulator have some level of discretion? Yes; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Rulemaking: Deposit Insurance Regulations: Unlimited Coverage for 
Noninterest-Bearing Transaction Accounts (75 Fed. Reg. 69,577); 
Responsible regulator: FDIC; 
Effective date: 12/31/2010; 
Did the regulator have some level of discretion? No; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Rulemaking: Designated Reserve Ratio (75 Fed. Reg. 79,286); 
Responsible regulator: FDIC; 
Effective date: 1/1/2011; 
Did the regulator have some level of discretion? Yes; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Rulemaking: Rules of Practice -Handling of Proposed Rule Changes 
Submitted by Self-Regulatory Organizations (76 Fed. Reg. 4066); 
Responsible regulator: SEC; 
Effective date: 1/24/2011; 
Did the regulator have some level of discretion? N/A; 
Did the regulator identify the rule as having significant economic 
impact? N/A. 

Rulemaking: Deposit Insurance Regulations; Unlimited Coverage for 
Noninterest-Bearing Transaction Accounts; Inclusion of Interest on 
Lawyers Trust Accounts (76 Fed. Reg. 4813); 
Responsible regulator: FDIC; 
Effective date: 1/27/2011; 
Did the regulator have some level of discretion? No; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Rulemaking: Issuer Review of Assets in Offerings of Asset-Back 
Securities (76 Fed. Reg. 4231); 
Responsible regulator: SEC; 
Effective date: 3/28/2011; 
Did the regulator have some level of discretion? Yes; 
Did the regulator identify the rule as having significant economic 
impact? Yes. 

Rulemaking: Disclosure for Asset-Backed Securities Required by Section 
943 of the Dodd-Frank Wall Street Reform and Consumer Protection Act 
(76 Fed. Reg. 4489); 
Responsible regulator: SEC; 
Effective date: 3/28/2011; 
Did the regulator have some level of discretion? Yes; 
Did the regulator identify the rule as having significant economic 
impact? Yes. 

Rulemaking: Conformance Period for Entities Engaged in Prohibited 
Proprietary Trading or Private Equity Fund or Hedge Fund Activities (76 
Fed. Reg. 8265); 
Responsible regulator: Federal Reserve; 
Effective date: 4/1/2011; 
Did the regulator have some level of discretion? Yes; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Rulemaking: Assessments, Large Bank Pricing (76 Fed. Reg. 10,672); 
Responsible regulator: FDIC; 
Effective date: 4/1/2011; 
Did the regulator have some level of discretion? Yes; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Rulemaking: Higher Rate Threshold for Escrow Requirements (76 Fed. Reg. 
11,319); 
Responsible regulator: Federal Reserve; 
Effective date: 4/1/2011; 
Did the regulator have some level of discretion? No; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Rulemaking: Shareholder Approval of Executive Compensation and Golden 
Parachute Compensation (76 Fed. Reg. 6010); 
Responsible regulator: SEC; 
Effective date: 4/4/2011; 
Did the regulator have some level of discretion? Yes; 
Did the regulator identify the rule as having significant economic 
impact? Yes. 

Rulemaking: Establishment of the FDIC Systemic Resolution Advisory 
Committee (76 Fed. Reg. 25,352); 
Responsible regulator: FDIC; 
Effective date: 4/28/2011; 
Did the regulator have some level of discretion? N/A; 
Did the regulator identify the rule as having significant economic 
impact? N/A. 

Rulemaking: Order Directing Funding for the Governmental Accounting 
Standards Board (76 Fed. Reg. 28,247); 
Responsible regulator: SEC; 
Effective date: 5/16/2011; 
Did the regulator have some level of discretion? N/A; 
Did the regulator identify the rule as having significant economic 
impact? N/A. 

Rulemaking: Share Insurance and Appendix (76 Fed. Reg. 30,250); 
Responsible regulator: NCUA; 
Effective date: 6/24/2011; 
Did the regulator have some level of discretion? No; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Rulemaking: Modification of Treasury Regulations Pursuant to Section 
939A of the Dodd-Frank Wall Street Reform and Consumer Protection Act 
(76 Fed. Reg. 39,278); 
Responsible regulator: Treasury; 
Effective date: 7/6/2011; 
Did the regulator have some level of discretion? No; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Rulemaking: Retail Foreign Exchange Transactions (76 Fed. Reg. 40,779); 
Responsible regulator: FDIC; 
Effective date: 7/15/2011; 
Did the regulator have some level of discretion? Yes; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Rulemaking: Retail Foreign Exchange Transactions (76 Fed. Reg. 41,375); 
Responsible regulator: OCC; 
Effective date: 7/15/2011; 
Did the regulator have some level of discretion? Yes; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Rulemaking: Beneficial Ownership Reporting Requirements and Security-
Based Swaps (76 Fed. Reg. 34,579); 
Responsible regulator: SEC; 
Effective date: 7/16/2011; 
Did the regulator have some level of discretion? Yes; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Rulemaking: Prohibition Against Payment of Interest on Demand Deposits 
(76 Fed. Reg. 42,015); 
Responsible regulator: Federal Reserve; 
Effective date: 7/21/2011; 
Did the regulator have some level of discretion? No; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Rulemaking: List of OTS Regulations to be Enforced by the OCC and FDIC 
Pursuant to the Dodd-Frank Act (76 Fed. Reg. 39,246); 
Responsible regulator: OCC/FDIC; 
Effective date: 7/21/2011; 
Did the regulator have some level of discretion? N/A; 
Did the regulator identify the rule as having significant economic 
impact? N/A. 

Rulemaking: Office of Thrift Supervision Integration; Dodd-Frank Act 
Implementation (76 Fed. Reg. 43,549); 
Responsible regulator: OCC; 
Effective date: 7/21/2011; 
Did the regulator have some level of discretion? N/A; 
Did the regulator identify the rule as having significant economic 
impact? N/A. 

Rulemaking: Exemptions for Advisers to Venture Capital Funds, Private 
Fund Advisers With Less Than $150 Million in Assets Under Management, 
and Foreign Private Advisers (76 Fed. Reg. 39,646); 
Responsible regulator: SEC; 
Effective date: 7/21/2011; 
Did the regulator have some level of discretion? Yes; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Rulemaking: Consumer Transfer Protection Date (75 Fed. Reg. 57,252); 
Responsible regulator: CFPB; 
Effective date: 7/21/2011; 
Did the regulator have some level of discretion? N/A; 
Did the regulator identify the rule as having significant economic 
impact? N/A. 

Rulemaking: Identification of Enforceable Rules and Orders (76 Fed. 
Reg. 43,569); 
Responsible regulator: CFPB; 
Effective date: 7/21/2011; 
Did the regulator have some level of discretion? N/A; 
Did the regulator identify the rule as having significant economic 
impact? N/A. 

Rulemaking: Consumer Leasing - Exempt Consumer Credit under Regulation 
M (75 Fed. Reg. 18,349); 
Responsible regulator: Federal Reserve; 
Effective date: 7/21/2011; 
Did the regulator have some level of discretion? No; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Rulemaking: Truth in Lending - Exempt Consumer Credit under Regulation 
Z (76 Fed. Reg. 18,354); 
Responsible regulator: Federal Reserve; 
Effective date: 7/21/2011; 
Did the regulator have some level of discretion? No; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Rulemaking: Interest on Deposits; Deposit Insurance Coverage (76 Fed. 
Reg. 41,392); 
Responsible regulator: FDIC; 
Effective date: 7/21/2011; 
Did the regulator have some level of discretion? No; 
Did the regulator identify the rule as having significant economic 
impact? No. 

Source: GAO summary of information from the Federal Register and 
Federal Reserve Bank of St. Louis [hyperlink, 
http://www.stlouisfed.org/regreformrules/final.aspx]. 

Note: N/A refers to those rulemakings related to interpretive rules, 
general statements of policy, and rules that deal with agency 
organization, procedure, or practice, and thus not subject to 
Administrative Procedure Act requirements. In some instances, we found 
that an agency had discretion to implement the statute, even though 
the discretion was limited, because the exercise of discretion was 
important to implementation. 

[End of table] 

[End of section] 

Appendix III: Dodd-Frank Rules Classified as Major, Final as of July 
22, 2013: 

The following table lists the Dodd-Frank rules that have been 
designated as major by OMB and are final as of July 22, 2013. 

Table 7: Dodd-Frank Rules Classified as Major, Final as of July 22, 
2013: 

Rulemaking: Issuer Review of Assets in Offerings of Asset-Backed 
Securities; 
Responsible regulator: SEC; 
Published date: 1/25/2011; 
Effective date: 3/28/2011. 

Rulemaking: Disclosure for Asset-Backed Securities; 
Responsible regulator: SEC; 
Published date: 1/26/2011; 
Effective date: 3/28/2011. 

Rulemaking: Shareholder Approval of Executive Compensation and Golden 
Parachute Compensation; 
Responsible regulator: SEC; 
Published date: 2/2/2011; 
Effective date: 4/4/2011. 

Rulemaking: Securities Whistleblower Incentives and Protections; 
Responsible regulator: SEC; 
Published date: 6/13/2011; 
Effective date: 8/12/2011. 

Rulemaking: Family Offices; 
Responsible regulator: SEC; 
Published date: 6/29/2011; 
Effective date: 8/29/2011. 

Rulemaking: Rules Implementing Amendments to the Investment Advisers 
Act of 1940; 
Responsible regulator: SEC; 
Published date: 7/19/2011; 
Effective date: 7/21/2011. 

Rulemaking: Debit Card Interchange Fees and Routing; 
Responsible regulator: FRS; 
Published date: 7/20/2011; 
Effective date: 10/1/2011. 

Rulemaking: Whistleblower Incentives and Protection; 
Responsible regulator: CFTC; 
Published date: 8/25/2011; 
Effective date: 10/24/2011. 

Rulemaking: Swap Data Repositories: Registration Standards Duties and 
Core Principles; 
Responsible regulator: CFTC; 
Published date: 9/1/2011; 
Effective date: 10/31/2011. 

Rulemaking: Derivatives Clearing Organization General Provisions and 
Core Principles; 
Responsible regulator: CFTC; 
Published date: 11/8/2011; 
Effective date: 1/9/2012. 

Rulemaking: Reporting by Investment Advisers to Private Funds and 
Certain Commodity Pool Operators and Commodity Trading Advisors on Form 
PF; 
Responsible regulator: CFTC and SEC; 
Published date: 11/16/2011; 
Effective date: 3/31/2012. 

Rulemaking: Positions Limits for Futures and Swaps; 
Responsible regulator: CFTC; 
Published date: 11/18/2011; 
Effective date: 1/17/2012. 

Rulemaking: Investment of Customer Funds and Funds Held in and Account 
for Foreign Futures and Foreign Options Transactions; 
Responsible regulator: CFTC; 
Published date: 12/19/2011; 
Effective date: 2/17/2012. 

Rulemaking: Net Worth Standard for Accredited Investors; 
Responsible regulator: SEC; 
Published date: 12/29/2011; 
Effective date: 2/27/2012. 

Rulemaking: Real-time Public Reporting of Swap Transaction Data; 
Responsible regulator: CFTC; 
Published date: 1/9/2012; 
Effective date: 3/9/2012. 

Rulemaking: Swap Data Recordkeeping and Reporting Requirements; 
Responsible regulator: CFTC; 
Published date: 1/13/2012; 
Effective date: 3/13/2012. 

Rulemaking: Protection of Cleared Swaps Customer Contracts and 
Collateral; Conforming Amendments to the Commodity Broker Bankruptcy 
Provisions; 
Responsible regulator: CFTC; 
Published date: 2/7/2012; 
Effective date: 4/9/2012. 

Rulemaking: Electronic Fund Transfers (Regulation E); 
Responsible regulator: CFPB; 
Published date: 2/7/2012; 
Effective date: 2/7/2013. 

Rulemaking: Business Conduct Standards for Swap Dealers and Major Swap 
Participants with Counterparties; 
Responsible regulator: CFTC; 
Published date: 2/17/2012; 
Effective date: 4/17/2012. 

Rulemaking: Investment Advisor Performance Compensation; 
Responsible regulator: SEC; 
Published date: 2/22/2012; 
Effective date: 5/22/2012. 

Rulemaking: Swap Dealer and Major Swap Participant Recordkeeping, 
Reporting, and Duties Rules; Futures Commission Merchant and 
Introducing Broker Conflicts of Interest rules; and Chief Compliance 
Officer Rules for Swap Dealers, Major Swap Participants, and Futures 
Commission Merchants; 
Responsible regulator: CFTC; 
Published date: 4/3/2012; 
Effective date: 6/4/2012. 

Rulemaking: Customer Clearing Documentation, Timing of Acceptance for 
Clearing, and Clearing Member Risk Management; 
Responsible regulator: CFTC; 
Published date: 4/9/2012; 
Effective date: 10/1/2012. 

Rulemaking: Assessment of Fees on Large Bank Holding Companies and 
Nonbank Financial Companies Supervised by the Federal Reserve Board To 
Cover the Expenses of the Financial Research Fund; 
Responsible regulator: Treasury; 
Published date: 5/21/2012; 
Effective date: 7/20/2012. 

Rulemaking: Further Definition of Swap Dealer, Security-Based Swap 
Dealer, Major Swap Participant, Major Security-Based Swap Participant, 
and Eligible Contract Participant Agreement; 
Responsible regulator: CFTC and SEC; 
Published date: 5/23/2012; 
Effective date: 7/23/2012. 

Rulemaking: Core Principles and Other Requirements for Designated 
Contract Markets; 
Responsible regulator: CFTC; 
Published date: 6/19/2012; 
Effective date: 8/20/2012. 

Rulemaking: Debit Card Interchange Fees and Routing; 
Responsible regulator: FRS; 
Published date: 8/3/2012; 
Effective date: 10/1/2012. 

Rulemaking: Further Definition of Swap, Security-Based Swap and 
Security-Based Swap Agreement; Mixed Swaps; Security-Based Swap 
Agreement Recordkeeping; 
Responsible regulator: CFTC and SEC; 
Published date: 8/13/2012; 
Effective date: 10/12/2012. 

Rulemaking: Risk-Based Capital Guidelines: Market Risk; 
Responsible regulator: OCC, FRS, & FDIC; 
Published date: 8/30/2012; 
Effective date: 1/1/2013. 

Rulemaking: Disclosure of Payments by Resource Extraction Issuers[A]; 
Responsible regulator: SEC; 
Published date: 9/12/2012; 
Effective date: 11/13/2012. 

Rulemaking: Conflict Minerals; 
Responsible regulator: SEC; 
Published date: 9/12/2012; 
Effective date: 11/13/2012. 

Rulemaking: Ability-to-Repay and Qualified Mortgage Standards Under the 
Truth in Lending Act (Regulation Z); 
Responsible regulator: CFPB; 
Published date: 1/30/2013; 
Effective date: 1/10/2014. 

Rulemaking: Mortgage Servicing Rules Under the Truth in Lending Act 
(Regulation Z); 
Responsible regulator: CFPB; 
Published date: 2/14/2013; 
Effective date: 1/10/2014. 

Rulemaking: Mortgage Servicing Rules Under the Real Estate Settlement 
Procedures Act (Regulation X); 
Responsible regulator: CFPB; 
Published date: 2/14/2013; 
Effective date: 1/10/2014. 

Rulemaking: Loan Originator Compensation Requirements Under the Truth 
in Lending Act (Regulation Z); 
Responsible regulator: CFPB; 
Published date: 2/15/2013; 
Effective date: 6/1/2013. 

Rulemaking: Clearing Exemption for Swaps Between Certain Affiliated 
Entities; 
Responsible regulator: CFTC; 
Published date: 4/11/2013; 
Effective date: 6/10/2013. 

Rulemaking: Core Principles and Other Requirements for Swap Execution 
Facilities; 
Responsible regulator: CFTC; 
Published date: 6/4/2013; 
Effective date: 8/5/2013. 

Source: Federal Register, GAO's Federal Rules database available at 
[hyperlink, http://www.gao.gov/legal/congressact/congress.html]. 

[A] This rule is no longer in effect because it was vacated by a 
decision of the U.S. District Court for the District of Columbia on 
July 2, 2013. See American Petroleum Institute et al. v. SEC, ---
F.Supp.2d ---, 2013 WL 3307114 (D.D.C. 2013). 

[End of table] 

[End of section] 

Appendix IV: Interagency Coordination for Dodd-Frank Rules Effective 
on July 24, 2012, through July 22, 2013: 

The following table lists Dodd-Frank rules effective from July 24, 
2012 through July 22, 2013 where the issuing regulator(s) coordinated 
with at least one other federal or foreign regulator during the 
rulemaking process. 

Table 8: Evidence of Interagency Coordination in Dodd-Frank 
Regulations Effective July 24, 2012, through July 22, 2013: 

Rulemaking: Electronic Fund Transfers (Regulation E); 
Responsible regulator: CFPB; 
Published date: 2/7/2012; 
Effective date*: 2/7/2013; 
Coordination required? Yes; 
Nature of coordination: CFPB consulted or offered to consult with the 
prudential regulators, and the Federal Trade Commission[A]; 
Voluntary coordination? N/A. 

Rulemaking: Customer Clearing Documentation, Timing of Acceptance for 
Clearing, and Clearing Member Risk Management; 
Responsible regulator: CFTC; 
Published date: 4/9/2012; 
Effective date*: 10/1/2012; 
Coordination required? No; 
Nature of coordination: CFTC coordinated 
with SEC and the Federal Reserve; 
Voluntary coordination? Yes. 

Rulemaking: Guidance on the Effective Date of Section 716 of the Dodd-
Frank Wall Street Reform and Consumer Protection Act; 
Responsible regulator: FDIC, Federal Reserve, and OCC; 
Published date: 5/10/2012; 
Effective date*: 7/16/2013; 
Coordination required? No; 
Nature of coordination: Jointly issued guidance; 
Voluntary coordination? Yes. 

Rulemaking: Swap Data Recordkeeping and Reporting Requirements: Pre-
Enactment and Transition Swaps; 
Responsible regulator: CFTC; 
Published date: 6/12/2012; 
Effective date*: 8/13/2012; 
Coordination required? Yes; 
Nature of coordination: CFTC coordinated with the Federal Reserve, 
FDIC, OCC, and SEC[C]; 
Voluntary coordination? N/A. 

Rulemaking: Core Principles and Other Requirements for Designated 
Contract Markets; 
Responsible regulator: CFTC; 
Published date: 6/19/2012; 
Effective date*: 8/20/2012; 
Coordination required? Yes; 
Nature of coordination: CFTC coordinated with SEC[C]; 
Voluntary coordination? N/A. 

Rulemaking: Confidential Treatment of Privileged Information; 
Responsible regulator: CFPB; 
Published date: 7/5/2012; 
Effective date*: 8/6/2012; 
Coordination required? Unclear; 
Nature of coordination: Although unclear about the applicability of 
Dodd-Frank section 1022(b)(2), to inform the rulemaking more fully, 
CFPB consulted or offered to consult with the prudential regulators 
and the Federal Trade Commission[A]; 
Voluntary coordination? Unclear. 

Rulemaking: Process for Submissions for Review of Security-Based Swaps 
for Mandatory Clearing and Notice Filing Requirements for Clearing 
Agencies; Technical Amendments to Rule 19b-4 and Form 19b-4 Applicable 
to All Self-Regulatory Organizations; 
Responsible regulator: SEC; 
Published date: 7/13/2012; 
Effective date*: 8/13/2012; 
Coordination required? Yes; 
Nature of coordination: SEC consulted with CFTC and the prudential 
regulators[B]; 
Voluntary coordination? N/A. 

Rulemaking: End-User Exception to the Clearing Requirement for Swaps; 
Responsible regulator: CFTC; 
Published date: 7/19/2012; 
Effective date*: 9/17/2012; 
Coordination required? Yes; 
Nature of coordination: CFTC coordinated with SEC[C]; 
Voluntary coordination? N/A. 

Rulemaking: Defining Larger Participants of the Consumer Reporting 
Market; 
Responsible regulator: CFPB; 
Published date: 7/20/2012; 
Effective date*: 9/30/2012; 
Coordination required? Unclear; 
Nature of coordination: Although unclear about the applicability of 
Dodd-Frank section 1022(b)(2), to inform the rulemaking more fully, 
CFPB consulted or offered to consult with the prudential regulators 
and the Federal Trade Commission. CFPB also requested comments on the 
final rule from relevant state agencies[A]; 
Voluntary coordination? Unclear. 

Rulemaking: Swap Transaction Compliance and Implementation Schedule: 
Clearing Requirement Under Section 2(h) of the CEA; 
Responsible regulator: CFTC; 
Published date: 7/30/2012; 
Effective date*: 9/28/2012; 
Coordination required? Yes; 
Nature of coordination: CFTC consulted with SEC, prudential 
regulators, and foreign regulators[C,D]; 
Voluntary coordination? N/A. 

Rulemaking: Financial Market Utilities; 
Responsible regulator: Federal Reserve; 
Published date: 8/2/2012; 
Effective date*: 9/14/2012; 
Coordination required? Yes; 
Nature of coordination: The Federal Reserve consulted with FSOC, SEC 
and CFTC; 
Voluntary coordination? N/A. 

Rulemaking: Debit Card Interchange Fees and Routing; 
Responsible regulator: Federal Reserve; 
Published date: 8/3/2012; 
Effective date*: 10/1/2012; 
Coordination required? Yes; 
Nature of coordination: The Federal Reserve consulted with OCC, FDIC, 
NCUA, the Small Business Administration, and CFPB; 
Voluntary coordination? N/A. 

Rulemaking: Further Definition of "Swap," "Security-Based Swap," 
and "Security-Based Swap Agreement"; Mixed Swaps; Security-Based Swap 
Agreement Recordkeeping; 
Responsible regulator: CFTC and SEC; 
Published date: 8/13/2012; 
Effective date*: 10/12/2012; 
Coordination required? Yes; 
Nature of coordination: Jointly issued rule[B,C]; 
Voluntary coordination? N/A. 

Rulemaking: Electronic Fund Transfers (Regulation E); 
Responsible regulator: CFPB; 
Published date: 8/20/2012; 
Effective date*: 2/7/2013; 
Coordination required? Yes; 
Nature of coordination: CFPB consulted or offered to consult with the 
prudential regulators and the Federal Trade Commission[A]; 
Voluntary coordination? N/A. 

Rulemaking: Registration of Intermediaries; 
Responsible regulator: CFTC; 
Published date: 8/28/2012; 
Effective date*: 10/29/2012; 
Coordination required? No; 
Nature of coordination: CFTC coordinated with SEC; 
Voluntary coordination? Yes. 

Rulemaking: Risk-Based Capital Guidelines: Market Risk; 
Responsible regulator: FDIC, Federal Reserve, and OCC; 
Published date: 8/30/2012; 
Effective date*: 1/1/2013; 
Coordination required? No; 
Nature of coordination: Jointly issued rule; 
Voluntary coordination? Yes. 

Rulemaking: Confirmation, Portfolio Reconciliation, Portfolio 
Compression, and Swap Trading Relationship Documentation Requirements 
for Swap Dealers and Major Swap Participants; 
Responsible regulator: CFTC; 
Published date: 9/11/2012; 
Effective date*: 11/13/2012; 
Coordination required? Yes; 
Nature of coordination: CFTC consulted with SEC, Federal Reserve, 
FDIC, OCC, and foreign regulators including the European Securities 
and Markets Authority[C,D]; 
Voluntary coordination? N/A. 

Rulemaking: Conflict Minerals; 
Responsible regulator: SEC; 
Published date: 9/12/2012; 
Effective date*: 11/13/2012; 
Coordination required? No; 
Nature of coordination: SEC coordinated with other federal agencies, 
including the U.S. Department of State, and GAO; 
Voluntary coordination? Yes. 

Rulemaking: Annual Stress Test; 
Responsible regulator: OCC; 
Published date: 10/9/2012; 
Effective date*: 10/9/2012; 
Coordination required? Yes; 
Nature of coordination: As required by the act, OCC coordinated with 
the Federal Reserve and FIO. OCC also coordinated with the other 
banking regulators; 
Voluntary coordination? Yes. 

Rulemaking: Supervisory and Company-Run Stress Test Requirements for 
Covered Companies; 
Responsible regulator: Federal Reserve; 
Published date: 10/12/2012; 
Effective date*: 11/15/2012; 
Coordination required? Yes; 
Nature of coordination: The Federal Reserve coordinated with the 
Federal Insurance Office, FDIC, and OCC; 
Voluntary coordination? N/A. 

Rulemaking: Annual Company-Run Stress Test Requirements for Banking 
Organizations With Total Consolidated Assets Over $10 Billion Other 
Than Covered Companies; 
Responsible regulator: Federal Reserve; 
Published date: 10/12/2012; 
Effective date*: 11/15/2012; 
Coordination required? Yes; 
Nature of coordination: The Federal Reserve coordinated with the 
Federal Insurance Office, FDIC, and OCC; 
Voluntary coordination? N/A. 

Rulemaking: Annual Stress Test; 
Responsible regulator: FDIC; 
Published date: 10/15/2012; 
Effective date*: 10/15/2012; 
Coordination required? Yes; 
Nature of coordination: As required by the act, FDIC coordinated 
with the Federal Reserve and the Federal Insurance Office (FIO). FDIC 
also consulted with the other banking regulators; 
Voluntary coordination? Yes. 

Rulemaking: Enforcement of Subsidiary and Affiliate Contracts by the 
FDIC as Receiver of a Covered Financial Company; 
Responsible regulator: FDIC; 
Published date: 10/16/2012; 
Effective date*: 11/15/2012; 
Coordination required? Yes; 
Nature of coordination: FDIC consulted with FSOC; 
Voluntary coordination? N/A. 

Rulemaking: Swap Data Repositories: Interpretative Statement Regarding 
the Confidentiality and Indemnification Provisions of the Commodity 
Exchange Act; 
Responsible regulator: CFTC; 
Published date: 10/25/2012; 
Effective date*: 10/25/2012; 
Coordination required? Yes; 
Nature of coordination: CFTC consulted with foreign regulators.[D]; 
Voluntary coordination? N/A. 

Rulemaking: Defining Larger Participants of the Consumer Debt 
Collection Market; 
Responsible regulator: CFPB; 
Published date: 10/31/2012; 
Effective date*: 1/2/2013; 
Coordination required? Unclear; 
Nature of coordination: Although unclear about the applicability of 
Dodd-Frank section 1022(b)(2), to inform the rulemaking more fully, 
CFPB consulted or offered to consult with the prudential regulators, 
the Department of Education, the Department of Housing and Urban 
Development, the Federal Housing Finance Agency, and the Federal Trade 
Commission.[A]; 
Voluntary coordination? Unclear. 

Rulemaking: Clearing Agency Standards; 
Responsible regulator: SEC; 
Published date: 11/2/2012; 
Effective date*: 1/2/2013; 
Coordination required? Yes; 
Nature of coordination: SEC consulted with the Federal Reserve and 
FSOC. SEC consulted with other financial regulators as appropriate; 
Voluntary coordination? N/A. 

Rulemaking: Determination of Foreign Exchange Swaps and Foreign 
Exchange Forwards Under the Commodity Exchange Act; 
Responsible regulator: Treasury; 
Published date: 11/20/2012; 
Effective date*: 11/20/2012; 
Coordination required? No; 
Nature of coordination: Treasury consulted with federal regulators; 
Voluntary coordination? Yes. 

Rulemaking: Truth in Lending (Regulation Z); 
Responsible regulator: CFPB and Federal Reserve; 
Published date: 11/21/2012; 
Effective date*: 1/1/2013; 
Coordination required? Yes; 
Nature of coordination: Jointly issued rule[A]; 
Voluntary coordination? N/A. 

Rulemaking: Consumer Leasing (Regulation M); 
Responsible regulator: CFPB and Federal Reserve; 
Published date: 11/21/2012; 
Effective date*: 1/1/2013; 
Coordination required? Yes; 
Nature of coordination: Jointly issued rule[A]; 
Voluntary coordination? N/A. 

Rulemaking: Delayed Implementation of Certain New Mortgage Disclosures; 
Responsible regulator: CFPB; 
Published date: 11/23/2012; 
Effective date*: 11/23/2012; 
Coordination required? Yes; 
Nature of coordination: CFPB consulted or offered to consult with the 
prudential regulators, the Department of Housing and Urban 
Development, and the Federal Trade Commission. CFPB also held 
discussions with or solicited feedback from the Department of Veterans 
Affairs, the Farm Credit Administration, the Federal Housing 
Administration, the Federal Housing Finance Agency, and the Department 
of Agriculture Rural Housing Service[A]; 
Voluntary coordination? N/A. 

Rulemaking: Clearing Requirement Determination Under Section 2(h) of 
the CEA; 
Responsible regulator: CFTC; 
Published date: 12/13/2012; 
Effective date*: 2/11/2013; 
Coordination required? Yes; 
Nature of coordination: CFTC consulted with SEC, Federal Reserve, 
FDIC, OCC, and foreign regulators[C,D]; 
Voluntary coordination? N/A. 

Rulemaking: Community Reinvestment Act Regulations; 
Responsible regulator: FDIC, Federal Reserve, and OCC; 
Published date: 12/21/2012; 
Effective date*: 1/1/2013; 
Coordination required? No; 
Nature of coordination: Jointly issued rule; 
Voluntary coordination? Yes. 

Rulemaking: Final Exemptive Order Regarding Compliance with Certain 
Swap Regulations; 
Responsible regulator: CFTC; 
Published date: 1/7/2013; 
Effective date*: 12/21/2012; 
Coordination required? Yes; 
Nature of coordination: CFTC consulted with SEC and foreign 
regulators[C,D]; 
Voluntary coordination? N/A. 

Rulemaking: Escrow Requirements Under the Truth in Lending Act 
(Regulation Z); 
Responsible regulator: CFPB; 
Published date: 1/22/2013; 
Effective date*: 6/1/2013; 
Coordination required? Yes; 
Nature of coordination: CFPB consulted or offered to consult with the 
prudential regulators, the Department of Housing and Urban 
Development, and Federal Trade Commission[A]; 
Voluntary coordination? N/A. 

Rulemaking: Loan Originator Compensation Requirements Under the Truth 
in Lending Act (Regulation Z); 
Responsible regulator: CFPB; 
Published date: 2/15/2013; 
Effective date*: 6/1/2013; 
Coordination required? Yes; 
Nature of coordination: CFPB consulted or offered to consult with the 
prudential regulators, the Department of Housing and Urban Development, 
the Federal Housing Finance Agency, and the Federal Trade Commission.a; 
Voluntary coordination? N/A. 

Rulemaking: Disclosure of Records and Information; 
Responsible regulator: CFPB; 
Published date: 2/15/2013; 
Effective date*: 3/18/2013; 
Coordination required? Unclear; 
Nature of coordination: Although unclear about the applicability of 
Dodd-Frank section 1022(b)(2), to inform the rulemaking more fully, 
CFPB consulted or offered to consult with the prudential regulators[A]; 
Voluntary coordination? Unclear. 

Rulemaking: Disclosures at Automated Teller Machines (Regulation E); 
Responsible regulator: CFPB; 
Published date: 3/26/2013; 
Effective date*: 3/26/2013; 
Coordination required? Unclear; 
Nature of coordination: Although unclear about the applicability of 
Dodd-Frank section 1022(b)(2), to inform the rulemaking more fully, 
CFPB consulted or offered to consult with the prudential regulators 
and the Federal Trade Commission[A]; 
Voluntary coordination? Unclear. 

Rulemaking: Truth in Lending (Regulation Z); 
Responsible regulator: CFPB; 
Published date: 3/28/2013; 
Effective date*: 3/28/2013; 
Coordination required? Yes; 
Nature of coordination: CFPB consulted or offered to consult with the 
prudential regulators and the Federal Trade Commission.[A]; 
Voluntary coordination? N/A. 

Rulemaking: Final Order in Response to a Petition From Certain 
Independent System Operators and Regional Transmission Organizations To 
Exempt Specified Transactions Authorized by a Tariff or Protocol 
Approved by the Federal Energy Regulatory Commission or the Public 
Utility Commission of Texas From Certain Provisions of the Commodity 
Exchange Act Pursuant to the Authority Provided in the Act; 
Responsible regulator: CFTC; 
Published date: 4/2/2013; 
Effective date*: 4/2/2013; 
Coordination required? No; 
Nature of coordination: CFTC coordinated with the Federal Energy 
Regulatory Commission and the Public Utility Commission of Texas; 
Voluntary coordination? Yes. 

Rulemaking: Definitions of "Predominantly Engaged In Financial 
Activities" and "Significant" Nonbank Financial Company and Bank 
Holding Company; 
Responsible regulator: Federal Reserve; 
Published date: 4/5/2013; 
Effective date*: 5/6/2013; 
Coordination required? No; 
Nature of coordination: The Federal Reserve consulted with the other 
FSOC members and member agencies; 
Voluntary coordination? Yes. 

Rulemaking: Retail Foreign Exchange Transactions (Regulation NN); 
Responsible regulator: Federal Reserve; 
Published date: 4/9/2013; 
Effective date*: 5/13/2013; 
Coordination required? No; 
Nature of coordination: The Federal Reserve consulted with OCC and 
FDIC and considered CFTC's retail forex rule (adopted on Sep. 10, 
2010); 
Voluntary coordination? Yes. 

Rulemaking: Clearing Exemption for Swaps Between Certain Affiliated 
Entities; 
Responsible regulator: CFTC; 
Published date: 4/11/2013; 
Effective date*: 6/10/2013; 
Coordination required? Yes; 
Nature of coordination: CFTC consulted with FDIC, Federal Reserve, 
OCC, SEC, and foreign regulators including the European Securities and 
Markets Authority, European Central Bank, and regulators in the United 
Kingdom, Japan, Hong Kong, Singapore, Sweden, and Canada.[C,D]; 
Voluntary coordination? N/A. 

Rulemaking: Identity Theft Red Flags Rules; 
Responsible regulator: CFTC and SEC; 
Published date: 4/19/2013; 
Effective date*: 5/20/2013; 
Coordination required? Yes; 
Nature of coordination: Jointly issued rule; 
Voluntary coordination? N/A. 

Rulemaking: Truth in Lending (Regulation Z); 
Responsible regulator: CFPB; 
Published date: 5/3/2013; 
Effective date*: 5/3/2013; 
Coordination required? Yes; 
Nature of coordination: CFPB consulted or offered to consult with the 
prudential regulators and the Federal Trade Commission[A]; 
Voluntary coordination? N/A. 

Rulemaking: Consumer Financial Civil Penalty Fund; 
Responsible 
regulator: CFPB; 
Published date: 5/7/2013; 
Effective date*: 5/7/2013; 
Coordination required? Unclear; 
Nature of coordination: Although unclear about the applicability of 
Dodd-Frank section 1022(b)(2), to inform the rulemaking more fully, 
CFPB consulted or offered to consult with the prudential regulators 
and the Federal Trade Commission[
Voluntary coordination? Unclear. 

Rulemaking: Amendments to the 2013 Escrows Final Rule under the Truth 
in Lending Act (Regulation Z); 
Responsible regulator: CFPB; 
Published date: 5/23/2013; 
Effective date*: 6/1/2013; 
Coordination required? Yes; 
Nature of coordination: CFPB consulted or offered to consult with the 
prudential regulators, the Department of Housing and Urban Development, 
the Federal Housing Finance Agency, the Federal Trade Commission, SEC, 
and Treasury[A]; 
Voluntary coordination? N/A. 

Rulemaking: Antidisruptive practices authority; 
Responsible regulator: CFTC; 
Published date: 5/28/2013; 
Effective date*: 5/28/2013; 
Coordination required? Yes; 
Nature of coordination: CFTC consulted with SEC[C]; 
Voluntary coordination? N/A. 

Rulemaking: Loan Originator Compensation Requirements Under the Truth 
in Lending Act (Regulation Z); Prohibition on Financing Credit 
Insurance Premiums; Delay of Effective Date; 
Responsible regulator: CFPB; 
Published date: 5/31/2013; 
Effective date*: 6/1/2013; 
Coordination required? Yes; 
Nature of coordination: CFPB consulted or offered to consult with the 
prudential regulators, the Department of Housing and Urban 
Development, the Federal Housing Finance Agency, the Federal Trade 
Commission, Treasury, and United States Department of Agriculture[A]; 
Voluntary coordination? N/A. 

Rulemaking: Definition of "Predominantly Engaged in Activities That 
Are Financial in Nature or Incidental Thereto"; 
Responsible regulator: FDIC; 
Published date: 6/10/2013; 
Effective date*: 7/10/2013; 
Coordination required? Yes; 
Nature of coordination: As required by the act, FDIC consulted with 
Treasury. FDIC also coordinated with the Federal Reserve; 
Voluntary coordination? Yes. 

Source: GAO analysis of Dodd-Frank Act, Federal Register, and other 
documents from regulators. 

Note: In this report, we use the terms "rules," "regulations," or 
"rulemakings" generally to refer to Federal Register notices of agency 
action pursuant to the Dodd-Frank Act, including regulations, 
interpretive rules, general statements of policy, guidance, and rules 
that deal with agency organization, procedure, or practice. Combined 
with our past two reports, we have reviewed all Dodd-Frank Act rules 
in effect as of July 22, 2013. See GAO, Dodd-Frank Act Regulations: 
Implementation Could Benefit from Additional Analyses and 
Coordination, GAO-12-151 (Washington, D.C.: Nov. 10, 2011), and Dodd-
Frank Act Regulations: Agencies' Efforts to Analyze and Coordinate 
Their Rules, GAO-13-101 (Washington, D.C.: Dec. 18, 2012). 

*To determine our scope for this review, we considered the earliest 
effective date shown in the final Federal Register releases for each 
Dodd-Frank rulemaking. If the effective date shown fell within our 
scope, the rule was included even if subsequent rulemakings changed 
the effective date of the rule. 

[A] Section 1022(b)(2)(B) of the Dodd-Frank Act requires CFPB, in 
prescribing a rule under the federal consumer financial laws, to 
consult with the appropriate prudential regulators or other federal 
agencies prior to proposing a rule and during the comment process 
regarding consistency with prudential, market, or systemic objectives 
administered by such agencies. Additionally, under section 1015 of the 
act, CFPB is required to coordinate with SEC, CFTC, the Federal Trade 
Commission, and other federal agencies and state regulators, as 
appropriate, to promote consistent regulatory treatment of consumer 
financial and investment products and services. 

[B] According to section 712(a)(2) of the act, SEC shall consult and 
coordinate to the extent possible with CFTC and the prudential 
regulators before commencing any rulemaking or issuing an order 
regarding security-based swaps, security-based swap dealers, major 
security-based swap participants, security-based swap data 
repositories, clearing agencies with regard to security-based swaps, 
persons associated with a security-based swap dealer or major security-
based swap participant, eligible contract participants with regard to 
security-based swaps, or security-based swap execution facilities, for 
the purposes of assuring regulatory consistency and comparability, to 
the extent possible. 

[C] According to section 712(a)(1), before commencing any rulemaking 
or issuing an order regarding swaps, swap dealers, major swap 
participants, swap data repositories, derivative clearing 
organizations with regard to swaps, persons associated with a swap 
dealer or major swap participant, eligible contract participants, or 
swap execution facilities pursuant to Subtitle A of Title 7 of Dodd-
Frank, CFTC shall consult and coordinate to the extent possible with 
SEC and the prudential regulators for the purposes of assuring 
regulatory consistency and comparability, to the extent possible. 

[D] According to section 752(a) of the act, in order to promote 
effective and consistent global regulation of swaps and security-based 
swaps, CFTC, SEC, and the prudential regulators, as appropriate, shall 
consult and coordinate with foreign regulatory authorities on the 
establishment of consistent international standards with respect to 
the regulation (including fees) of swaps, security-based swaps, swap 
entities, and security-based swap entities and may agree to such 
information-sharing arrangements as may be deemed to be necessary or 
appropriate in the public interest or for the protection of investors, 
swap counterparties, and security-based swap counterparties. 

[End of table] 

[End of section] 

Appendix V: Summary of Rulemakings Related to Selected Dodd-Frank 
Provisions Applicable to Systemically Important Financial Institutions: 

The Dodd-Frank Act contains several provisions that apply to nonbank 
financial companies designated by the Financial Stability Oversight 
Council for Federal Reserve supervision and enhanced prudential 
standards (nonbank SIFI) and bank holding companies with $50 billion 
or more in total consolidated assets (bank SIFI). Table 9 summarizes 
some of those provisions and the rulemakings, including their status, 
to implement those provisions. 

Table 9: Rulemakings Implementing Selected Dodd-Frank Provisions 
Applicable to Systemically Important Financial Institutions and Their 
Status as of November 29, 2013: 

Dodd-Frank Act provision: FSOC designation of Nonbank Financial 
Companies for Federal Reserve supervision--Section 113 authorizes FSOC 
to determine that a nonbank financial company shall be subject to 
enhanced prudential standards and supervision by the Federal Reserve if 
FSOC determines that (i) material financial distress or (ii) the 
nature, scope, size, scale, concentration, interconnectedness, or mix 
of activities at the nonbank financial company could pose a threat to 
the financial stability of the U.S. FSOC's final rule and 
interpretative guidance describe the manner in which FSOC intends to 
apply the statutory standards (related to a six category framework for 
size, interconnectedness, substitutability, leverage, and liquidity 
risk, and maturity mismatch), and the procedures FSOC intends to 
follow, when making a determination to designate a nonbank financial 
company for Federal Reserve supervision under section 113 of the act; 
Rulemaking status: FSOC final rule and interpretative guidance 77 Fed. 
Reg. 21,637 (Apr. 11, 2012). On July 8, 2013, FSOC voted to designate 2 
nonbank financial companies for Federal Reserve supervision. On 
September 19, 2013, FSOC voted to designate a third nonbank financial 
company for Federal Reserve supervision. 

Dodd-Frank Act provision: Enhanced supervision and prudential 
standards--Sections 165 and 166 require the Federal Reserve to impose 
enhanced prudential standards and early remediation requirements on 
bank holding companies, including foreign banking organizations with 
total consolidated assets of $50 billion or more that are treated as 
bank holding companies for purposes of the Bank Holding Company Act of 
1956, and nonbank financial companies designated by FSOC to prevent or 
mitigate risks to U.S. financial stability[A]. According to the 
Federal Reserve, the proposed standards for foreign banking 
organizations are broadly consistent with the standards proposed for 
large U.S. bank and nonbank SIFIs. The December 2012 proposal includes 
an additional requirement for certain foreign banking organizations to 
form a U.S. intermediate holding company, which would generally serve 
as a U.S. top-tier holding company for the U.S. subsidiaries of the 
company; 
Rulemaking status: Federal Reserve proposed rules for U.S. and foreign 
organizations operating in the U.S.: 77 Fed. Reg. 594 (Jan. 5, 2012) 
and 77 Fed. Reg. 76628 (Dec. 28, 2012), respectively[B]. 

Dodd-Frank Act provision: Enhanced risk-based capital and leverage 
requirements required under section 165(b)(1)(A)(i)--capital plans: 
Bank holding companies with $50 billion or more in total consolidated 
assets, certain intermediate holding companies of foreign banking 
organizations, and nonbank financial companies designated by FSOC would 
be subject to the Federal Reserve's capital plan rule, which requires 
such companies to submit an annual capital plan to the Board for review 
that, together with the proposed stress tests (below), would 
demonstrate to the Board that the company has robust, forward-looking 
capital planning processes that account for their unique risks and 
permit continued operations during times of stress[C]; 
Rulemaking status: proposal included in Jan. 5, 2012 rule and Dec. 28, 
2012 rule. 

Dodd-Frank Act provision: Enhanced risk-based capital and leverage 
requirements required under section 165(b)(1)(A)(i)--capital 
surcharges: The Federal Reserve intends to issue a proposal imposing a 
quantitative risk-based capital surcharge for all or a subgroup of bank 
holding companies with $50 billion or more in total consolidated 
assets, certain foreign banking organizations, and nonbank financial 
companies designated by FSOC based on the Basel capital surcharge for 
Globally Systemically Important Banks (G-SIB)[D]; 
Rulemaking status: intention to propose included in Jan. 5, 2012 rule 
and Dec. 28, 2012 rule. 

Dodd-Frank Act provision: Enhanced liquidity requirements required 
under section 165(b)(1)(A)(ii)--liquidity risk management standards: 
Bank holding companies with $50 billion or more in total consolidated 
assets, certain foreign banking organizations, and nonbank financial 
companies designated by FSOC would be subject to liquidity risk 
management standards that require those companies to, among other 
things, project cash flow needs over various time horizons, stress test 
the projections at least monthly, determine a liquidity buffer, and 
maintain a contingency funding plan that identifies potential sources 
of liquidity strain and alternative sources of funding; 
Rulemaking status: proposal included in Jan. 5, 2012 rule and Dec. 28, 
2012 rule. 

Dodd-Frank Act provision: Enhanced liquidity requirements required 
under Section 165(b)(1)(A)(ii)--Basel liquidity ratios: The banking 
agencies have proposed a liquidity coverage ratio requirement, 
consistent with the international liquidity standards published by the 
Basel Committee on Banking Supervision for large, internationally 
active banking organizations with more than $250 billion in assets, 
nonbank financial companies designated by FSOC for Federal Reserve 
supervision that do not have substantial insurance activities, and 
their consolidated subsidiary depository institutions; 
Rulemaking status: Federal Reserve, FDIC, and OCC proposed rule issued 
on October 24, 2013 (Federal Register release not yet available). 

Dodd-Frank Act provision: Credit exposure reports required under 
section 165(d)(2): Section 165 also requires the Federal Reserve to 
impose credit exposure reporting requirements on bank holding companies 
with $50 billion or more in total consolidated assets, certain foreign 
banking organizations, and nonbank financial companies designated by 
FSOC.The joint proposed rule would require those companies to report 
significant credit exposures to other covered companies and significant 
exposures that other covered companies have to that company; 
Rulemaking status: Federal Reserve and FDIC proposed rule 76 Fed. Reg. 
22,648 (Apr. 22, 2011). 

Dodd-Frank Act provision: Concentration limits required under section 
165(e): As required by the act, the Federal Reserve would prohibit bank 
holding companies with $50 billion or more in total consolidated 
assets, certain foreign banking organizations, and nonbank financial 
companies designated by FSOC from having credit exposure to any 
unaffiliated company that exceeds 25 percent of the company's capital 
stock and surplus. The Federal Reserve proposed a more stringent credit 
exposure limit of 10 percent between the largest, more complex 
financial institutions; 
Rulemaking status: proposal included in January 5, 2012 rule and Dec. 
28, 2012 rule. 

Dodd-Frank Act provision: Stress Tests required under section 165(i): 
Bank holding companies with $50 billion or more in total consolidated 
assets, certain foreign banking organizations, and nonbank financial 
companies designated by FSOC are required by the Act to conduct semi-
annual company-run stress tests, and the Federal Reserve is required to 
conduct an annual stress test on each of those companies.[E] The final 
rule builds on the stress tests required under the capital plans that 
large, complex bank holding companies submitted to the Federal Reserve 
for supervision under the Supervisory Capital Assessment Program in 
2009, the subsequent Comprehensive Capital and Analysis Review in 2011, 
and the capital plan rule effective Dec. 30, 2011; 
Rulemaking status: Federal Reserve final rule 77 Fed. Reg. 62,378 
(Oct. 12, 2012); for foreign banking organizations, proposal included 
in Dec. 28, 2012 rule. 

Dodd-Frank Act provision: Resolution plans required under section 
165(d)(1): Section 165 also requires the Federal Reserve to require 
resolution plans from bank holding companies with $50 billion or more 
in total consolidated assets, certain foreign banking organizations, 
and nonbank financial companies designated by FSOC.The joint final rule 
requires each plan to include, among other things, information about 
the company's ownership structure, core business lines, and critical 
operations, and a strategic analysis of how the SIFI can be resolved 
under the U.S. Bankruptcy Code in a way that would not pose systemic 
risk to the financial system; 
Rulemaking status: Federal Reserve and FDIC final rule 76 Fed. Reg. 
67,323 (Nov. 1, 2011). 

Dodd-Frank Act provision: Debt-to-Equity Limits under section 165(j): 
Section 165(j) provides that the Federal Reserve must require bank 
holding companies with $50 billion or more in total consolidated 
assets, certain foreign banking organizations, and nonbank financial 
companies designated by FSOC to maintain a debt-to-equity ratios of no 
more than 15-to-1, upon a determination by the Council that (i) such 
company poses a grave threat to the financial stability of the United 
States and (ii) the imposition of such a requirement is necessary to 
mitigate the risk that the company poses to U.S. financial stability; 
Rulemaking status: proposal included in Jan. 5, 2012 rule and Dec. 28, 
2012 rule. 

Dodd-Frank Act provision: Early remediation requirements under section 
166: Section 166 requires the Federal Reserve, in consultation with 
FSOC and FDIC, to prescribe regulations to provide for the early 
remediation of financial distress of bank holding companies with $50 
billion or more in total consolidated assets, certain foreign banking 
organizations, and nonbank financial companies designated by FSOC. The 
proposed requirements would include a number of triggers for 
remediation, including capital levels, stress test results, and risk 
management weaknesses. In certain situations, the Federal Reserve would 
impose restrictions on growth, assets, acquisitions, capital 
distributions and executive compensation, and other activities that the 
Federal Reserve deems appropriate; 
Rulemaking status: proposal included in Jan. 5, 2012 rule and Dec. 28, 
2012 rule. 

Dodd-Frank Act provision: FDIC Orderly Liquidation Authority--Title II 
gives the FDIC new orderly liquidation authority to act as a receiver 
of a troubled nonbank financial companies designated by FSOC. The FDIC 
has issued and expects to issue a number of rules to exercise this new 
authority. The FDIC indicated that the July 15, 2011 rule represents 
the culmination of the initial phase of such rulemaking; 
Rulemaking status: FDIC final rule 76 Fed. Reg. 41,626 (July 15, 2011). 

Dodd-Frank Act provision: Federal Reserve authority to impose 
mitigatory actions on certain nonbank financial companies determined to 
pose a grave threat to financial stability--Section 121(a) allows the 
Federal Reserve, with a two-thirds vote by FSOC, to impose certain 
additional restrictions on bank holding companies with $50 billion or 
more in total consolidated assets and nonbank financial companies 
designated by FSOC determined to pose a grave threat to the financial 
stability of the United States, including limiting mergers and 
acquisitions, requiring the company to terminate activities, or 
requiring the company to sell or transfer assets or off-balance-sheet 
items to unaffiliated entities; 
Rulemaking status: No rules issued. 

Dodd-Frank Act provision: Collins Amendment--Section 171(b) requires 
the appropriate federal banking agencies to establish permanent minimum 
risk-based capital and leverage floors on insured depository 
institutions, depository institution holding companies, and nonbank 
financial companies designated by FSOC. Under the final rule, these 
institutions must calculate their floors using the minimum risk-based 
capital and leverage requirements under the prompt corrective action 
framework implementing section 38 of the Federal Deposit Insurance 
Act; 
Rulemaking status: Federal Reserve, FDIC, and OCC final rule; 76 
Fed. Reg. 37,620 (June 28, 2011). 

Dodd-Frank Act provision: Concentration Limit/liability cap on large 
financial institutions--Section 622 establishes, subject to 
recommendations by FSOC, a financial sector concentration limit that 
generally prohibits a financial company from merging or consolidating 
with, acquiring all or substantially all of the assets of, or otherwise 
acquiring control of, another company if the resulting company's 
consolidated liabilities would exceed 10 percent of the aggregate 
consolidated liabilities of all financial companies; 
Rulemaking status: No rules issued. 

Source: Dodd-Frank Act, Federal Register, and other documents from 
regulators and FSOC. 

[A] Section 165 also directs the Federal Reserve to impose enhanced 
prudential standards for bank holding companies with $50 billion or 
more in total consolidated assets, certain foreign banking 
organizations, and nonbank financial companies designated by FSOC 
regarding overall risk management, which were also proposed in the 
January 5, 2012 rule. Additionally, section 165 also authorizes FSOC to 
recommend additional enhanced prudential standards for bank holding 
companies with $50 billion or more in total consolidated assets, 
certain foreign banking organizations, and nonbank financial companies 
designated by FSOC to the Federal Reserve. 

[B] In this January 5, 2012 proposed rule, the Federal Reserve proposed 
rules to implement certain but not all of the requirements of sections 
165 and 166 of the Dodd-Frank Act and stated its intention to propose 
others. 

[C] Bank SIFIs are already required to comply with the capital plan 
rule. The Federal Reserve issued its final capital plans rule on 
December 1, 2011 (see 76 Fed. Reg. 74,631). 

[D] In November 2011, the Financial Stability Board identified 29 G-
SIBs and indicated it would update this list annually each November. 
FSB last updated this list on November 11, 2013. The updated list 
contains 29 G-SIBs; the same eight U.S, bank SIFIs were designated as 
G-SIBs in 2011, 2012, and 2013. 

[E] Section 165(i)(2) of the Act requires that any bank holding company 
with more than $10 billion in total consolidated assets and that is 
regulated by a federal financial regulatory agency also be subject to 
company-run stress tests. The Federal Reserve issued a separate rule to 
implement this requirement. 77 Fed. Reg. 62,396 (Oct. 12, 2012). 

[End of table] 

[End of section] 

Appendix VI: Trends in GAO Indicators for Bank SIFIs: 

As we reported last year, some Dodd-Frank Act provisions and related 
rules may result in adjustments to the size, interconnectedness, 
complexity, leverage, or liquidity of systemically important financial 
institutions (SIFI) over time.[Footnote 129] We developed indicators 
to monitor changes in some of these SIFI characteristics. The size and 
complexity indicators reflect the potential for a single company's 
financial distress to affect the financial system and economy. The 
leverage and liquidity indicators reflect a SIFI's resilience to 
shocks or its vulnerability to financial distress. Like we did in our 
last report, we continue to focus our analysis on bank SIFIs, given 
that FSOC only recently designated three nonbank financial firms for 
Federal Reserve supervision.[Footnote 130] Our indicators have 
limitations. For example, the indicators do not identify causal links 
between changes in SIFI characteristics and the act. Rather, the 
indicators track changes in the size, complexity, leverage, and 
liquidity of SIFIs over the period since the Dodd-Frank Act was passed 
to examine whether the changes are consistent with the act. However, 
other factors--including the economic downturn, international banking 
standards agreed upon by the Basel Committee on Banking Supervision 
(Basel Committee), European debt crisis, and monetary policy actions--
also affect bank holding companies and, thus, the indicators.[Footnote 
131] These factors may have a greater effect than the Dodd-Frank Act 
on SIFIs. As discussed, some rules implementing SIFI-related 
provisions have not yet been finalized. Thus, trends in our indicators 
include the effects of these rules only insofar as SIFIs have changed 
their behavior in response to issued rules and in anticipation of 
expected rules. In this sense, our indicators provide baselines 
against which to compare future trends. 

SIFI Size: 

We developed three indicators of size. The first indicator tracks the 
number of U.S. bank SIFIs. The second indicator measures a SIFI's size 
based on the total assets on its balance sheet. The third indicator 
measures the extent to which industry assets are concentrated among 
the individual SIFIs, reflecting a SIFI's size relative to the size of 
the industry. A limitation of these indicators is that they do not 
include an institution's off-balance sheet activities and thus may 
understate the amount of financial services or intermediation an 
institution provides. Furthermore, asset size alone is not an accurate 
determinant of systemic risk, as an institution's systemic risk 
significance also depends on other factors, such as its complexity and 
interconnectedness. 

As shown in figure 6, there were 33 bank SIFIs (i.e., bank holding 
companies with $50 billion or more in total consolidated assets) in 
the second quarter of 2013. The figure also shows that six of the bank 
SIFIs had more than $500 billion in total consolidated assets 
(referred to as large bank SIFIs in this report) and were considerably 
larger than the other bank SIFIs. 

Figure 6: 2013 U.S. Bank SIFIs' Total Assets, as of Second Quarter 
2013: 

[Refer to PDF for image: horizontal bar graph] 

2013 Q2 dollars in billions: 

Asset ranking: 1; 
2010 assets (3rd quarter): $2,439.5; 
2012 assets (2nd quarter): $2,321.7; 
2013 assets (2nd quarter): $2,242.1. 

Asset ranking: 2; 
2010 assets (3rd quarter): $2,125.7; 
2012 assets (2nd quarter): $2,191.8; 
2013 assets (2nd quarter): $2,451. 

Asset ranking: 3; 
2010 assets (3rd quarter): $1,884; 
2012 assets (2nd quarter): $1,942.8; 
2013 assets (2nd quarter): $2,076.4. 

Asset ranking: 4; 
2010 assets (3rd quarter): $1,440.6; 
2012 assets (2nd quarter): $1,354.6; 
2013 assets (2nd quarter): $1,278.1. 

Asset ranking: 5; 
2010 assets (3rd quarter): $938.6; 
2012 assets (2nd quarter): $962; 
2013 assets (2nd quarter): $951.5. 

Asset ranking: 6; 
2010 assets (3rd quarter): $802.7; 
2012 assets (2nd quarter): $758.8; 
2013 assets (2nd quarter): $880.9. 

Asset ranking: 7; 
2010 assets (3rd quarter): $360.5; 
2012 assets (2nd quarter): $335; 
2013 assets (2nd quarter): $266.2. 

Asset ranking: 8; 
2010 assets (3rd quarter): $353.4; 
2012 assets (2nd quarter): $358; 
2013 assets (2nd quarter): $304.3. 

Asset ranking: 9; 
2010 assets (3rd quarter): $322; 
2012 assets (2nd quarter): $321.8; 
2013 assets (2nd quarter): $366.5. 

Asset ranking: 10; 
2010 assets (3rd quarter): $304.5; 
2012 assets (2nd quarter): $303.8; 
2013 assets (2nd quarter): $272.4. 

Asset ranking: 11; 
2010 assets (3rd quarter): $296.7; 
2012 assets (2nd quarter): $300.8; 
2013 assets (2nd quarter): $206.2. 

Asset ranking: 12; 
2010 assets (3rd quarter): $228.9; 
2012 assets (2nd quarter): $210.2; 
2013 assets (2nd quarter): $183.2. 

Asset ranking: 13; 
2010 assets (3rd quarter): $227; 
2012 assets (2nd quarter): $203.1; 
2013 assets (2nd quarter): $179.5. 

Asset ranking: 14; 
2010 assets (3rd quarter): $182.7; 
2012 assets (2nd quarter): $181; 
2013 assets (2nd quarter): $164.6. 

Asset ranking: 15; 
2010 assets (3rd quarter): $171.6; 
2012 assets (2nd quarter): $180.8; 
2013 assets (2nd quarter): $182.9. 

Asset ranking: 16; 
2010 assets (3rd quarter): $152; 
2012 assets (2nd quarter): $150.4; 
2013 assets (2nd quarter): $151.8. 

Asset ranking: 17; 
2010 assets (3rd quarter): $150.6; 
2012 assets (2nd quarter): $181; 
2013 assets (2nd quarter): $181.3. 

Asset ranking: 18; 
2010 assets (3rd quarter): $123.4; 
2012 assets (2nd quarter): $119.2; 
2013 assets (2nd quarter): $117.6. 

Asset ranking: 19; 
2010 assets (3rd quarter): $118.8; 
2012 assets (2nd quarter): $124; 
2013 assets (2nd quarter): $139.8. 

Asset ranking: 20; 
2010 assets (3rd quarter): $118.1; 
2012 assets (2nd quarter): $131.1; 
2013 assets (2nd quarter): $142.5. 

Asset ranking: 21; 
2010 assets (3rd quarter): $112.3; 
2012 assets (2nd quarter): $113.7; 
2013 assets (2nd quarter): $74. 

Asset ranking: 22; 
2010 assets (3rd quarter): $102.3; 
2012 assets (2nd quarter): $89.1; 
2013 assets (2nd quarter): $83.6. 

Asset ranking: 23; 
2010 assets (3rd quarter): $97.2; 
2012 assets (2nd quarter): $95.8; 
2013 assets (2nd quarter): $84.5. 

Asset ranking: 24; 
2010 assets (3rd quarter): $90.9; 
2012 assets (2nd quarter): $87.9; 
2013 assets (2nd quarter): $98.5. 

Asset ranking: 25; 
2010 assets (3rd quarter): $83.2; 
2012 assets (2nd quarter): $81.9; 
2013 assets (2nd quarter): $71.4. 

Asset ranking: 26; 
2010 assets (3rd quarter): $80.1; 
2012 assets (2nd quarter): $79.7; 
2013 assets (2nd quarter): $76.2. 

Asset ranking: 27; 
2012 assets (2nd quarter): $79.2; 
2013 assets (2nd quarter): $84.1. 

Asset ranking: 28; 
2010 assets (3rd quarter): $74.9; 
2012 assets (2nd quarter): $74.3; 
2013 assets (2nd quarter): $64.5. 

Asset ranking: 29; 
2012 assets (2nd quarter): $72; 
2013 assets (2nd quarter): $65.9. 

Asset ranking: 30; 
2010 assets (3rd quarter): $69.7; 
2012 assets (2nd quarter): $66.9; 
2013 assets (2nd quarter): $67.3. 

Asset ranking: 31; 
2010 assets (3rd quarter): $63; 
2012 assets (2nd quarter): $63.6; 
2013 assets (2nd quarter): $57.7. 

Asset ranking: 32; 
2010 assets (3rd quarter): $56.1; 
2012 assets (2nd quarter): $57.4; 
2013 assets (2nd quarter): $55.7. 

Asset ranking: 33; 
2010 assets (3rd quarter): $54.9; 
2012 assets (2nd quarter): $54.2; 
2013 assets (2nd quarter): $53.4. 

$50 billion asset threshold for bank holding company enhanced 
prudential oversight and regulation. 

Source: GAO analysis of data from the Federal Reserve Bank of Chicago 
and the Bureau of Economic Analysis. 

Note: Bank SIFIs are bank holding companies with $50 billion or more 
in total consolidated assets. Bank SIFIs are ranked by assets as of 
the second quarter of 2013, with 1 being the bank SIFI with the most 
amount of assets and 33 being the bank SIFI with the least amount of 
assets. 

[End of figure] 

Our indicators show that the number and size of U.S. bank SIFIs 
declined from the third quarter of 2010 through the second quarter of 
2013, and several SIFIs continue to dominate and have increased their 
dominance of the market. 

* Table 10 shows that the total number of U.S. bank SIFIs decreased by 
three over the period: (1) the number of large bank SIFIs decreased by 
one and (2) the number of other bank SIFIs decreased by two. In our 
November 2012 report, we noted that there were seven large SIFIs as of 
the second quarter of 2012. Six of them continue to be large bank 
SIFIs as of the third quarter of 2013. In February 2013, the remaining 
one received regulatory approval to deregister as a bank holding 
company. 

* Table 10 also shows that the median assets for U.S. bank SIFIs 
declined by about $21.5 billion (about 12 percent) over the period. 
However, median assets for large bank SIFIs increased from $1,278.1 
billion to $1,662.3 billion, or by $384.2 (about 30 percent), in part 
because one of the large bank SIFIs deregistered as a bank holding 
company in 2013. Median assets for the other bank SIFIs decreased from 
$139.8 billion to $118.8 billion, or by $21 billion (about 15 percent). 

Table 10: Number and Median Size of U.S. Bank Holding Companies and 
Bank SIFIs as of Third Quarter 2010, Second Quarter 2012, and Second 
Quarter 2013 (Assets in Billions of Constant 2013 Q2 Dollars): 

Total bank holding companies: 

2010 Q3: 
Number: 1,018; 
Median assets: $1.0; 
2012 Q2: 
Number: 1,028; 
Median assets: $1.0; 
2013 Q2: 
Number: 1,035; 
Median assets: $0.9. 

Total SIFIs: 

2010 Q3: 
Number: 36; 
Median assets: $172.1; 
2012 Q2: 
Number: 34; 
Median assets: $165.6; 
2013 Q2: 
Number: 33; 
Median assets: $150.6. 

Large SIFIs: 

Number; 
2010 Q3: 
Number: 7; 
Median assets: $1,278.1; 
2012 Q2: 
Number: 7; 
Median assets: $1,354.6; 
2013 Q2: 
Number: 6; 
Median assets: $1,662.3. 

Other SIFIs: 

Number; 
2010 Q3: 
Number: 29; 
Median assets: $139.8; 
2012 Q2: 
Number: 27; 
Median assets: $119.2; 
2013 Q2: 
Number: 27; 
Median assets: $118.8. 

Non-SIFIs: 

Number; 
2010 Q3: 
Number: 982; 
Median assets: $1.0; 
2012 Q2: 
Number: 994; 
Median assets: $0.9; 
2013 Q2: 
Number: 1,002; 
Median assets: $0.9. 

Source: GAO analysis of data from the Federal Reserve Bank of Chicago 
and the Bureau of Economic Analysis. 

Note: Median assets are adjusted for inflation and are measured in 
billions of constant 2013 Q2 dollars. We used data on top-tier bank 
holding companies that filed form FR Y-9C, which is generally filed by 
top-tier bank holding companies with assets of $500 million or more, 
although a small number of bank holding companies with assets below 
that threshold also filed form FR Y-9C. We define large bank SIFIs as 
those with assets of $500 billion or more. Other bank SIFIs are those 
with assets between $50 billion and $500 billion. Non-SIFI bank 
holding companies are those with assets less than $50 billion. 

[End of table] 

* Figure 7 shows that the median market share for large bank SIFIs 
increased from 7.4 percent to 10.3 percent (or by about 40 percent) of 
the industry's assets from the third quarter of 2010 through the 
second quarter of 2013. In contrast, the median market share for the 
other bank SIFIs declined from 0.8 percent to 0.7 percent (or by about 
9 percent) over the same period. 

Figure 7: Median Market Share for U.S. Bank Holding Companies by Size, 
from First Quarter 2006 through Second Quarter 2013: 

[Refer to PDF for image: multiple line graph] 

Large bank SIFIs: more than or equal to $500 billion in assets; 
Other bank SIFIs: more than or equal to $50 billion, but less than 
$500 billion in assets; 
Non-SIFI banks: more than or equal to 50 million, but less than $50 
billion in assets. 

Year and quarter: 2006, Q1; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.9%; 
Large bank SIFIS: 11.7%. 

Year and quarter: 2006, Q2; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.8%; 
Large bank SIFIS: 11.4%. 

Year and quarter: 2006, Q3; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.9%; 
Large bank SIFIS: 11.2%. 

Year and quarter: 2006, Q4; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.9%; 
Large bank SIFIS: 11.0%. 

Year and quarter: 2007, Q1; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.9%; 
Large bank SIFIS: 8.3%. 

Year and quarter: 2007, Q2; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 1.0%; 
Large bank SIFIS: 5.5%. 

Year and quarter: 2007, Q3; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.7%; 
Large bank SIFIS: 5.0%. 

Year and quarter: 2007, Q4; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.8%; 
Large bank SIFIS: 5.8%. 

Year and quarter: 2008, Q1; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.8%; 
Large bank SIFIS: 5.8%. 

Year and quarter: 2008, Q2; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.9%; 
Large bank SIFIS: 5.9%. 

Year and quarter: 2008, Q3; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.8%; 
Large bank SIFIS: 4.9%. 

Year and quarter: 2008, Q4; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.9%; 
Large bank SIFIS: 13.1%. 

Year and quarter: 2009, Q1; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.8%; 
Large bank SIFIS: 9.9%. 

Year and quarter: 2009, Q2; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.8%; 
Large bank SIFIS: 8.1%. 

Year and quarter: 2009, Q3; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.8%; 
Large bank SIFIS: 7.7%. 

Year and quarter: 2009, Q4; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.8%; 
Large bank SIFIS: 7.8%. 

Year and quarter: 2010, Q1; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.8%; 
Large bank SIFIS: 7.5%. 

Year and quarter: 2010, Q2; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.8%; 
Large bank SIFIS: 7.6%. 

Year and quarter: 2010, Q3; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.8%; 
Large bank SIFIS: 7.4%. 

Year and quarter: 2010, Q4; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.7%; 
Large bank SIFIS: 7.8%. 

Year and quarter: 2011, Q1; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.7%; 
Large bank SIFIS: 7.6%. 

Year and quarter: 2011, Q2; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.8%; 
Large bank SIFIS: 7.6%. 

Year and quarter: 2011, Q3; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.8%; 
Large bank SIFIS: 7.8%. 

Year and quarter: 2011, Q4; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.8%; 
Large bank SIFIS: 8.0%. 

Year and quarter: 2012, Q1; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.7%; 
Large bank SIFIS: 8.0%. 

Year and quarter: 2012, Q2; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.7%; 
Large bank SIFIS: 8.1%. 

Year and quarter: 2012, Q3; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.7%; 
Large bank SIFIS: 8.2%. 

Year and quarter: 2012, Q4; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.8%; 
Large bank SIFIS: 10.2%. 

Year and quarter: 2013, Q1; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.8%; 
Large bank SIFIS: 10.3%. 

Year and quarter: 2013, Q2; 
NonSIFIs banks: 0.01%; 
Other bank SIFIs: 0.7%; 
Large bank SIFIS: 10.3%. 

Source: GAO analysis of data from the Federal Reserve Bank of Chicago. 

Note: To calculate the median market shares, we calculated the market 
share for each bank holding company, and then reported the median 
market share for large bank SIFIs, the median for other bank SIFIs, 
and the median for non-SIFI banks. We used data on top-tier bank 
holding companies that filed form FR Y-9C, which is generally filed by 
top-tier bank holding companies with assets of $500 million or more, 
although a small number of bank holding companies with assets below 
that threshold also filed form FR Y-9C. We define large bank SIFIs as 
those with assets of $500 billion or more. Other bank SIFIs are those 
with assets between $50 billion and $500 billion. Non-SIFI bank 
holding companies are those with assets less than $50 billion. 

[End of figure] 

Complexity of SIFIs: 

Our indicators of complexity are the number of legal entities of bank 
SIFIs, the percentage of foreign legal entities of large SIFIs, and 
the number of countries where they are located. An institution's 
operational complexity may reflect an institution's diverse lines of 
business and locations in which the institution operates, which are 
reflected partly through its various legal structures. Consequently, a 
SIFI with a large number of legal entities--particularly foreign ones 
operating in different countries under different regulatory regimes--
may be more difficult to resolve than a SIFI with fewer legal entities 
in fewer countries. One limitation of our indicator is that it does 
not provide information on the relative complexity of SIFIs resulting 
directly from their various lines of business. Additionally, changes 
in the operational complexity of a SIFI may be reflected in our 
indicators only insofar as they result in a change in the number of 
legal entities. 

The complexity indicators continue to show that most large bank SIFIs 
have a relatively large number of legal entities compared with other 
U.S. bank SIFIs and that they operate in various countries. They also 
show that some of the large bank SIFIs may be becoming less but others 
more complex: 

* Figure 8 shows that the six large bank SIFIs in the second quarter 
of 2013 continue to have more than 2,300 legal entities, with two of 
them having more than 7,000 and 10,000, respectively.[Footnote 132] 
Five of the large SIFIs had fewer legal entities at the end of the 
second quarter of 2013 than they had at the end of the second quarter 
of 2010. The median number of legal entities for the large bank SIFIs 
decreased from 4,991 to 3,682 from the second quarters 2010 to the 
second quarter of 2013. The median for the remaining 27 bank SIFIs 
also declined from 108 to 107 over the same period. Within this group, 
21 of the 27 bank holding companies had less than 200 legal entities 
over the period. 

Figure 8: 2013 U.S. Bank SIFIs' Total Legal Entities, as of June 30, 
2010, June 30, 2012, and June 30, 2013: 

[Refer to PDF for image: horizontal bar graph] 

Number of legal entities: 

June 30, 2010 median for large SIFIs = 4,991; 
June 30, 2012 median for large SIFIs = 4,382; 
June 30, 2013 median for large SIFIs = 3,682. 
June 30, 2013 median for other SIFIs = 107. 

Asset ranking: 1; 
2010 entities: 4,090; 
2012 entities: 4,149; 
2013 entities: 5,028; 

Asset ranking: 2; 
2010 entities: 2,785; 
2012 entities: 2,601; 
2013 entities: 3,641; 

Asset ranking: 3; 
2010 entities: 2,303; 
2012 entities: 2,319; 
2013 entities: 2,438; 

Asset ranking: 4; 
2010 entities: 3,274; 
2012 entities: 4,615; 
2013 entities: 4,953; 

Asset ranking: 5; 
2010 entities: 10,494; 
2012 entities: 11,361; 
2013 entities: 9,482; 

Asset ranking: 6; 
2010 entities: 7,030; 
2012 entities: 7,764; 
2013 entities: 8,346; 

Asset ranking: 7; 
2010 entities: 1,145; 
2012 entities: 898; 
2013 entities: 681; 

Asset ranking: 8; 
2010 entities: 105; 
2012 entities: 111; 
2013 entities: 126; 

Asset ranking: 9; 
2010 entities: 149; 
2012 entities: 167; 
2013 entities: 204; 

Asset ranking: 10; 
2010 entities: 664; 
2012 entities: 606; 
2013 entities: 659; 

Asset ranking: 11; 
2010 entities: 125; 
2012 entities: 144; 
2013 entities: 146; 

Asset ranking: 12; 
2010 entities: 75; 
2012 entities: 81; 
2013 entities: 59; 

Asset ranking: 13; 
2010 entities: 315; 
2012 entities: 323; 
2013 entities: 327; 

Asset ranking: 14; 
2010 entities: 120; 
2012 entities: 148; 
2013 entities: 146; 

Asset ranking: 15; 
2010 entities: 79; 
2012 entities: 97; 
2013 entities: 108; 

Asset ranking: 16; 
2010 entities: 454; 
2012 entities: 464; 
2013 entities: 550; 

Asset ranking: 17; 
2010 entities: 190; 
2012 entities: 255; 
2013 entities: 282; 

Asset ranking: 18; 
2010 entities: 831; 
2012 entities: 776; 
2013 entities: 635; 

Asset ranking: 19; 
2010 entities: 38; 
2012 entities: 41; 
2013 entities: 68; 

Asset ranking: 20; 
2010 entities: 55; 
2012 entities: 60; 
2013 entities: 59; 

Asset ranking: 21; 
2010 entities: 52; 
2012 entities: 65; 
2013 entities: 50; 

Asset ranking: 22; 
2010 entities: 183; 
2012 entities: 149; 
2013 entities: 99; 

Asset ranking: 23; 
2010 entities: 140; 
2012 entities: 140; 
2013 entities: 145; 

Asset ranking: 24; 
2010 entities: 200; 
2012 entities: 195; 
2013 entities: 251; 

Asset ranking: 25; 
2010 entities: 88; 
2012 entities: 93; 
2013 entities: 41; 

Asset ranking: 26; 
2010 entities: 25; 
2012 entities: 26; 
2013 entities: 30; 

Asset ranking: 27; 
2010 entities: 69; 
2012 entities: 67; 
2013 entities: 56; 

Asset ranking: 28; 
2010 entities: 36; 
2012 entities: 31; 
2013 entities: 22; 

Asset ranking: 29; 
2010 entities: 128; 
2012 entities: 112; 
2013 entities: 107; 

Asset ranking: 30; 
2010 entities: 45; 
2012 entities: 48; 
2013 entities: 50; 

Asset ranking: 31; 
2010 entities: 73; 
2012 entities: 75; 
2013 entities: 72; 

Asset ranking: 32; 
2010 entities: 107; 
2012 entities: 112; 
2013 entities: 110; 

Asset ranking: 33; 
2010 entities: 67; 
2012 entities: 73; 
2013 entities: 74. 

Source: GAO analysis of Federal Reserve Board data from the National 
Information Center. 

Note: Bank SIFIs are ranked by assets as of the second quarter of 
2013, with 1 being the bank SIFI with the most assets and 33 being the 
bank SIFI with the least assets. 

[End of figure] 

* Table 11 shows that five of the six large U.S. bank SIFIs in the 
second quarter of 2013 continue to have a high number or percentage of 
foreign legal entities, and some may be becoming less complex but 
others more complex based on these indicators. Four large bank SIFIs 
decreased their number or percentage of legal entities located outside 
of the United States from the second quarter of 2010 to the second 
quarter of 2013. Additionally, for these large SIFIs, the number of 
countries where their foreign legal entities operate decreased or 
remained stable over the period. In contrast, two large bank SIFIs 
increased both their number and percentage of legal entities located 
outside of the United States over the period, and for one of them the 
number of countries where its foreign entities operated increased by 
50 percent. 

Table 11: 2013 Large Bank SIFIs' Foreign Legal Entities, as of June 
30, 2010, June 30, 2012, and June 30, 2013: 

Bank SIFI ranking: Bank SIFI 1; 
Total number of legal entities, as of June 30th: 
2013: 4,093; 
2012: 4,159; 
2010: 5,099; 
Number and percentage of foreign legal entities, as of June 30th: 
2013: 798 (19%); 
2012: 808; (19%); 
2010: 1,104; (22%); 
Number of countries where foreign entities are located, as of June 
30th: 
2013: 49; 
2012: 51; 
2010: 49. 

Bank SIFI ranking: Bank SIFI 2; 
Total number of legal entities, as of June 30th: 
2013: 2,750; 
2012: 2,604; 
2010: 3,643; 
Number and percentage of foreign legal entities, as of June 30th: 
2013: 1,147; (42%); 
2012: 669; (26%); 
2010: 1,014; (28%); 
Number of countries where foreign entities are located, as of June 
30th: 
2013: 48; 
2012: 47; 
2010: 55. 

Bank SIFI ranking: Bank SIFI 3; 
Total number of legal entities, as of June 30th: 
2013: 2,136; 
2012: 2,324; 
2010: 2,449; 
Number and percentage of foreign legal entities, as of June 30th: 
2013: 1,263; (59%); 
2012: 1,237; (53%); 
2010: 1,360; (56%); 
Number of countries where foreign entities are located, as of June 
30th: 
2013: 79; 
2012: 82; 
2010: 83. 

Bank SIFI ranking: Bank SIFI 4; 
Total number of legal entities, as of June 30th: 
2013: 3,285; 
2012: 4,621; 
2010: 4,965; 
Number and percentage of foreign legal entities, as of June 30th: 
2013: 187; (6%); 
2012: 207; (4%); 
2010: 254; (5%); 
Number of countries where foreign entities are located, as of June 
30th: 
2013: 21; 
2012: 23; 
2010: 20. 

Bank SIFI ranking: Bank SIFI 5; 
Total number of legal entities, as of June 30th: 
2013: 10,635; 
2012: 11,621; 
2010: 9,737; 
Number and percentage of foreign legal entities, as of June 30th: 
2013: 6,041; (57%); 
2012: 5,986; (52%); 
2010: 4,244; (44%); 
Number of countries where foreign entities are located, as of June 
30th: 
2013: 63; 
2012: 61; 
2010: 42. 

Bank SIFI ranking: Bank SIFI 6; 
Total number of legal entities, as of June 30th: 
2013: 7,010; 
2012: 7,764; 
2010: 8,425; 
Number and percentage of foreign legal entities, as of June 30th: 
2013: 3,835; (55%); 
2012: 4,177; (54%); 
2010: 4,718; (56%); 
Number of countries where foreign entities are located, as of 
June 30th: 
2013: 54; 
2012: 55; 
2010: 59. 

Source: GAO analysis of National Information Center data maintained by 
the Federal Reserve. 

[End of table] 

Source: GAO analysis of National Information Center data maintained by 
the Federal Reserve. 

Note: Foreign entities are entities located outside of the 48 U.S. 
contiguous states, Alaska, and Hawaii. Large bank SIFIs are those with 
assets of $500 billion or more. Bank SIFIs are ranked by assets as of 
the second quarter of 2013, with 1 being the bank SIFI with the most 
assets. 

SIFI Leverage: 

Although there are many ways to measure leverage, we use two measures: 
(1) tangible common equity as a percentage of total assets, and (2) 
tangible common equity as a percentage of risk-weighted assets. The 
two indicators differ, in part because total risk-weighted assets 
reflect some of an institution's off-balance sheet activity but total 
assets do not. We focus on tangible common equity, because it most 
closely approximates the amount of capital available to absorb losses 
in asset values in the short term. A limitation of both indicators is 
that they may not fully reflect an institution's exposure to risk. 
Total assets do not reflect an institution's risk exposure from off-
balance sheet activities and generally treat all assets as equally 
risky. The calculation of risk-weighted assets is designed to reflect 
differences in risk, but the weights assigned to the assets may not 
fully reflect the risk exposure associated with those assets, for 
example, because assets in broad categories of loans all receive the 
same risk weight. 

Our indicators suggest that large and other bank SIFIs have decreased 
their leverage since the third quarter of 2010, but have slightly 
decreased or not changed their leverage levels over the past year. 

* Figure 9 shows that median tangible common equity as a percentage of 
total assets generally continued its upward trend for large and other 
bank SIFIs from the third quarter of 2010 through the second quarter 
of 2013. For large bank SIFIs, the indicator increased from 6.3 
percent to 6.8 percent (or by about 8 percent). For the other bank 
SIFIs, the indicator increased from 6.8 percent to 8.2 percent (or by 
about 21 percent). 

Figure 9: Median Tangible Common Equity as a Percentage of Total 
Assets for Bank Holding Companies by Size, from First Quarter 2006 
through Second Quarter 2013: 

[Refer to PDF for image: multiple line graph] 

Large bank SIFIs: more than or equal to $500 billion in assets; 
Other bank SIFIs: more than or equal to $50 billion, but less than 
$500 billion in assets; 
Non-SIFI banks: more than or equal to 50 million, but less than $50 
billion in assets. 

Quarter and year: 2006, Q1; 
NonSIFIs banks:	7.3%; 
Other bank SIFIs: 5.2%; 
Large bank SIFIS: 4.4%. 

Quarter and year: 2006, Q2; 
NonSIFIs banks:	7.2%; 
Other bank SIFIs: 5.1%; 
Large bank SIFIS: 4.3%. 

Quarter and year: 2006, Q3; 
NonSIFIs banks:	7.4%; 
Other bank SIFIs: 5.7%; 
Large bank SIFIS: 4.6%. 

Quarter and year: 2006, Q4; 
NonSIFIs banks:	7.4%; 
Other bank SIFIs: 5.5%; 
Large bank SIFIS: 4.2%. 

Quarter and year: 2007, Q1; 
NonSIFIs banks:	7.4%; 
Other bank SIFIs: 5.5%; 
Large bank SIFIS: 4.0%. 

Quarter and year: 2007, Q2; 
NonSIFIs banks:	7.2%; 
Other bank SIFIs: 5.2%; 
Large bank SIFIS: 4.0%. 

Quarter and year: 2007, Q3; 
NonSIFIs banks:	7.3%; 
Other bank SIFIs: 5.4%; 
Large bank SIFIS: 4.0%. 

Quarter and year: 2007, Q4; 
NonSIFIs banks:	7.3%; 
Other bank SIFIs: 5.1%; 
Large bank SIFIS: 3.7%. 

Quarter and year: 2008, Q1; 
NonSIFIs banks:	7.3%; 
Other bank SIFIs: 5.0%; 
Large bank SIFIS: 3.3%. 

Quarter and year: 2008, Q2; 
NonSIFIs banks:	7.0%; 
Other bank SIFIs: 5.1%; 
Large bank SIFIS: 3.2%. 

Quarter and year: 2008, Q3; 
NonSIFIs banks:	6.9%; 
Other bank SIFIs: 5.1%; 
Large bank SIFIS: 2.6%. 

Quarter and year: 2008, Q4; 
NonSIFIs banks:	6.7%; 
Other bank SIFIs: 4.4%; 
Large bank SIFIS: 2.7%. 

Quarter and year: 2009, Q1; 
NonSIFIs banks:	6.7%; 
Other bank SIFIs: 4.8%; 
Large bank SIFIS: 3.4%. 

Quarter and year: 2009, Q2; 
NonSIFIs banks:	6.7%; 
Other bank SIFIs: 5.7%; 
Large bank SIFIS: 3.8%. 

Quarter and year: 2009, Q3; 
NonSIFIs banks:	6.8%; 
Other bank SIFIs: 6.0%; 
Large bank SIFIS: 4.9%. 

Quarter and year: 2009, Q4; 
NonSIFIs banks:	6.7%; 
Other bank SIFIs: 5.9%; 
Large bank SIFIS: 5.1%. 

Quarter and year: 2010, Q1; 
NonSIFIs banks:	7.0%; 
Other bank SIFIs: 6.0%; 
Large bank SIFIS: 4.9%. 

Quarter and year: 2010, Q2; 
NonSIFIs banks:	7.2%; 
Other bank SIFIs: 6.7%; 
Large bank SIFIS: 5.5%. 

Quarter and year: 2010, Q3; 
NonSIFIs banks:	7.4%; 
Other bank SIFIs: 6.8%; 
Large bank SIFIS: 6.3%. 

Quarter and year: 2010, Q4; 
NonSIFIs banks:	7.3%; 
Other bank SIFIs: 7.1%; 
Large bank SIFIS: 5.6%. 

Quarter and year: 2011, Q1; 
NonSIFIs banks:	7.5%; 
Other bank SIFIs: 7.1%; 
Large bank SIFIS: 5.8%. 

Quarter and year: 2011, Q2; 
NonSIFIs banks:	7.8%; 
Other bank SIFIs: 7.2%; 
Large bank SIFIS: 5.7%. 

Quarter and year: 2011, Q3; 
NonSIFIs banks:	8.0%; 
Other bank SIFIs: 7.5%; 
Large bank SIFIS: 6.2%. 

Quarter and year: 2011, Q4; 
NonSIFIs banks:	8.0%; 
Other bank SIFIs: 7.5%; 
Large bank SIFIS: 6.6%. 

Quarter and year: 2012, Q1; 
NonSIFIs banks:	8.1%; 
Other bank SIFIs: 7.7%; 
Large bank SIFIS: 6.4%. 

Quarter and year: 2012, Q2; 
NonSIFIs banks:	8.3%; 
Other bank SIFIs: 8.0%; 
Large bank SIFIS: 6.6%. 

Quarter and year: 2012, Q3; 
NonSIFIs banks:	8.5%; 
Other bank SIFIs: 8.0%; 
Large bank SIFIS: 6.6%. 

Quarter and year: 2012, Q4; 
NonSIFIs banks:	8.4%; 
Other bank SIFIs: 8.1%; 
Large bank SIFIS: 6.6%. 

Quarter and year: 2013, Q1; 
NonSIFIs banks:	8.5%; 
Other bank SIFIs: 8.3%; 
Large bank SIFIS: 6.7%. 

Quarter and year: 2013, Q2; 
NonSIFIs banks:	8.4%; 
Other bank SIFIs: 8.2%; 
Large bank SIFIS: 6.9%. 

Source: GAO analysis of data from the Federal Reserve Bank of Chicago. 

Note: To calculate median tangible common equity as a percentage of 
assets, we calculated this percentage for each bank holding company, 
and then reported the median for large bank SIFIs, the median for 
other bank SIFIs, and the median for non-SIFI banks. We used data on 
top-tier bank holding companies that filed form FR Y-9C, which is 
generally filed by top-tier bank holding companies with assets of $500 
million or more, although a small number of bank holding companies 
with assets below that threshold also filed form FR Y-9C. We define 
large bank SIFIs as those with assets of $500 billion or more. Other 
bank SIFIs are those with assets between $50 billion and $500 billion. 
Non-SIFI bank holding companies are those with assets less than $50 
billion. 

[End of figure] 

* Figure 10 shows that median tangible common equity as a percentage 
of risk-weighted assets, which include off-balance sheet activity, 
increased from the third quarter of 2010 through the second quarter of 
2013 but fluctuated over the period. For large bank SIFIs, the 
indicator increased from 10.8 percent to 11.8 percent (or by about 9 
percent) over the period. For the other SIFIs, the indicator increased 
from 9.4 percent to 10.3 percent (or by about 10 percent) over the 
period. This measure of leverage did not change much for either group 
of SIFIs from mid-2012 to mid-2013. 

Figure 10: Median Tangible Common Equity as a Percentage of Risk-
Weighted Assets for Bank Holding Companies by Size, from First Quarter 
2006 through Second Quarter 2013: 

[Refer to PDF for image: multiple line graph] 

Large bank SIFIs: more than or equal to $500 billion in assets; 
Other bank SIFIs: more than or equal to $50 billion, but less than 
$500 billion in assets; 
Non-SIFI banks: more than or equal to 50 million, but less than $50 
billion in assets. 

Quarter and year: 2006, Q1; 
NonSIFIs banks:	9.4%; 
Other bank SIFIs: 7.2%; 
Large bank SIFIS: 6.2%. 

Quarter and year: 2006, Q2; 
NonSIFIs banks:	9.2%; 
Other bank SIFIs: 7.0%; 
Large bank SIFIS: 6.7%. 

Quarter and year: 2006, Q3; 
NonSIFIs banks:	9.5%; 
Other bank SIFIs: 7.3%; 
Large bank SIFIS: 6.7%. 

Quarter and year: 2007, Q4; 
NonSIFIs banks:	9.4%; 
Other bank SIFIs: 7.2%; 
Large bank SIFIS: 6.8%. 

Quarter and year: 2007, Q1; 
NonSIFIs banks:	9.4%; 
Other bank SIFIs: 6.8%; 
Large bank SIFIS: 6.1%. 

Quarter and year: 2007, Q2; 
NonSIFIs banks:	9.2%; 
Other bank SIFIs: 6.3%; 
Large bank SIFIS: 6.4%. 

Quarter and year: 2007, Q3; 
NonSIFIs banks:	9.3%; 
Other bank SIFIs: 6.6%; 
Large bank SIFIS: 5.7%. 

Quarter and year: 2008, Q4; 
NonSIFIs banks:	9.3%; 
Other bank SIFIs: 6.3%; 
Large bank SIFIS: 5.0%. 

Quarter and year: 2008, Q1; 
NonSIFIs banks:	9.3%; 
Other bank SIFIs: 6.2%; 
Large bank SIFIS: 4.4%. 

Quarter and year: 2008, Q2; 
NonSIFIs banks:	8.9%; 
Other bank SIFIs: 6.2%; 
Large bank SIFIS: 4.3%. 

Quarter and year: 2008, Q3; 
NonSIFIs banks:	8.8%; 
Other bank SIFIs: 6.4%; 
Large bank SIFIS: 4.9%. 

Quarter and year: 2009, Q4; 
NonSIFIs banks:	8.6%; 
Other bank SIFIs: 5.9%; 
Large bank SIFIS: 3.7%. 

Quarter and year: 2009, Q1; 
NonSIFIs banks:	8.6%; 
Other bank SIFIs: 5.7%; 
Large bank SIFIS: 5.3%. 

Quarter and year: 2009, Q2; 
NonSIFIs banks:	8.7%; 
Other bank SIFIs: 7.1%; 
Large bank SIFIS: 6.2%. 

Quarter and year: 2009, Q3; 
NonSIFIs banks:	9.1%; 
Other bank SIFIs: 7.6%; 
Large bank SIFIS: 8.2%. 

Quarter and year: 2010, Q4; 
NonSIFIs banks:	9.0%; 
Other bank SIFIs: 7.9%; 
Large bank SIFIS: 8.1%. 

Quarter and year: 2010, Q1; 
NonSIFIs banks:	9.6%; 
Other bank SIFIs: 8.3%; 
Large bank SIFIS: 8.5%. 

Quarter and year: 2010, Q2; 
NonSIFIs banks:	10.0%; 
Other bank SIFIs: 8.7%; 
Large bank SIFIS: 9.3%. 

Quarter and year: 2010, Q3; 
NonSIFIs banks:	10.4%; 
Other bank SIFIs: 9.4%; 
Large bank SIFIS: 10.8%. 

Quarter and year: 2011, Q4; 
NonSIFIs banks:	10.3%; 
Other bank SIFIs: 9.5%; 
Large bank SIFIS: 9.8%. 

Quarter and year: 2011, Q1; 
NonSIFIs banks:	10.8%; 
Other bank SIFIs: 9.6%; 
Large bank SIFIS: 10.1%. 

Quarter and year: 2011, Q2; 
NonSIFIs banks:	11.3%; 
Other bank SIFIs: 9.9%; 
Large bank SIFIS: 10.2%. 

Quarter and year: 2011, Q3; 
NonSIFIs banks:	11.7%; 
Other bank SIFIs: 10.2%; 
Large bank SIFIS: 11.0%. 

Quarter and year: 2011, Q4; 
NonSIFIs banks:	11.7%; 
Other bank SIFIs: 10.0%; 
Large bank SIFIS: 11.0%. 

Quarter and year: 2012, Q1; 
NonSIFIs banks:	12.0%; 
Other bank SIFIs: 10.8%; 
Large bank SIFIS: 11.1%. 

Quarter and year: 2012, Q2; 
NonSIFIs banks:	12.1%; 
Other bank SIFIs: 10.3%; 
Large bank SIFIS: 11.7%. 

Quarter and year: 2012, Q3; 
NonSIFIs banks:	12.4%; 
Other bank SIFIs: 10.6%; 
Large bank SIFIS: 12.4%. 

Quarter and year: 2012, Q4; 
NonSIFIs banks:	12.3%; 
Other bank SIFIs: 10.6%; 
Large bank SIFIS: 13.9%. 

Quarter and year: 2013, Q1; 
NonSIFIs banks:	12.5%; 
Other bank SIFIs: 10.9%; 
Large bank SIFIS: 11.8%. 

Quarter and year: 2013, Q2; 
NonSIFIs banks:	12.1%; 
Other bank SIFIs: 10.3%; 
Large bank SIFIS: 11.8%. 

Source: GAO analysis of data from the Federal Reserve Bank of Chicago. 

Note: To calculate median tangible common equity as a percentage of 
risk-weighted assets, we calculated this percentage for each bank 
holding company, and then reported the median for large bank SIFIs, 
the median for other bank SIFIs, and the median for non-SIFI banks. We 
used data on top-tier bank holding companies that filed form FR Y-9C, 
which is generally filed by top-tier bank holding companies with 
assets of $500 million or more, although a small number of bank 
holding companies with assets below that threshold also filed form FR 
Y-9C. We define large bank SIFIs as those with assets of $500 billion 
or more. Other bank SIFIs are those with assets between $50 billion 
and $500 billion. Non-SIFI bank holding companies are those with 
assets less than $50 billion. 

[End of figure] 

SIFI Liquidity: 

We developed two indicators to analyze changes in SIFI liquidity: (1) 
short-term liabilities as a percentage of total liabilities and (2) 
liquid assets as a percentage of short-term liabilities. Short-term 
liabilities are balance sheet obligations due within 1 year; an 
institution's short-term liabilities as a percentage of total 
liabilities are a measure of its need for liquidity. Liquid assets can 
easily be sold without affecting their price and, thus, can be easily 
converted to cash to cover debts that come due. Accordingly, liquid 
assets as a percentage of an institution's short-term liabilities are 
a measure of access to liquidity. For example, if this percentage is 
under 100 percent, the institution does not have sufficient access to 
liquidity and is unlikely to have enough liquid assets to cover its 
short-term debt. A limitation of both of these indicators is that they 
do not include off-balance sheet liabilities, such as callable 
derivatives or potential derivatives-related obligations. The second 
indicator also does not include off-balance sheet liquid assets, such 
as short-term income from derivative contracts.[Footnote 133] 

Our indicators show that U.S. bank SIFIs have improved their liquidity 
from the third quarter of 2010 through the second quarter of 2013, 
although one of our measures shows that large bank SIFIs' liquidity 
deteriorated from mid-2012 to mid-2013. The figures also show that 
large bank SIFIs held relatively more short-term liabilities and 
liquid assets to cover such liabilities than other bank SIFIs. 

* Figure 11 shows that median short-term liabilities as a percentage 
of total liabilities for large bank SIFIs decreased from 55.1 percent 
to 52.0 percent (or by about 6 percent) over the period, but it 
increased from mid-2012 to mid-2013, reversing a downward trend. For 
the other bank SIFIs, the indicator continued its downward trend over 
the period--declining from 25.4 percent to 20.8 percent (or by about 
18 percent). 

Figure 11: Median Short-Term Liabilities as a Percentage of Total 
Liabilities for U.S. Bank Holding Companies by Size, from First 
Quarter 2006 through Second Quarter 2013: 

[Refer to PDF for image: multiple line graph] 

Large bank SIFIs: more than or equal to $500 billion in assets; 
Other bank SIFIs: more than or equal to $50 billion, but less than 
$500 billion in assets; 
Non-SIFI banks: more than or equal to 50 million, but less than $50 
billion in assets. 

Quarter and year: 2006, Q1; 
NonSIFIs banks:	27.0%; 
Other bank SIFIs: 37.2%; 
Large bank SIFIS: 53.3%. 

Quarter and year: 2006, Q2; 
NonSIFIs banks:	27.5%; 
Other bank SIFIs: 41.5%; 
Large bank SIFIS: 53.6%. 

Quarter and year: 2006, Q3; 
NonSIFIs banks:	28.2%; 
Other bank SIFIs: 41.9%; 
Large bank SIFIS: 54.3%. 

Quarter and year: 2006, Q4; 
NonSIFIs banks:	27.7%; 
Other bank SIFIs: 39.3%; 
Large bank SIFIS: 52.8%. 

Quarter and year: 2007, Q1; 
NonSIFIs banks:	26.7%; 
Other bank SIFIs: 37.4%; 
Large bank SIFIS: 56.8%. 

Quarter and year: 2007, Q2; 
NonSIFIs banks:	26.4%; 
Other bank SIFIs: 38.9%; 
Large bank SIFIS: 54.5%. 

Quarter and year: 2007, Q3; 
NonSIFIs banks:	26.8%; 
Other bank SIFIs: 36.8%; 
Large bank SIFIS: 57.5%. 

Quarter and year: 2007, Q4; 
NonSIFIs banks:	27.6%; 
Other bank SIFIs: 37.8%; 
Large bank SIFIS: 54.3%. 

Quarter and year: 2008, Q1; 
NonSIFIs banks:	28.2%; 
Other bank SIFIs: 38.1%; 
Large bank SIFIS: 52.7%. 

Quarter and year: 2008, Q2; 
NonSIFIs banks:	29.1%; 
Other bank SIFIs: 38.4%; 
Large bank SIFIS: 53.1%. 

Quarter and year: 2008, Q3; 
NonSIFIs banks:	28.6%; 
Other bank SIFIs: 36.8%; 
Large bank SIFIS: 53.3%. 

Quarter and year: 2008, Q4; 
NonSIFIs banks:	28.8%; 
Other bank SIFIs: 34.0%; 
Large bank SIFIS: 52.0%. 

Quarter and year: 2009, Q1; 
NonSIFIs banks:	28.0%; 
Other bank SIFIs: 33.7%; 
Large bank SIFIS: 53.3%. 

Quarter and year: 2009, Q2; 
NonSIFIs banks:	27.6%; 
Other bank SIFIs: 32.4%; 
Large bank SIFIS: 56.1%. 

Quarter and year: 2009, Q3; 
NonSIFIs banks:	27.6%; 
Other bank SIFIs: 27.8%; 
Large bank SIFIS: 56.0%. 

Quarter and year: 2009, Q4; 
NonSIFIs banks:	27.2%; 
Other bank SIFIs: 26.7%; 
Large bank SIFIS: 55.5%. 

Quarter and year: 2010, Q1; 
NonSIFIs banks:	26.5%; 
Other bank SIFIs: 27.6%; 
Large bank SIFIS: 57.2%. 

Quarter and year: 2010, Q2; 
NonSIFIs banks:	25.7%; 
Other bank SIFIs: 25.2%; 
Large bank SIFIS: 54.1%. 

Quarter and year: 2010, Q3; 
NonSIFIs banks:	25.2%; 
Other bank SIFIs: 25.4%; 
Large bank SIFIS: 55.1%. 

Quarter and year: 2010, Q4; 
NonSIFIs banks:	24.3%; 
Other bank SIFIs: 24.5%; 
Large bank SIFIS: 52.7%. 

Quarter and year: 2011, Q1; 
NonSIFIs banks:	23.8%; 
Other bank SIFIs: 24.1%; 
Large bank SIFIS: 53.7%. 

Quarter and year: 2011, Q2; 
NonSIFIs banks:	23.4%; 
Other bank SIFIs: 23.1%; 
Large bank SIFIS: 52.0%. 

Quarter and year: 2011, Q3; 
NonSIFIs banks:	22.8%; 
Other bank SIFIs: 22.9%; 
Large bank SIFIS: 48.4%. 

Quarter and year: 2011, Q4; 
NonSIFIs banks:	21.8%; 
Other bank SIFIs: 24.1%; 
Large bank SIFIS: 46.1%. 

Quarter and year: 2012, Q1; 
NonSIFIs banks:	21.1%; 
Other bank SIFIs: 22.4%; 
Large bank SIFIS: 47.1%. 

Quarter and year: 2012, Q2; 
NonSIFIs banks:	20.9%; 
Other bank SIFIs: 22.7%; 
Large bank SIFIS: 46.4%. 

Quarter and year: 2013, Q3; 
NonSIFIs banks:	20.6%; 
Other bank SIFIs: 22.5%; 
Large bank SIFIS: 46.8%. 

Quarter and year: 2012, Q4; 
NonSIFIs banks:	19.2%; 
Other bank SIFIs: 21.7%; 
Large bank SIFIS: 51.1%. 

Quarter and year: 2013, Q1; 
NonSIFIs banks:	18.9%; 
Other bank SIFIs: 21.4%; 
Large bank SIFIS: 51.7%. 

Quarter and year: 2013, Q2; 
NonSIFIs banks:	19.5%; 
Other bank SIFIs: 20.8%; 
Large bank SIFIS: 52.0%. 

Source: GAO analysis of data from the Federal Reserve Bank of Chicago. 

Note: To calculate median short-term liabilities as a percentage of 
total liabilities, we calculated this percentage for each bank holding 
company, and then reported the median for large bank SIFIs, the median 
for other bank SIFIs, and the median for non-SIFI banks. We used data 
on top-tier bank holding companies that filed form FR Y-9C, which is 
generally filed by top-tier bank holding companies with assets of $500 
million or more, although a small number of bank holding companies 
with assets below that threshold also filed form FR Y-9C. We define 
large bank SIFIs as those with assets of $500 billion or more. Other 
bank SIFIs are those with assets between $50 billion and $500 billion. 
Non-SIFI bank holding companies are those with assets less than $50 
billion. 

[End of figure] 

* Figure 12 shows that median short-term (or liquid) assets as a 
percentage of short-term liabilities generally continued its upward 
trend for both large and other SIFIs from the third quarter of 2010 
through the second quarter of 2013. Specifically, the indicator 
increased from 100.7 percent to 136.5 percent (or by 35 percent) for 
large bank SIFIs and from 79.0 percent to 104.9 percent (or by 33 
percent) for other bank SIFIs. 

Figure 12: Median Liquid Assets as a Percentage of Short-term 
Liabilities for U.S. Bank Holding Companies by Size, from First 
Quarter 2006 through Second Quarter 2013: 

[Refer to PDF for image: multiple line graph] 

Large bank SIFIs: more than or equal to $500 billion in assets; 
Other bank SIFIs: more than or equal to $50 billion, but less than 
$500 billion in assets; 
Non-SIFI banks: more than or equal to 50 million, but less than $50 
billion in assets. 

Quarter and year: 2006, Q1; 
NonSIFIs banks:	51.5%; 
Other bank SIFIs: 37.8%; 
Large bank SIFIS: 79.6%. 

Quarter and year: 2006, Q2; 
NonSIFIs banks:	44.9%; 
Other bank SIFIs: 37.2%; 
Large bank SIFIS: 78.7%. 

Quarter and year: 2006, Q3; 
NonSIFIs banks:	43.9%; 
Other bank SIFIs: 33.6%; 
Large bank SIFIS: 69.3%. 

Quarter and year: 2006, Q4; 
NonSIFIs banks:	48.5%; 
Other bank SIFIs: 39.3%; 
Large bank SIFIS: 70.8%. 

Quarter and year: 2007, Q1; 
NonSIFIs banks:	49.5%; 
Other bank SIFIs: 40.9%; 
Large bank SIFIS: 81.6%. 

Quarter and year: 2007, Q2; 
NonSIFIs banks:	46.4%; 
Other bank SIFIs: 37.5%; 
Large bank SIFIS: 73.6%. 

Quarter and year: 2007, Q3; 
NonSIFIs banks:	42.6%; 
Other bank SIFIs: 34.4%; 
Large bank SIFIS: 64.3%. 

Quarter and year: 2007, Q4; 
NonSIFIs banks:	39.6%; 
Other bank SIFIs: 35.3%; 
Large bank SIFIS: 68.2%. 

Quarter and year: 2008, Q1; 
NonSIFIs banks:	39.3%; 
Other bank SIFIs: 34.5%; 
Large bank SIFIS: 69.5%. 

Quarter and year: 2008, Q2; 
NonSIFIs banks:	35.2%; 
Other bank SIFIs: 32.3%; 
Large bank SIFIS: 70.4%. 

Quarter and year: 2008, Q3; 
NonSIFIs banks:	33.4%; 
Other bank SIFIs: 29.7%; 
Large bank SIFIS: 83.7%. 

Quarter and year: 2008, Q4; 
NonSIFIs banks:	36.0%; 
Other bank SIFIs: 48.2%; 
Large bank SIFIS: 74.5%. 

Quarter and year: 2009, Q1; 
NonSIFIs banks:	43.5%; 
Other bank SIFIs: 55.3%; 
Large bank SIFIS: 88.2%. 

Quarter and year: 2009, Q2; 
NonSIFIs banks:	45.3%; 
Other bank SIFIs: 55.5%; 
Large bank SIFIS: 96.9%. 

Quarter and year: 2009, Q3; 
NonSIFIs banks:	50.0%; 
Other bank SIFIs: 63.6%; 
Large bank SIFIS: 96.2%. 

Quarter and year: 2009, Q4; 
NonSIFIs banks:	53.6%; 
Other bank SIFIs: 68.3%; 
Large bank SIFIS: 98.7%. 

Quarter and year: 2010, Q1; 
NonSIFIs banks:	59.7%; 
Other bank SIFIs: 70.0%; 
Large bank SIFIS: 96.3%. 

Quarter and year: 2010, Q2; 
NonSIFIs banks:	62.1%; 
Other bank SIFIs: 70.9%; 
Large bank SIFIS: 99.4%. 

Quarter and year: 2010, Q3; 
NonSIFIs banks:	66.9%; 
Other bank SIFIs: 79.0%; 
Large bank SIFIS: 100.7%. 

Quarter and year: 2010, Q4; 
NonSIFIs banks:	71.1%; 
Other bank SIFIs: 76.7%; 
Large bank SIFIS: 106.8%. 

Quarter and year: 2011, Q1; 
NonSIFIs banks:	78.5%; 
Other bank SIFIs: 86.2%; 
Large bank SIFIS: 105.0%. 

Quarter and year: 2011, Q2; 
NonSIFIs banks:	79.4%; 
Other bank SIFIs: 93.2%; 
Large bank SIFIS: 109.5%. 

Quarter and year: 2011, Q3; 
NonSIFIs banks:	86.5%; 
Other bank SIFIs: 99.5%; 
Large bank SIFIS: 120.8%. 

Quarter and year: 2011, Q4; 
NonSIFIs banks:	90.7%; 
Other bank SIFIs: 99.6%; 
Large bank SIFIS: 124.7%. 

Quarter and year: 2012, Q1; 
NonSIFIs banks:	99.6%; 
Other bank SIFIs: 94.9%; 
Large bank SIFIS: 133.9%. 

Quarter and year: 2012, Q2; 
NonSIFIs banks:	96.5%; 
Other bank SIFIs: 102.6%; 
Large bank SIFIS: 124.2%. 

Quarter and year: 2012, Q3; 
NonSIFIs banks:	98.6%; 
Other bank SIFIs: 92.8%; 
Large bank SIFIS: 132.1%. 

Quarter and year: 2012, Q4; 
NonSIFIs banks:	107.5%; 
Other bank SIFIs: 101.4%; 
Large bank SIFIS: 135.9%. 

Quarter and year: 2013, Q1; 
NonSIFIs banks:	110.7%; 
Other bank SIFIs: 99.2%; 
Large bank SIFIS: 136.9%. 

Quarter and year: 2013, Q2; 
NonSIFIs banks:	101.851; 
Other bank SIFIs: 104.888; 
Large bank SIFIS: 136.5%. 

Source: GAO analysis of data from the Federal Reserve Bank of Chicago. 

Note: To calculate median liquid assets as a percentage of short-term 
liabilities, we calculated this percentage for each bank holding 
company, and then reported the median for large bank SIFIs, the median 
for other bank SIFIs, and the median for non-SIFI banks. We used data 
on top-tier bank holding companies that filed form FR Y-9C, which is 
generally filed by top-tier bank holding companies with assets of $500 
million or more, although a small number of bank holding companies 
with assets below that threshold also filed form FR Y-9C. We define 
large bank SIFIs as those with assets of $500 billion or more. Other 
bank SIFIs are those with assets between $50 billion and $500 billion. 
Non-SIFI bank holding companies are those with assets less than $50 
billion. 

[End of figure] 

[End of section] 

Appendix VII: Econometric Analyses of the Impact of Enhanced 
Regulation and Oversight on SIFIs: 

Methodology: 

We conducted an econometric analysis to assess the impact of the Dodd-
Frank Act's new requirements for bank SIFIs on (1) the cost of credit 
they provide and (2) their safety and soundness. Our multivariate 
econometric model uses a difference-in-difference design that exploits 
the fact that the Dodd-Frank Act subjects bank holding companies with 
total consolidated assets of $50 billion or more to enhanced 
regulation by the Federal Reserve but not others, so we can view bank 
holding companies with total consolidated assets of $50 billion or 
more (bank SIFIs) as the treatment group and other bank holding 
companies as the control group. We compared the changes in the 
characteristics of U.S. bank SIFIs over time to changes in the 
characteristics of other U.S. bank holding companies over time. All 
else being equal, the difference in the differences is the initial 
impact of new requirements for bank SIFIs primarily tied to enhanced 
regulation and oversight under the Federal Reserve. 

Our general regression specification is the following: 

ybq = ab + bq + gSIFIbq + X'bqF + ebq: 

where b denotes the bank holding company, q denotes the quarter, ybq 
is the dependent variable, ab is a bank holding company-specific 
intercept, bq is a quarter-specific intercept, SIFIbq is an indicator 
variable that equals 1 if bank holding company b is a SIFI in quarter 
q and 0 otherwise, Xbq is a list of other independent variables, and 
ebq is an error term. We estimated the parameters of the model using 
quarterly data on top-tier bank holding companies that filed form FR Y-
9C for the period from the first quarter of 2006 to the second quarter 
of 2012. 

The parameter of interest is g, the coefficient on the SIFI indicator, 
which is equal to one for bank holding companies with consolidated 
assets of $50 billion or more in the quarters starting with the 
treatment start date and is equal to zero otherwise. The Dodd-Frank 
Act was enacted in July 2010, so the treatment start date is the third 
quarter of 2010. Thus, the parameter g measures the average difference 
in the difference in dependent variable between bank SIFIs and other 
bank holding companies after and before the Dodd-Frank Act was enacted. 

We use different dependent variables (ybq) to estimate the initial 
impacts of the new requirements for SIFIs on the cost of credit 
provided by bank SIFIs and on various aspects of bank SIFIs' safety 
and soundness, including capital adequacy, asset quality, earnings, 
and liquidity. 

* Funding cost. A bank holding company's funding cost is the cost of 
deposits or liabilities that it then uses to make loans or otherwise 
acquire assets. More specifically, a bank holding company's funding 
cost is the interest rate it pays when it borrows funds. All else 
being equal, the greater a bank holding company's funding cost, the 
greater the interest rate it charges when it makes loans. We measure 
funding cost as an institution's interest expense as a percentage of 
interest-bearing liabilities. 

* Capital adequacy. Capital absorbs losses, promotes public 
confidence, helps restrict excessive asset growth, and provides 
protection to creditors. We use two alternative measures of capital 
adequacy: tangible common equity as a percentage of total assets and 
tangible common equity as a percentage of risk-weighted assets. 

* Asset quality. Asset quality reflects the quantity of existing and 
potential credit risk associated with the institution's loan and 
investment portfolios and other assets, as well as off-balance sheet 
transactions. Asset quality also reflects the ability of management to 
identify and manage credit risk. We measure asset quality as 
performing assets as a percentage of total assets, where performing 
assets are equal to total assets less assets 90 days or more past due 
and still accruing interest, assets in non-accrual status, and other 
real estate owned. 

* Earnings. Earnings are the initial safeguard against the risks of 
engaging in the banking business and represent the first line of 
defense against capital depletion that can result from declining asset 
values. We measure earnings as net income as a percentage of total 
assets. 

* Liquidity. Liquidity represents the ability to fund assets and meet 
obligations as they become due, and liquidity risk is the risk of not 
being able to obtain funds at a reasonable price within a reasonable 
time period to meet obligations as they become due. We use two 
different variables to measure liquidity. The first variable is liquid 
assets as a percentage of volatile liabilities. This variable is 
similar in spirit to the liquidity coverage ratio introduced by the 
Basel Committee on Banking Supervision and measures a bank holding 
company's capacity to meet its liquidity needs under a significantly 
severe liquidity stress scenario. We measure liquid assets as the sum 
of cash and balances due from depository institutions, securities 
(less pledged securities), federal funds sold and reverse repurchases, 
and trading assets. We measure volatile liabilities as the sum of 
federal funds purchased and repurchase agreements, trading liabilities 
(less derivatives with negative fair value), other borrowed funds, 
deposits held in foreign offices, and large time deposits held in 
domestic offices. Large time deposits are defined as time deposits 
greater than $100,000 prior to March 2010 and as time deposits greater 
than $250,000 in and after March 2010. 

The second liquidity variable is stable liabilities as a percentage of 
total liabilities. This variable measures the extent to which a bank 
holding company relies on stable funding sources to finance its assets 
and activities. This variable is related in spirit to the net stable 
funding ratio introduced by the Basel Committee on Banking 
Supervision, which measures the amount of stable funding based on the 
liquidity characteristics of an institution's assets and activities 
over a 1 year horizon. We measure stable funding as total liabilities 
minus volatile liabilities as described earlier. 

Finally, we include a limited number of independent variables (Xbq) to 
control for factors that may differentially affect SIFIs and non-SIFIs 
in the quarters since the Dodd-Frank Act was enacted. We include these 
variables to reduce the likelihood that our estimates of the impact of 
new requirements for SIFIs are reflecting something other than the 
impact of the Dodd-Frank Act's new requirements for SIFIs. 

* Nontraditional income. Nontraditional income generally captures 
income from capital market activities. Bank holding companies with 
more nontraditional income are likely to have different business 
models than those with more income from traditional banking 
activities. Changes in capital markets in the period since the Dodd-
Frank Act was enacted may have had a greater effect on bank holding 
companies with more nontraditional income. If bank SIFIs typically 
have more nontraditional income than other bank holding companies, 
then changes in capital markets in the time since the Dodd-Frank Act 
was enacted may have differentially affected the two groups. We 
measure nontraditional income as the sum of trading revenue; 
investment banking, advisory, brokerage, and underwriting fees and 
commissions; venture capital revenue; insurance commissions and fees; 
and interest income from trading assets less associated interest 
expense, and we express nontraditional income as a percentage of 
operating revenue. 

* Securitization income. Bank holding companies with more income from 
securitization are likely to have different business models than those 
with more income from traditional banking associated with an originate-
to-hold strategy for loans. Changes in the market for securitized 
products in the period since the Dodd-Frank Act was enacted may thus 
have had a greater effect on bank holding companies with more 
securitization income. If bank SIFIs typically have more 
securitization income than other bank holding companies, then changes 
in the market for securitized products in the time since the Dodd-
Frank Act was enacted may have differentially affected the two groups. 
We measure securitization income as the sum of net servicing fees, net 
securitization income, and interest and dividend income on mortgage-
backed securities minus associated interest expense, and we express 
securitization as a percentage of operating revenue. Operating revenue 
is the sum of interest income and noninterest income less interest 
expense and loan loss provisions. 

* Foreign exposure. Changes in other countries, such as the sovereign 
debt crisis in Europe, may have a larger effect on bank holding 
companies with more foreign exposure. If bank SIFIs typically have 
more foreign exposure than other bank holding companies, then changes 
in foreign markets may have differentially affected the two groups. We 
measure foreign exposure as the sum of foreign debt securities (held-
to-maturity and available-for-sale), foreign bank loans, commercial 
and industrial loans to non-U.S. addresses, and foreign government 
loans. We express foreign exposure as a percentage of total assets. 

* Size. We include size because bank SIFIs tend to be larger than 
other bank holding companies, and market pressures or other forces not 
otherwise accounted for may have differentially affected large and 
small bank holding companies in the time since the Dodd-Frank Act was 
enacted. We measure the size of a bank holding company as the natural 
logarithm of its total assets. 

* CPP participation. We control for whether or not a bank holding 
company participated in the Capital Purchase Program (CPP) component 
of the Troubled Asset Relief Program (TARP) to differentiate any 
impact that this program may have had from the impact of the Dodd-
Frank Act. 

We also conducted several sets of robustness checks: 

* We restricted our sample to the set of institutions with assets that 
are "close" to the $50 billion cutoff for enhanced prudential 
regulation for bank SIFIs. Specifically, we analyzed two restricted 
samples of bank holding companies: (1) bank holding companies with 
assets between $25 billion and $75 billion and (2) bank holding 
companies with assets between $1 billion and $100 billion. 

* We examined different treatment start dates. Specifically, we 
allowed the Dodd-Frank Act's new requirements for SIFIs to have an 
impact in 2009 quarter 3, 1 year prior to the passage of the act. We 
did so to allow for the possibility that institutions began to react 
to the act's requirements in anticipation of the act being passed. 

* We analyzed alternative measures of capital adequacy, including 
equity capital as a percentage of total assets and Tier 1 capital as a 
percentage of risk-weighted assets. 

* We allowed the effect of the treatment to vary by quarter. 

Data: 

We conducted our analysis using quarterly data on bank holding 
companies that filed form FR Y-9C obtained from the Federal Reserve 
Bank of Chicago for the period from the first quarter of 2006 to the 
second quarter of 2013. 

Results: 

Our econometric analysis assesses the initial impact of the Dodd-Frank 
Act's new requirements for bank SIFIs on (1) the cost of credit they 
provide and (2) their safety and soundness. Our analysis leverages the 
Dodd-Frank Act's requirement that bank holding companies with total 
consolidated assets of $50 billion or more are subject to enhanced 
regulation by the Federal Reserve but other bank holding companies are 
not by comparing funding costs, capital adequacy, asset quality, 
earnings, and liquidity for bank SIFIs and non-SIFI bank holding 
companies before and after the implementation of the enhanced 
prudential requirements. All else being equal, the difference in the 
comparative differences is the inferred effect of the Dodd-Frank Act 
on bank SIFIs. While some of the SIFI-related rulemakings have yet to 
be finalized, our estimates are suggestive of the initial effects of 
the Dodd-Frank Act on bank SIFIs and provide a baseline against which 
to compare future results.[Footnote 134] 

Our baseline estimates suggest that the Dodd-Frank Act has not been 
associated with a significant change in U.S. bank SIFIs' funding costs 
(table 12). To the extent that the cost of credit provided by bank 
SIFIs is a function of their funding costs, the new requirements for 
SIFIs are likely to have had little effect on the cost of credit to 
date. 

Table 12: Estimated Changes in U.S. Bank SIFIs' Funding Costs and 
Measures of Safety and Soundness Associated with the Dodd-Frank Act, 
from Third Quarter 2010 through Second Quarter 2013: 

Variable: Funding cost; (cost of credit); 
Measured as: Interest expense as a percentage of interest-bearing 
liabilities; 
Estimated change (percentage points): Baseline: 0.02; (0.02); [0.92]; 
Sample restricted to BHCs with assets $25-75 billion: -0.01; (0.04); 
[0.88]; 
Sample restricted to BHCs with assets $1 billion-100 billion: -0.02; 
(0.02); [0.93]; 
Impact of DFA anticipated enactment by 1 year: -0.03; (0.02); [0.92]. 

Variable: Capital adequacy; (safety and soundness); 

Measured as: Tangible common equity as a percentage of total assets; 
Estimated change (percentage points): Baseline: 1.50**; (0.22); [0.07]; 
Sample restricted to BHCs with assets $25-75 billion: 0.27; (0.69); 
[0.43]; 
Sample restricted to BHCs with assets $1 billion-100 billion: 1.16**; 
(0.24); [0.10]; 
Impact of DFA anticipated enactment by 1 year: 1.58**; (0.24); [0.07]. 

Measured as: Tangible common equity as a percentage of risk-weighted 
assets; 
Estimated change (percentage points): Baseline: 2.02**; (0.36); [0.11]; 
Sample restricted to BHCs with assets $25-75 billion: 0.17; (0.92); 
[0.52]; 
Sample restricted to BHCs with assets $1 billion-100 billion: 1.12**; 
(0.31); [0.17]; 
Impact of DFA anticipated enactment by 1 year: 2.21**; (0.38); [0.12]. 

Variable: Asset quality; (safety and soundness); 
Measured as: Performing assets as a percentage of total assets; 
Estimated change (percentage points): Baseline: 0.41**; (0.13); [0.30]; 
Sample restricted to BHCs with assets $25-75 billion: 1.08; (0.58); 
[0.72]; 
Sample restricted to BHCs with assets $1 billion-100 billion: 0.60**; 
(0.17); [0.34]; 
Impact of DFA anticipated enactment by 1 year: 0.37**; (0.14); [0.30]. 

Variable: Earnings; (safety and soundness); 
Measured as: Net income as a percentage of total assets; 
Estimated change (percentage points): Baseline: 0.09**; (0.03); [0.15]; 
Sample restricted to BHCs with assets $25-75 billion: 0.06; (0.12); 
[0.29]; 
Sample restricted to BHCs with assets $1 billion-100 billion: 0.11**; 
(0.05); [0.15]; 
Impact of DFA anticipated enactment by 1 year: 0.14**; (0.03); [0.15]. 

Variable: Liquidity; (safety and soundness); 

Measured as: Liquid assets as a percentage of short-term liabilities; 
Estimated change (percentage points): Baseline: -1.80; (8.87); [0.25]; 
Sample restricted to BHCs with assets $25-75 billion: 49.23**; (15.77); 
[0.45]; 
Sample restricted to BHCs with assets $1 billion-100 billion: -5.11; 
(14.56); [0.27]; 
Impact of DFA anticipated enactment by 1 year: 9.12; (9.23); [0.25]. 

Measured as: Number of observations: Long-term liabilities as a 
percentage of total liabilities; 
Estimated change (percentage points): Baseline: 5.12**; (1.01); [0.26]; 
Sample restricted to BHCs with assets $25-75 billion: 2.81; (1.65); 
[0.72]; 
Sample restricted to BHCs with assets $1 billion-100 billion: 4.62**; 
(1.77); [0.34]; 
Impact of DFA anticipated enactment by 1 year: 6.11**; (1.03); [0.26]. 

Number of observations: 
Baseline: 30,124; 
Sample restricted to BHCs with assets $25-75 billion: 478; 
Sample restricted to BHCs with assets $1 billion-100 billion: 13,169; 
Impact of DFA anticipated enactment by 1 year: 30,124. 

Number of bank holding companies: 
Baseline: 1,424; 
Sample restricted to BHCs with assets $25-75 billion: 31; 
Sample restricted to BHCs with assets $1 billion-100 billion: 681; 
Impact of DFA anticipated enactment by 1 year: 1,424. 

Source: GAO analysis of data from the Federal Reserve Bank of Chicago. 

Notes: We analyzed data for top-tier bank holding companies that filed 
form FR Y-9C from the first quarter of 2006 through the second quarter 
of 2013. We estimated the effects of the new SIFI requirements on bank 
SIFIs by regressing the variables listed in the table on indicators 
for each bank holding company, indicators for each quarter, indicators 
for whether a bank holding company is a SIFI for quarters from the 
third in 2010 through the second in 2013, and other variables 
controlling for size, foreign exposure, securitization income, other 
nontraditional income, and participation in the Troubled Asset Relief 
Program. Estimated changes are the coefficients on the indicators for 
whether a bank holding company is a SIFI in quarters from the third in 
2010 through the second in 2013. We used t-tests to assess whether the 
coefficient on the SIFI indicator was significant at the 5 percent 
level. **=estimate is statistically significant at the 5 percent 
level. Parentheses contain the standard errors of the estimated 
changes. Square brackets contain the within R-squareds for each 
regression. 

[End of table] 

Our baseline estimates also suggest that the Dodd-Frank Act is 
associated with improvements in most measures of U.S. bank SIFIs' 
safety and soundness. Bank SIFIs appear to be holding more capital 
than they otherwise would have held in every quarter since the Dodd-
Frank Act was enacted (see "Baseline" column in table 12). The quality 
of assets on the balance sheets of bank SIFIs also seems to have 
improved since the Dodd-Frank Act was enacted. The act is associated 
with higher earnings for bank SIFIs in the time period after the act's 
enactment. It is also associated with improved liquidity as measured 
by the extent to which a bank holding company is using stable sources 
of funding. The only measure that has not clearly improved since the 
act's enactment was liquidity as measured by the capacity of a bank 
holding company's liquid assets to cover its volatile liabilities. 
Thus, the Dodd-Frank Act appears to be broadly associated with 
improvements in most indicators of safety and soundness for U.S. bank 
SIFIs (relative to non-SIFI bank holding companies). 

Our approach allows us to partially differentiate changes in funding 
costs, capital adequacy, asset quality, earnings, and liquidity 
associated with the Dodd-Frank Act from changes due to other factors. 
However, several factors make isolating and measuring the impact of 
the Dodd-Frank Act's new requirements for SIFIs challenging. The 
effects of the act cannot be differentiated from the effects of 
simultaneous changes in economic conditions, such as the pace of the 
recovery from the recent recession, or regulations, such as those 
stemming from Basel III, or other changes, such as in credit ratings 
that differentially may affect bank SIFIs and other bank holding 
companies. In addition, some of the new requirements for SIFIs have 
yet to be implemented. Nevertheless, our estimates are suggestive of 
the initial effects of the Dodd-Frank Act on bank SIFIs and provide a 
baseline against which to compare future trends. 

The results of our robustness checks are as follows: 

* Our results for funding costs are generally robust to restricting 
the set of bank holding companies we analyze to those with assets of 
$25 billion-$75 billion, but our results for capital adequacy, asset 
quality, earnings, and liquidity are not. 

* Our results are generally robust to restricting the set of bank 
holding companies we analyze to those with assets of $1 billion-$100 
billion. 

* Our results are generally robust to starting the treatment in the 
third quarter of 2009, 1 year prior to the passage of the Dodd-Frank 
Act. This finding is consistent with the idea that bank holding 
companies began to change their behavior in anticipation of the act's 
requirements, perhaps as information about the content of the act 
became available and the likelihood of its passage increased. However, 
there may be other explanations, including anticipation of Basel III 
requirements, reactions to stress tests, and market pressures to 
improve capital adequacy and liquidity. 

* Our results for the impact on capital adequacy are generally similar 
when we measure capital adequacy using Tier 1 capital as a percentage 
of assets or risk-weighted assets but not when we measure capital 
adequacy using equity capital as a percentage of assets (see table 13). 

Table 13: Estimated Changes in Bank SIFIs' Capital Adequacy Indicators 
Associated with the Dodd-Frank Act, from Third Quarter 2010 through 
Second Quarter 2013: 

Capital adequacy measured as:: Total bank holding company equity as a 
percentage of total assets; 
Estimated change (percentage points): 0.58; (0.30); [0.04]. 

Capital adequacy measured as:: Tier 1 capital as a percentage of total 
assets; 
Estimated change (percentage points): 0.82**; (0.23); [0.04]. 

Capital adequacy measured as:: Tier 1 capital as a percentage of risk-
weighted assets; 
Estimated change (percentage points): 0.99**; (0.34); [0.10]. 

Number of observations: 
Estimated change (percentage points): 30,124. 

Number of bank holding companies: 
Estimated change (percentage points): 1,424. 

Source: GAO analysis of data from the Federal Reserve Bank of Chicago. 

Notes: We analyzed data for top-tier bank holding companies that filed 
form FR Y-9C from the first quarter of 2006 through the second quarter 
of 2013. We estimated the effects of the new SIFI requirements on bank 
SIFIs by regressing the variables listed in the table on indicators 
for each bank holding company, indicators for each quarter, indicators 
for whether a bank holding company is a SIFI for quarters from the 
third in 2010 through the second in 2013, and other variables 
controlling for size, foreign exposure, securitization income, other 
nontraditional income, and participation in the Troubled Asset Relief 
Program. Estimated changes are the coefficients on the indicators for 
whether a bank holding company is a SIFI in quarters from the third in 
2010 through the second in 2013. We used t-tests to assess whether the 
coefficient on the SIFI indicator was significant at the 5 percent 
level. **=estimate is statistically significant at the 5 percent 
level. Parentheses contain the standard errors of the estimated 
changes. Square brackets contain the within R-squareds for each 
regression. 

[End of table] 

* Our results are generally robust to allowing the treatment effect to 
vary by quarter (see table 14). 

Table 14: Estimated Changes in Bank SIFIs' Funding Cost and Safety and 
Soundness Indicators Associated with the Dodd-Frank Act, from Third 
Quarter 2010 through Second Quarter 2013: 

Table 14: Estimated Changes in Bank SIFIs' Funding Cost and Safety and 
Soundness Indicators Associated with the Dodd-Frank Act, 2010Q3-2013Q2: 

Interest expense as a percentage of interest-bearing liabilities: 
Estimated change (percentage points): 
2010: Q3: -0.02; (0.02); 
2010: Q4: 0.01; (0.02); 
2010: Q1: 0.02; (0.02); 
2011: Q2: 0.02; (0.02); 
2011: Q3: 0.01; (0.02); 
2011: Q4: 0.01; (0.02); 
2012: Q1: 0.03; (0.02); 
2012: Q2: 0.04**; (0.02); 
2012: Q3: 0.04; (0.02); 
2013: Q4: 0.01; (0.03); 
2013: Q1: 0.04**; (0.02); 
2013: Q2: 0.04**; (0.02). 

Tangible common equity as a percentage of total assets: 
Estimated change (percentage points): 
2010: Q3: 1.06**; (0.20); 
2010: Q4: 1.46**; (0.22); 
2010: Q1: 1.46**; (0.23); 
2011: Q2: 1.37**; (0.23); 
2011: Q3: 1.32**; (0.23); 
2011: Q4: 1.43**; (0.24); 
2012: Q1: 1.66**; (0.22); 
2012: Q2: 1.60**; (0.26); 
2012: Q3: 1.52**; (0.25); 
2013: Q4: 1.63**; (0.26); 
2013: Q1: 1.70**; (0.27); 
2013: Q2: 1.89**; (0.27). 

Tangible common equity as a percentage of risk-weighted assets: 
Estimated change (percentage points): 
2010: Q3: 1.62**; (0.30); 
2010: Q4: 2.14**; (0.35); 
2010: Q1: 2.06**; (0.37); 
2011: Q2: 1.90**; (0.37); 
2011: Q3: 1.81**; (0.35); 
2011: Q4: 1.88**; (0.40); 
2012: Q1: 2.03**; (0.38); 
2012: Q2: 2.09**; (0.47); 
2012: Q3: 2.05**; (0.46); 
2013: Q4: 2.27**; (0.46); 
2013: Q1: 1.98**; (0.42); 
2013: Q2: 2.45**; (0.42). 

Performing assets as a percentage of total assets: 
Estimated change (percentage points): 
2010: Q3: 0.38**; (0.14); 
2010: Q4: 0.45**; (0.13); 
2010: Q1: 0.45**; (0.14); 
2011: Q2: 0.54**; (0.13); 
2011: Q3: 0.52**; (0.13); 
2011: Q4: 0.41**; (0.14); 
2012: Q1: 0.45**; (0.13); 
2012: Q2: 0.46**; (0.15); 
2012: Q3: 0.39**; (0.15); 
2013: Q4: 0.35**; (0.17); 
2013: Q1: 0.29; (0.16); 
2013: Q2: 0.26; (0.16). 

Net income as a percentage of total assets: 
Estimated change (percentage points): 
2010: Q3: 0.13**; (0.04); 
2010: Q4: 0.22**; (0.05); 
2010: Q1: 0.13**; (0.03); 
2011: Q2: 0.12**; (0.04); 
2011: Q3: 0.11**; (0.04); 
2011: Q4: 0.03; (0.10); 
2012: Q1: 0.05; (0.04); 
2012: Q2: 0.02; (0.03); 
2012: Q3: 0.05; (0.04); 
2013: Q4: 0.10; (0.06); 
2013: Q1: 0.07; (0.05); 
2013: Q2: -0.06; (0.11). 

Liquid assets as a percentage of short-term liabilities: 
Estimated change (percentage points): 
2010: Q3: 6.34; (6.67); 
2010: Q4: 6.81; (6.89); 
2010: Q1: -1.83; (7.24); 
2011: Q2: 0.24; (7.60); 
2011: Q3: 4.24; (8.70); 
2011: Q4: -2.88; (9.71); 
2012: Q1: -3.52; (11.30); 
2012: Q2: -3.41; (10.95); 
2012: Q3: -1.85; (12.09); 
2013: Q4: -9.86; (12.27); 
2013: Q1: -14.11; (11.84); 
2013: Q2: -6.07; (12.02). 

Long-term liabilities as a percentage of total liabilities: 
Estimated change (percentage points): 
2010: Q3: 3.82**; (0.87); 
2010: Q4: 3.94**; (0.93); 
2010: Q1: 3.36**; (1.03); 
2011: Q2: 4.14**; (1.02); 
2011: Q3: 5.72**; (1.08); 
2011: Q4: 6.13**; (1.20); 
2012: Q1: 5.64**; (1.24); 
2012: Q2: 5.85**; (1.19); 
2012: Q3: 5.85**; (1.21); 
2013: Q4: 5.94**; (1.23); 
2013: Q1: 5.56**; (1.26); 
2013: Q2: 6.15**; (1.25). 

Number of observations: 30,124. 

Number of bank holding companies: 1,424. 

Source: GAO analysis of data from the Federal Reserve Bank of Chicago. 

Notes: We analyzed data for top-tier bank holding companies that filed 
form FR Y-9C from the first quarter of 2006 through the second quarter 
of 2013. We estimated the effects of the new SIFI requirements on bank 
SIFIs by regressing the variables listed in the table on indicators 
for each bank holding company, indicators for each quarter, indicators 
for whether a bank holding company is a SIFI in each quarter from the 
third in 2010 through the second in 2013, and other variables 
controlling for size, foreign exposure, securitization income, other 
nontraditional income, and participation in the Troubled Asset Relief 
Program. Estimated changes are the coefficients on the indicators for 
whether a bank holding company is a SIFI in quarters from the third in 
2010 through the second in 2013. We used t-tests to assess whether the 
coefficient on the SIFI indicator was significant at the 5 percent 
level. **=estimate is statistically significant at the 5 percent 
level. Parentheses contain the standard errors of the estimated 
changes. Square brackets contain the within R-squareds for each 
regression. 

[End of table] 

[End of section] 

Appendix VIII: Dodd-Frank Rules Implementing Central Clearing, 
Capital, and Margin Swap Reforms: 

The following tables list select Dodd-Frank rules that implement 
sections of Title VII related to central clearing requirements for 
swaps and security-based swaps, and margin and capital requirements 
for swaps entities, as of November 15, 2013. 

Table 15: Select Dodd-Frank Rules Implementing Central Clearing Swap 
Reforms Final as of November 15, 2013: 

Rulemaking: Process for Review of Swaps for Mandatory Clearing; 
Responsible regulator: CFTC; 
Published date: 7/25/2011; 
Effective date: 9/26/2011. 

Rulemaking: DCO operations, standards, and risk management; 
Responsible regulator: CFTC; 
Published date: 11/8/2011; 
Effective date: 1/9/2012. 

Rulemaking: Derivatives Clearing Organization General Provisions and 
Core Principles; 
Responsible regulator: CFTC; 
Published date: 11/8/2011; 
Effective date: 1/9/2012. 

Rulemaking: Customer Clearing Documentation, Timing of Acceptance for 
Clearing, and Clearing Member Risk Management; 
Responsible regulator: CFTC; 
Published date: 4/9/2012; 
Effective date: 10/1/2012. 

Rulemaking: Process for Submissions for Review of Security-Based Swaps 
for Mandatory Clearing and Notice Filing Requirements for Clearing 
Agencies; 
Responsible regulator: SEC; 
Published date: 7/13/2012; 
Effective date: 8/13/2012. 

Rulemaking: End-User Exception to the Clearing Requirement for Swaps; 
Responsible regulator: CFTC; 
Published date: 7/19/2012; 
Effective date: 9/17/2012. 

Rulemaking: Swap Transaction Compliance and Implementation Schedule: 
Clearing Requirement under Section 2(h) of the CEA; 
Responsible regulator: CFTC; 
Published date: 7/30/2012; 
Effective date: 9/28/2012. 

Rulemaking: Clearing Agency Standards; 
Responsible regulator: SEC; 
Published date: 11/22/2012; 
Effective date: 1/2/2013. 

Rulemaking: Clearing Requirement Determination Under Section 2(h) of 
the CEA; 
Responsible regulator: CFTC; 
Published date: 12/13/2012; 
Effective date: 2/11/2013. 

Rulemaking: Clearing Exemption for Swaps Between Certain Affiliated 
Entities; 
Responsible regulator: CFTC; 
Published date: 4/11/2013; 
Effective date: 6/10/2013. 

Source: GAO analysis of Dodd-Frank Act, Federal Register documents. 

Note: SEC has not yet proposed rules requiring central clearing for any 
security-based swap. 

[End of table] 

[End of table] 

Table 16: Select Dodd-Frank Rules Implementing Capital and Margin Swap 
Reforms Proposed as of November 15, 2013: 

Rulemaking: Margin Requirements for Uncleared Swaps for Swap Dealers 
and Major Swap Participants; 
Responsible regulator: CFTC; 
Rule status: Proposed; 
Published date: 4/28/2011. 

Rulemaking: Margin and Capital Requirements for Covered Swap Entities; 
Responsible regulator: FCA, FDIC, FHFA, FRS, OCC; 
Rule status: Proposed; 
Published date: 5/11/2011. 

Rulemaking: Capital Requirements of Swap Dealers and Major Swap 
Participants; 
Responsible regulator: CFTC; 
Rule status: Proposed; 
Published date: 5/12/2011. 

Rulemaking: Swap Transaction Compliance and Implementation Schedule: 
Trading Documentation and Margining Requirements under Section 4s of 
the CEA; 
Responsible regulator: CFTC; 
Rule status: Proposed; 
Published date: 9/20/2011. 

Rulemaking: Capital, Margin, and Segregation Requirements for Security-
Based Swap Dealers and Major Security-Based Swap Participants and 
Capital Requirements for Broker-Dealers; Proposed Rule; 
Responsible regulator: SEC; 
Rule status: Proposed; 
Published date: 11/23/2012. 

Source: GAO analysis of Dodd-Frank Act and Federal Register documents. 

[End of table] 

[End of section] 

Appendix IX: Comments from the Financial Stability Oversight Council: 

Department Of The Treasury: 
Under Secretary: 
Washington, D.C. 

November 20, 2013: 

Ms. A. Nicole Clowers: 
Director, Financial Markets and Community Investment: 
Government Accountability Office: 
441 G St., NW: 
Washington, D.C. 20548: 

Dear Ms. Clowers: 

I am writing on behalf of Secretary Lew, who serves as the Chairperson 
of the Financial Stability Oversight Council (Council). We appreciate 
the opportunity to review the Government Accountability Office's (GAO) 
draft report GAO-14-67 (the Draft Report) regarding regulatory 
analysis and coordination to implement the Dodd-Frank Wall Street 
Reform and Consumer Protection Act (Dodd-Frank Act). 

The Draft Report's findings make clear that federal financial 
regulatory agencies are effectively coordinating and collaborating on 
the implementation of the Dodd-Frank Act. As the Draft Report notes, 
these agencies recognize the importance of interagency coordination 
and have exceeded the coordination and consultation requirements of 
the Dodd-Frank Act by engaging in numerous instances of voluntary 
regulatory coordination. These instances generally occurred when a 
member agency's rules could affect another agency or entities 
supervised by that other agency, or when the other agency has 
expertise that could inform the rulemaking. The Draft Report also 
notes that the Council, or its Chairperson, has fulfilled the 
coordination or consultative roles for implementation activities 
required by the Dodd-Frank Act. 

The Council has taken a variety of actions to facilitate coordination 
and consultation among financial regulators. For example, the Council 
has written protocols for coordination on rules when such action is 
required under the Dodd-Frank Act. For these and other Dodd-Frank Act 
rulemakings, the Council's Deputies Committee, composed of senior 
representatives of the Council's members, and six functional 
committees, provide forums in which agencies coordinate and consult 
with each other. The Deputies Committee meets every two weeks to 
discuss the Council's agenda and coordinate and oversee the work of 
the functional committees. The results of the Draft Report demonstrate 
that these efforts have been successful even though Congress did not 
provide the Council or its Chairperson with authority to require its 
member agencies to coordinate in all cases. In addition to its ongoing 
efforts, the Council continually seeks ways to further enhance 
collaboration through its committees and working groups. 

Thank you again for the opportunity to review and comment on the Draft 
Report. We support GAO's important oversight function and look forward 
to working with you in the future. 

Sincerely, 

Signed by: 

Mary J. Miller: 

[End of section] 

Appendix X: Comments from the National Credit Union Administration: 

National Credit Union Administration: 
1775 Duke Street: 
Alexandria, VA 22314-3428: 
703-518-6300: 

November 15, 2013: 

Rich Tsuhara: 
Assistant Director, Financial Markets and Community Investment: 
U.S. Government Accountability Office: 
441 G Street, NW: 
Washington, D.C. 20548: 

Dear Mr. Tsuhara: 

We reviewed the U.S. General Accountability Office's report entitled 
Dodd-Frank Regulations: Agencies Conducted Regulatory Analyses and 
Coordinated but Could Benefit from Additional Guidance on Major Rules 
(GAO-14-67). 

We agree with your conclusion that financial regulators, including 
NCUA, have considerable work underway to implement the requirements of 
the Dodd-Frank Act reforms that could help improve the U.S. financial 
system. We also support the primary recommendation the Office of 
Management and Budget issue additional guidance to help standardize 
processes for identifying major rules under the Congressional Review 
Act. 

Thank you for the opportunity to comment. 

Sincerely, 

Signed by: [Illegible] for: 

Mark Treichel: 
Executive Director: 

[End of section] 

Appendix XI: GAO Contact and Acknowledgments: 

GAO Contact: 

A. Nicole Clowers, (202) 512-8678, clowersa@gao.gov: 

Staff Acknowledgments: 

In addition to the contact named above, Richard Tsuhara (Assistant 
Director), Silvia Arbelaez-Ellis, Timothy Bober, William R. Chatlos, 
Jeremy Conley, Rachel DeMarcus, Courtney LaFountain, Thomas McCool, 
Marc Molino, Patricia Moye, Barbara Roesmann, and Susan Offutt made 
key contributions to this report. 

[End of section] 

Footnotes: 

[1] Pub. L. No. 111-203, 124 Stat. 1376 (2010). We identified 236 
provisions of the Dodd-Frank Act that require regulators to issue 
rulemakings across nine key areas. See GAO, Financial Regulatory 
Reform: Regulators Have Faced Challenges Finalizing Key Reforms and 
Unaddressed Areas Pose Potential Risks, [hyperlink, 
http://www.gao.gov/products/GAO-13-195] (Washington, D.C.: Jan. 23, 
2013). 

[2] For example, see GAO, Financial Regulatory Reform: Financial 
Crisis Losses and Potential Impact of the Dodd-Frank Act, [hyperlink, 
http://www.gao.gov/products/GAO-13-180] (Washington, D.C.: Jan. 16, 
2013). 

[3] We use the term "federal financial regulators" to refer to the 
Consumer Financial Protection Bureau, Commodity Futures Trading 
Commission, Federal Deposit Insurance Corporation, Board of Governors 
of the Federal Reserve System, Office of the Comptroller of the 
Currency, National Credit Union Administration, and Securities and 
Exchange Commission. 

[4] Paperwork Reduction Act of 1995, Pub. L. No. 104-13, 109 Stat. 163 
(1995) (codified as amended at 44 U.S.C. §§ 3501-3520); Regulatory 
Flexibility Act, Pub. L. No. 96-354, 94 Stat. 1164 (1980) (codified as 
amended at 5 U.S.C. §§ 601-612). 

[5] Pub. L. No. 104-121, Tit. II, § 251, 110 Stat. 868 (1996) 
(codified at 5 U.S.C. §§ 801-808). As defined by CRA, a major rule is 
a rule that OMB finds has resulted in or is likely to result in (1) an 
annual effect on the economy of $100 million or more; (2) a major 
increase in costs or prices; or (3) significant adverse effects on 
competition, employment, investment, productivity, innovation, or on 
the ability of U.S.-based enterprises to compete with foreign-based 
enterprises in domestic and export markets. 5 U.S.C. § 804(2). CRA 
requires agencies to submit to both houses of Congress and the 
Comptroller General, before rules can become effective, a report 
containing (i) a copy of the rule, (ii) a concise general statement 
relating to the rule, including whether it is a major rule, and (iii) 
the proposed effective date of the rule. 5 U.S.C. § 801(a)(1)(A). 
Rules not classified as major take effect as otherwise provided by law 
after submission to Congress, while rules classified as major take 
effect on the later of 60 days after Congress receives the rule 
report, or 60 days after the rule is published in the Federal 
Register, as long as Congress does not pass a joint resolution of 
disapproval. 5 U.S.C. § 801(a)(3), (4). CRA also mandates that we 
provide a report to Congress that includes an assessment of an 
agency's compliance with the CRA process. We do not analyze or comment 
on the substance or quality of rulemaking. We must report to each 
house of Congress by the end of 15 calendar days after a rule's 
submission or publication date. 5 U.S.C. § 801(a)(2)(A). 

[6] Exec. Order No. 12,866, 58 Fed. Reg. 51,735 (Sept. 30, 1993). 

[7] Independent regulatory agencies are those defined by 44 U.S.C. § 
3502(5). This statutory definition was revised by the Dodd-Frank Act 
to include the Office of the Comptroller of the Currency, the Bureau 
of Consumer Financial Protection, and the Office of Financial Research. 

[8] Pub. L. No. 112-10, § 1573(a), 125 Stat. 38, 138-39 (2011) 
(codified at 12 U.S.C. § 5496b). We are directed to analyze (1) the 
impact of regulation on the financial marketplace, including the 
effects on the safety and soundness of regulated entities, cost and 
availability of credit, savings realized by consumers, reductions in 
consumer paperwork burden, changes in personal and small business 
bankruptcy filings, and costs of compliance with rules, including 
whether relevant federal agencies are applying sound cost-benefit 
analysis in promulgating rules; (2) efforts to avoid duplicative or 
conflicting rulemakings, information requests, and examinations; and 
(3) other matters deemed appropriate by the Comptroller General. The 
focus of our reviews is on the financial regulations promulgated 
pursuant to the Dodd-Frank Act. 

[9] GAO, Dodd-Frank Act Regulations: Implementation Could Benefit from 
Additional Analyses and Coordination, [hyperlink, 
http://www.gao.gov/products/GAO-12-151] (Washington, D.C.: Nov. 10, 
2011), and Dodd-Frank Act Regulations: Agencies' Efforts to Analyze 
and Coordinate Their Rules, [hyperlink, 
http://www.gao.gov/products/GAO-13-101] (Washington, D.C.: Dec. 18, 
2012). 

[10] As independent regulatory agencies that are not required to 
follow the economic analysis requirements of E.O. 12,866, the 
financial regulators also are not required to follow OMB Circular A-4. 
However, Circular A-4 is an example of best practices for agencies to 
follow when conducting regulatory analyses, and the financial 
regulators have told us that they follow the guidance in spirit. 

[11] To compile information on all the rules submitted under CRA, we 
established a database and created a standardized submission form to 
allow more consistent information collection. Our Federal Rules 
database is publicly available at [hyperlink, http://www.gao.gov] 
under Legal Decisions & Bid Protests. 

[12] The Dodd-Frank Act does not use the term "systemically important 
financial institution" (SIFI). This term is commonly used by academics 
and other experts to refer to bank holding companies with $50 billion 
or more in total consolidated assets and nonbank financial companies 
designated by the Financial Stability Oversight Council for Federal 
Reserve supervision and enhanced prudential standards under the Dodd-
Frank Act. For purposes of this report, we refer to these bank and 
nonbank financial companies as bank systemically important financial 
institutions (bank SIFI) and nonbank systemically important financial 
institutions (nonbank SIFI), respectively. We also refer to nonbank 
SIFIs and bank SIFIs collectively as SIFIs when appropriate. 

[13] A swap is a type of derivative that involves an ongoing exchange 
of one or more assets, liabilities, or payments for a specified 
period. Financial and nonfinancial firms use swaps and other over-the-
counter derivatives to hedge risk, or speculate, or for other 
purposes. Swaps include interest rate swaps, commodity-based swaps, 
and broad-based credit default swaps. Security-based swaps include 
single-name and narrow-based credit default swaps and equity-based 
swaps. For the purposes of this report, we use "swaps" to refer to 
both "swaps" and "security-based swaps." 

[14] Bank Holding Company Act of 1956, Pub. L. No. 84-511, 70 Stat. 
133 (1956) (codified as amended at 12 U.S.C. §§ 1841-1852); Home 
Owners' Loan Act, Pub. L. No. 73-43, 48 Stat. 128 (1933) (codified as 
amended at 12 U.S.C. §§ 1461-1470). Bank holding companies are 
companies that own or control a bank, as defined in the Bank Holding 
Company Act. 12 U.S.C. § 1841(a)(1), (c). Savings and loan holding 
companies are companies that directly or indirectly control a savings 
association. 12 U.S.C. § 1467a(a)(1)(D). 

[15] For a more detailed discussion of the regulatory framework for 
bank holding companies and savings and loan holding companies, see 
GAO, Bank Holding Company Act: Characteristics and Regulation of 
Exempt Institutions and the Implications of Removing the Exemptions, 
[hyperlink, http://www.gao.gov/products/GAO-12-160] (Washington, D.C.: 
Jan. 19, 2012). 

[16] Certain securities activities also are overseen by state 
government entities. 

[17] Futures commission merchants are individuals, associations, 
partnerships, corporations, and trusts that solicit or accept orders 
for the purchase or sale of a commodity for future delivery, among 
other products, on or subject to the rules of any exchange and that 
accept payment from or extend credit to those whose orders are 
accepted. 7 U.S.C. § 1a(28). Firms and individuals who trade futures 
with the public or give advice about futures trading must be 
registered with the National Futures Association, the industrywide 
self-regulatory organization for the U.S. futures industry. 

[18] 12 U.S.C. §§ 5481-5603. 

[19] These agencies included the Federal Reserve, FDIC, Federal Trade 
Commission, Department of Housing and Urban Development, NCUA, the 
Office of the Comptroller of the Currency, and Office of Thrift 
Supervision. 

[20] 12 U.S.C. §§ 5321-5333. For additional information on FSOC and 
the Office of Financial Research see GAO, Financial Stability: New 
Council and Research Office Should Strengthen the Accountability and 
Transparency of Their Decisions, [hyperlink, 
http://www.gao.gov/products/GAO-12-886] (Washington, D.C.: Sept. 11, 
2012). 

[21] Paperwork Reduction Act of 1995, Pub. L. No. 104-13, 109 Stat. 
163 (1995) (codified as amended at 44 U.S.C. §§ 3501-3520); Regulatory 
Flexibility Act, Pub. L. No. 96-354, 94 Stat. 1164 (1980) (codified as 
amended at 5 U.S.C. §§ 601-612). PRA requires agencies to justify any 
collection of information from the public to minimize the paperwork 
burden the collection imposes and to maximize the practical utility of 
the information collected. 44 U.S.C. § 3504. RFA requires federal 
agencies to (1) assess the impact of their regulation on small 
entities, including businesses, governmental jurisdictions, and 
certain not-for-profit organizations with characteristics set forth in 
the act, and (2) consider regulatory alternatives to lessen the 
regulatory burden on small entities. 5 U.S.C. § 603. 

[22] However, RFA requires agencies to discuss alternatives in the 
course of a final regulatory flexibility analysis. The analysis must 
include "a description of the steps the agency has taken to minimize 
the significant economic impact on small entities consistent with the 
stated objectives of applicable statutes, including a statement of the 
factual, policy, and legal reasons for selecting the alternative 
adopted in the final rule and why each one of the other significant 
alternatives to the rule considered by the agency which affect the 
impact on small entities was rejected." 5 U.S.C. § 604(a)(6). 

[23] § 15(a), 42 Stat. 998 (1922) (codified as amended at 7 U.S.C. § 
19(a)). 

[24] Pub. L. No. 111-203, Tit. X, § 1022(b)(2) (codified at 12 U.S.C. 
§ 5512(b)(2)). 

[25] Id. 

[26] 5 U.S.C. § 603(d). 

[27] Pub. L. No. 104-290, § 106(a)-(c), 110 Stat. 3416, 3424 (1996) 
(codified as amended at 15 U.S.C. §§ 77b(b), 78c(f), 80a-2(c)). 
Conforming amendments to the Investment Advisers Act of 1940 were made 
in section 224 of the Gramm Leach Bliley Act. Pub. L. No. 106-102, § 
224, 113 Stat. 1338, 1402 (1999) (codified at 15 U.S.C. § 80b-2(c)). 

[28] § 23(a)(2), 48 Stat. 881 (1934) (codified as amended at 15 U.S.C. 
§ 78w(a)(2)). 

[29] 15 U.S.C. § 1693b(a)(2). 

[30] Exec. Order No. 12,866, 58 Fed. Reg. 51,735 (Sept. 30, 1993). For 
significant rules, the order further requires agencies to prepare a 
detailed regulatory (or economic) analysis of both the benefits and 
costs. More recently, E.O. 13,563 supplemented E.O. 12,866, in part by 
incorporating its principles, structures, and definitions. Exec. Order 
No. 13,563, 76 Fed. Reg. 3821 (Jan. 18, 2011). E.O. 12,866 contains 12 
principles of regulation that direct agencies to perform specific 
analyses to identify the problem to be addressed, assess its 
significance, assess both the benefits and costs of the intended 
regulation, design the regulation in the most cost-effective manner to 
achieve the regulatory objective, and base decisions on the best 
reasonably obtained information available. 

[31] OMB, Circular A-4: Regulatory Analysis, September 17, 2003. 
Circular A-4 refined OMB's "best practices" guidance issued in 1996 
and 2000. Executive Order 13,579 (E.O. 13,579) encourages independent 
regulatory agencies to comply with E.O. 13,563. Exec. Order No. 
13,579, 76 Fed. Reg. 41,587 (July 14, 2011). 

[32] [hyperlink, http://www.gao.gov/products/GAO-12-151]. 

[33] In April 2013, FDIC updated a statement of policy in the 
development and review of its regulations and policies. In October 
2011, OCC updated its guidance for rulemaking procedures. In March 
2012, SEC revised its guidance for conducting economic analysis in SEC 
rulemakings. All the documents incorporate principles for economic 
benefit-cost analysis set forth in OMB Circular A-4. 

[34] In this report, we use the terms "rules", "regulations", or 
"rulemakings" generally to refer to Federal Register notices of agency 
action pursuant to the Dodd-Frank Act, including regulations, 
interpretive rules, general statements of policy, guidance, and rules 
that deal with agency organization, procedure, or practice. 

[35] [hyperlink, http://www.gao.gov/products/GAO-13-101]. 

[36] See 5 U.S.C. §§ 801-802. 

[37] 5 U.S.C. §§ 801(b), 802. Since 1996, 43 resolutions have been 
introduced in the Senate or House of Representatives and two of those 
resolutions have passed one house of Congress. Only the Department of 
Labor's rule on ergonomics (65 Fed. Reg. 68,262 (Nov. 14, 2000)) has 
been disapproved by both houses of Congress and signed by the 
President. See Pub. L. No. 107-5, 115 Stat. 7 (2001). 

[38] OMB, Memorandum 99-13 (Mar. 30, 1999). The memorandum notes that 
CRA applies to every executive branch "agency" as defined in 5 U.S.C. 
§ 551(1). This definition, from the Administrative Procedure Act, 
includes the independent regulatory commissions and boards. In some 
areas, the memorandum provides different guidance for rules subject to 
E.O. 12,866 and rules not subject to the order. In this report, we 
generally refer to agencies subject to E.O. 12,866 as executive branch 
agencies and agencies not subject to the order as independent 
regulatory agencies. 

[39] 77 Fed. Reg. 48,208 (Aug. 13, 2012). 

[40] 77 Fed. Reg. 30,596 (May 23, 2012). 

[41] 77 Fed. Reg. 21,637 (Apr. 11, 2012). 

[42] Treasury officials further noted that the actual designation of a 
nonbank financial company is done on a company-by-company basis in 
which FSOC members analyze whether a particular company could pose a 
threat to the financial stability of the United States and then vote 
to determine whether the company shall be subject to Federal Reserve 
supervision. A proposed or final determination requires the vote of no 
fewer than two-thirds of voting FSOC members, including an affirmative 
vote by the FSOC chairperson. FSOC must provide a written notice of 
the proposed determination to the nonbank financial company, including 
an explanation of the basis of the proposed determination. The nonbank 
financial company may request a hearing to contest the proposed 
determination in accordance with 12 U.S.C. § 5323(e) and 12 C.F.R. § 
1310.21(c). 

[43] 78 Fed. Reg. 10,696 (Feb. 14, 2013); 78 Fed. Reg. 10,902 (Feb. 
14, 2013). Regulation X implements the Real Estate Settlement 
Procedures Act of 1974 and Regulation Z implements the Truth in 
Lending Act. The CFPB rules, issued concurrently, amended the 
regulations and implemented provisions of the Dodd-Frank Act regarding 
mortgage loan servicing. 

[44] CFPB officials told us that the two rules had been considered 
together in the rulemaking process and were issued on the same date, 
and that CFPB had combined the CRA analysis of the rules as a matter 
of efficiency. CFPB officials also told us that CFPB would provide OMB 
with separate CRA estimates for each individual rule in the future. 

[45] 76 Fed. Reg. 42,950 (July 19, 2011). 

[46] OMB, Regulatory Impact Analysis: Frequently Asked Questions 
(FAQ), accessed on Nov. 13, 2013, [hyperlink, 
http://www.whitehouse.gov/omb/inforeg_regpol_agency_review]. 

[47] [hyperlink, http://www.gao.gov/products/GAO-13-101]. 

[48] In five of its final rules, CFPB noted in the Federal Register 
releases that although it was unclear about the applicability of the 
Dodd-Frank coordination requirement to the rules, the agency consulted 
or coordinated with other regulators as the act would require if 
applicable. When we refer to the 39 rules where coordination was 
required, we include these 5 CFPB rules. 

[49] CFTC and SEC subject to requirements in the Dodd-Frank Act to 
issue certain rules jointly. For this review period, CFTC issued 18 
rules, SEC issued 9 rules, and they jointly issued 2 rules. The 
agencies were not required to coordinate under Title VII for all of 
the rules because, for example, the rules were not related to swaps. 

[50] CFPB issued 19 rules during this review period, including 2 joint 
rules with the Federal Reserve. CFPB coordinated on 17 rules; the 
other 2 rules were a technical amendment and guidance to which CFPB 
found the coordination requirement did not apply. 

[51] We did not find evidence of interagency coordination for 21 of 
the rules we reviewed. The regulatory agencies were not required to 
coordinate or did not coordinate, as they determined based on their 
discretion, on these rules. Agency officials said that some rules were 
technical in nature and no coordination was needed. For example, 
officials said some rules were adjustments to existing rules to make 
them compatible with newly issued rules under the Dodd-Frank Act. 
Additionally, officials said that some rules were internal and, thus, 
the agency did not coordinate with other agencies. Examples include 
rules establishing disclosure requirements or improving recordkeeping 
standards for supervised entities. We did not evaluate the agencies' 
rationale for not voluntarily coordinating. 

[52] Not all rules issued by CFTC or SEC required international 
coordination under Title VII of the Dodd-Frank Act. Some of the rules 
were not related to swaps. For other rules, the agency issuing the 
rule determined that international coordination was not necessary. For 
example, officials stated or the rules explained that the agencies did 
not engage in coordination with foreign regulators because their rules 
were consistent with rules promulgated by foreign regulators, 
recommendations issued by international entities, or international 
standards. 

[53] The International Organization of Securities Commissions' OTC 
Derivatives Regulation Task Force coordinates securities and futures 
regulators' efforts in the supervision and oversight of OTC 
derivatives markets. The Financial Stability Board's OTC Derivatives 
Working Group monitors global implementation of OTC derivatives 
reforms agreed upon by the G20 members. The OTC Derivatives 
Regulators' Forum is comprised of international financial regulators 
that have direct authority over OTC derivatives markets. This group 
meets periodically to exchange views and share information on 
developments related to OTC derivatives markets. GAO will be issuing a 
report on international regulatory reforms that will discuss U.S. 
regulators' participation in international swap reform efforts. 

[54] According to CFTC staff, CFTC cooperates with foreign regulatory 
authorities on a routine basis, both informally and through MOUs and 
other arrangements. For a list of these agreements, see [hyperlink, 
http://www.cftc.gov/international/memorandaofunderstanding/index.htm]. 
CFTC staff told us that as CFTC issues new regulations related to OTC 
derivatives reform, staff have developed supervisory cooperation 
arrangements with foreign authorities in major jurisdictions where 
regulated entities are located. Staff currently are negotiating 
arrangements with the European Securities and Markets Authority and 
authorities in the United Kingdom, Germany, Canada, Australia, 
Singapore, and Japan, and expect to negotiate arrangements with 
authorities in other jurisdictions. SEC staff said that SEC has signed 
MOUs with foreign jurisdictions, including European Securities and 
Markets Authority and authorities in the United Kingdom, Germany, 
China, and Turkey. 

[55] [hyperlink, http://www.gao.gov/products/GAO-12-151]. 

[56] [hyperlink, http://www.gao.gov/products/GAO-12-151]. 

[57] Who Is Too Big to Fail? GAO's Assessment of the Financial 
Stability Oversight Council and the Office of Financial Research: 
Hearing before the Subcomm. On Oversight and Investigations of the H. 
Comm. on Financial Services. 113th Cong. 4 (2013) (statement of Amias 
M. Gerety, Deputy Assistant Secretary, Financial Stability Oversight 
Council, U.S. Department of the Treasury). 

[58] See sections 1024 and 1025 of the act for CFPB's authority to 
supervise nonbanks and large banks, respectively. Pub. L. No. 111-203, 
§§ 1024, 1025 (codified at 12 U.S.C. §§ 5514, 5515). Under section 
1025 of the Dodd-Frank Act, CFPB has exclusive examination authority 
and primary enforcement authority with respect to a bank or credit 
union with total assets of more than $10 billion and its affiliates 
and service providers for purposes of assessing compliance with 
federal consumer financial laws and related purposes. 12 U.S.C. § 
5515. Section 1026 provides that the prudential regulators will retain 
supervisory and enforcement authority with respect to other banks for 
these purposes. 12 U.S.C. § 5516. Section 1024 authorizes CFPB to 
supervise certain nondepository entities and individuals who offer or 
provide mortgage-related products or services, payday loans, private 
student loans, and larger participants of other consumer financial 
service or product markets as CFPB defines by rule, among others, plus 
their service providers. 12 U.S.C. § 5514. Under section 1026, CFPB 
may include its examiners on a sampling basis at the appropriate 
prudential regulator's examinations of smaller banks to assess 
compliance with the requirements of federal consumer financial law. 12 
U.S.C. § 5516(c)(1). Additionally, under section 1026, CFPB has 
supervisory authority over a service provider to a substantial number 
of smaller banks. 12 U.S.C. § 5516(e). Under section 1029, CFPB may 
not exercise any authority over certain dealers, subject to exception, 
that are predominantly engaged in the servicing and sale or leasing of 
motor vehicles. 12 U.S.C. § 5519(a). 

[59] In November 2011, CFPB and the prudential regulators issued an 
interagency statement explaining that the agencies will use bank Call 
Reports to determine a bank's asset size for determining which 
regulator supervises the bank for compliance with federal consumer 
financial laws. The agencies initially will look to June 30, 2011, 
Call Report data to determine a bank's asset size. Thereafter, CFPB 
will become a bank's federal consumer protection law regulator once 
the bank has reported total assets of greater than $10 billion for 
four consecutive quarters, and, similarly, a bank will not cease to be 
regulated by CFPB for such purposes unless it has reported total 
assets of $10 billion or less for four consecutive quarters. 

[60] 12 U.S.C. § 5515(b)(2), (e)(1). 

[61] 12 U.S.C. § 5515(b)(2), (3). 

[62] CFPB also is a member of the Federal Financial Institutions 
Examination Council, a formal interagency body empowered to prescribe 
uniform principles, standards, and report forms for the federal 
examination of financial institutions. As such, CFPB officials told us 
that CFPB coordinates its examination procedures with those used by 
the prudential regulators. 

[63] CFPB, Memorandum of Understanding on Supervisory Coordination, 
accessed on November 13, 2013, [hyperlink, 
http://www.consumerfinance.gov/f/201206_CFPB_MOU_Supervisory_Coordinatio
.pdf]. 

[64] Under the MOU, a simultaneous examination generally is one where 
material portions of the examinations by the prudential regulator and 
CFPB are conducted during a concurrent time period and may be carried 
out either on-site or off-site by either regulator. However, the 
examinations are not required to be carried out jointly. 

[65] To facilitate information sharing among regulators, section 
1022(c)(6) of the act gives CFPB, upon providing reasonable assurances 
of confidentiality, access to any report of examination or financial 
condition made by a prudential regulator or other federal agency 
having jurisdiction over a supervised entity or service provider, and 
provides that prudential regulators may, in their discretion, furnish 
to CFPB any other report or other confidential supervisory information 
on those entities. 12 U.S.C. § 5512(c)(6)(B). The prudential 
regulators are accorded the same access to CFPB reports and 
confidential supervisory information. 12 U.S.C. § 5512(c)(6)(C). To 
this end, CFPB also has signed information-sharing MOUs with each of 
the prudential regulators that provide the regulators with reasonable 
assurances that supervisory information will be treated in a 
confidential manner. 

[66] CFPB, CFPB Supervision and Examination Manual, version 2, October 
2012. The examination cycle for nonbanks is largely similar to that of 
large banks, except for the monitoring phase. CFPB continuously 
monitors each large bank and its affiliates under its jurisdiction. In 
contrast, CFPB does not continuously monitor nonbanks but instead uses 
a risk-based analysis to determine which nonbank entities to examine. 

[67] The Supervision and Examination System is an internal CFPB system 
that is used to document the supervision process. The system 
facilitates the creation of schedules, capture of examination 
information, documentation of the examination process, storage of 
documents, and ability to run monitoring reports. 

[68] According to CFPB's manual, during an examination, examiners 
collect and review information from the supervised entity to reach 
conclusions about its practices, its compliance management, and its 
compliance with specific laws and regulations. The records documenting 
the review are called workpapers. Workpapers should contain sufficient 
information and supporting documents to explain the basis for the 
examination conclusions. 

[69] While prudential regulators do not have access to the Supervision 
and Examination System, CFPB may share information in the system with 
other regulators to fulfill its coordination requirements under the 
act. As mentioned earlier, CFPB and prudential regulators have entered 
into information-sharing MOUs that provide the regulators with 
reasonable assurances that supervisory information will be treated in 
a confidential manner. CFPB staff stated that CFPB shares information 
with regulators through secure channels, such as online portals or 
through encrypted email. 

[70] CFPB has the authority to supervise certain nonbanks in the 
residential mortgage, private education lending, and payday lending 
markets. CFPB also has the authority to supervise nonbank ''larger 
participants'' of markets for other consumer financial products or 
services, as CFPB defines by rule. 12 U.S.C. § 5514(a)(1). In July 
2012 and October 2012, CFPB published final rules defining larger 
participants of a market for consumer reporting and debt collection 
markets, respectively. 77 Fed. Reg. 42,874 (July 20, 2012); 77 Fed. 
Reg. 65,775 (Oct. 31, 2012). CFPB issued a final rule defining larger 
participants in the student loan servicing market on December 3, 2013 
(not yet published in the Federal Register). 

[71] See 12 U.S.C. §§ 5514(b)(3), 5515(b)(2). 

[72] See 12 U.S.C. §§ 5514(b)(3), 5515(b)(2), (e)(2). 

[73] See 12 U.S.C. §§ 5514(b)(4), 5515(b)(3). As with prudential 
regulators, to facilitate information sharing among regulators, 
section 1022(c)(6)(C) of the act gives regulators having jurisdiction 
over a covered person or service provider, including state regulators, 
access to any report of examination made by CFPB with respect to that 
supervised entity or service provider, upon providing reasonable 
assurances of confidentiality. 

[74] See 12 U.S.C. §§ 5512(c)(7)(C), 5514(b)(7)(D). 

[75] CSBS is the nationwide organization of banking regulators from 
all 50 states, the District of Columbia, Guam, Puerto Rico, and the 
U.S. Virgin Islands. Besides the MOU, on December 6, 2012, CFPB also 
issued a Statement of Intent for Sharing Information with state 
banking and financial services regulators that spells out specific 
items that CFPB intends to share with state regulators, including 
examination schedules, examination reports, consumer complaint 
information, among others. 

[76] Specifically, in the January 2011 MOU, CFPB and CSBS agreed to 
consult on the practices used by the state regulators in examining 
providers of consumer financial products and services. CSBS agreed to 
provide CFPB with information furnished to it by state regulators and 
other relevant multistate bodies on examination processes, including 
examination manuals, standardized information requests, and 
examination procedures. Additionally, CFPB, CSBS, and state regulators 
agreed to consult on and jointly develop training programs for 
examiners. 

[77] Under the framework, CFPB, state banking regulators, and the 
State Coordinating Committee are to establish a point of contact for 
each supervised entity, share examination schedules annually and 
review them at least quarterly, and have a joint examiner-in-charge, 
if appropriate. In addition, points of contact are instructed to 
develop and update a supervision plan for each supervised entity 
tailored to the entity's organizational structure and risk profile. 
Lastly, the framework directs CFPB and the State Coordinating 
Committee to compile annual lists of all covered nonbank entities and 
nonbank entities subject to examination. 

[78] The Nationwide Mortgage Licensing System is a web-based system 
that allows state licensed mortgage lenders, mortgage brokers, and 
loan officers to apply for, amend, update, or renew a license online 
for all participating state agencies using a single set of uniform 
applications. Mortgage loan originators are required by the SAFE 
Mortgage Licensing Act of 2008 to be state licensed or registered 
through the Nationwide Mortgage Licensing System. Pub. L. No. 110-289, 
Div. A, Tit. V, § 1504(a), 122 Stat. 2810 (2008) (codified at 12 
U.S.C. § 5103(a)). 

[79] With the implementation of updated uniform Nationwide Mortgage 
Licensing System licensing forms, state regulatory agencies in 
Massachusetts, Oklahoma, Rhode Island, Vermont, and Washington are 
managing license authorities covering a range of industries, including 
money transmitters, debt collectors, and sales finance companies. 

[80] See [hyperlink, http://www.gao.gov/products/GAO-13-101]. The Dodd-
Frank Act does not use the term "systemically important financial 
institution" (SIFI). This term is commonly used by academics and other 
experts to refer to bank holding companies with $50 billion or more in 
total consolidated assets and nonbank financial companies designated 
by the Financial Stability Oversight Council for Federal Reserve 
supervision and enhanced prudential standards under the Dodd-Frank 
Act. For purposes of this report, we refer to these bank and nonbank 
financial companies as bank systemically important financial 
institutions (bank SIFI) and nonbank systemically important financial 
institutions (nonbank SIFI), respectively. We also refer to nonbank 
SIFIs and bank SIFIs collectively as SIFIs when appropriate. 

[81] S. Rep. No. 111-176 (2010). 

[82] 77 Fed. Reg. 594 (Jan. 5, 2012); 77 Fed. Reg, 76,628 (Dec. 28, 
2012). See appendix V for a summary of select finalized SIFI-related 
rulemakings. 

[83] See [hyperlink, http://www.gao.gov/products/GAO-13-101]. 

[84] Our analyses of bank SIFIs include U.S. bank holding companies 
with total consolidated assets of $50 billion or more and foreign bank 
organizations' U.S.-based bank holding company subsidiaries that on 
their own have total consolidated assets of $50 billion or more. 

[85] The Basel Committee has agreed on a new set of risk-based 
capital, leverage, liquidity, and other requirements for banking 
institutions (Basel III requirements). Additionally, the Financial 
Stability Board and the Basel Committee have agreed on new capital and 
other requirements applicable to designated globally systemically 
important banks (G-SIB requirements). U.S. banking regulators have 
implemented some of these requirements, and the Federal Reserve has 
indicated its intention to base some of the SIFI enhanced prudential 
standards on the Basel III and G-SIB requirements. For more details 
see appendix V. 

[86] In our November 2012 report, we noted that there were seven large 
bank SIFIs as of the second quarter of 2012. Six of them continue to 
be large bank SIFIs as of the third quarter of 2013. In February 2013, 
the remaining one received regulatory approval to deregister as a bank 
holding company. 

[87] See appendix VII for more information on our econometric analysis. 

[88] See, for example, Basel Committee on Banking Supervision, An 
Assessment of the Long Term Economic Impact of Stronger Capital and 
Liquidity Requirements (Basel, Switzerland, August 2010), and Basel 
Committee on Banking Supervision and Financial Stability Board, 
Assessing the Macroeconomic Impact of the Transition to Stronger 
Capital and Liquidity Requirements (Basel, Switzerland, August 2010). 

[89] See appendix V for the rulemaking status of the enhanced 
prudential standards. 

[90] FSOC, Annual Report, 2011. 

[91] In general, minimum capital requirements are designed to provide 
firms with sufficient liquidity to meet unsubordinated obligations to 
customers and counterparties and sufficient resources to wind down in 
an orderly manner without the need for a formal proceeding. Minimum 
margin requirements are generally intended to regulate the amount of 
credit directed into swaps and related transactions and to help 
protect swaps entities and their customers from price fluctuations and 
against losses arising from undue leverage. Minimum margin 
requirements also can help manage counterparty credit risk. 

[92] Any entity acting as a clearinghouse, or central counterparty, 
must register with CFTC, SEC, or both, as appropriate (unless granted 
an exemption) and is subject to regulatory requirements established by 
CFTC, SEC, or both, as appropriate. 

[93] Organized exchanges and swap execution facilities are subject to 
comprehensive registration, and operational and self-regulatory 
requirements. 

[94] S. Rep. No. 111-176 (2010). 

[95] 77 Fed. Reg. 74,284 (Dec. 13, 2012). The types of interest rate 
swaps subject to mandatory clearing are fixed rate to floating rate 
swaps, floating rate to floating rate swaps, overnight index swaps, 
and forward rate agreements. The two types of CDSs subject to 
mandatory clearing are North American untranched CDS Indices and 
European untranched CDS Indices. 

[96] 77 Fed. Reg. 41,602 (July 13, 2012). 

[97] See Capital, Margin, and Segregation Requirements for Security-
Based Swap Dealers and Major Security-Based Swap Participants and 
Capital Requirements for Broker-Dealers, 77 Fed. Reg. 70,214 (Nov. 23, 
2012); Margin and Capital Requirements for Covered Swap Entities, 76 
Fed. Reg. 27,564 (May 11, 2011); Margin Requirements for Uncleared 
Swaps Dealers and Major Swap Participants, 76 Fed. Reg. 23,732 (Apr. 
28, 2011). 

[98] International Monetary Fund; Global Financial Stability Report: 
Meeting New Challenges to Stability and Building a Safer System (April 
2010). 

[99] See, for example, 77 Fed. Reg. 74,284 (Dec. 13, 2012). 

[100] The gross notional amount is the nominal or face amount that is 
used to calculate payments made on swaps. This amount generally does 
not change hands and is thus referred to as notional. 

[101] This indicator likely will be less than 100 percent because 
nonfinancial entities that use swaps to hedge or mitigate commercial 
risk are exempt from the clearing requirement. 

[102] Market participants may also substitute away from swaps subject 
to a clearing mandate to centrally cleared futures contracts, and the 
overall percentage of centrally cleared swaps and futures contracts 
will not be captured by this indicator. 

[103] This indicator likely will be less than 100 percent in part 
because some customized swaps will not be required to clear. 

[104] As discussed, SEC has not yet subjected any security-based swaps 
to a mandatory clearing requirement. 

[105] Importantly, the data represent the global market and, according 
to CFTC staff, likely include swaps not under CFTC's regulatory 
jurisdiction. In addition, CFTC staff told us that the proposed 
version of the Swap Reports currently does not include data from one 
swap data repository. CFTC staff told us that the final version of the 
CFTC Swaps Report will represent only those swaps that are under 
CFTC's regulatory jurisdiction. In updating our clearing indicators in 
the future, we plan to use data from the final version of CFTC's Swap 
Report. If significant differences exist between the data in the 
proposed and final Swaps Reports, this year's indicators may not serve 
as a useful baseline, and we will make adjustments in future reports, 
as necessary and possible. 

[106] Our indicators use data collected by the Federal Reserve on form 
FR Y-9C, which currently requires bank, financial, and savings and 
loan holding companies with more than $10 billion in assets to report 
their net current credit exposure to counterparties in OTC derivatives 
contracts and the fair value of the collateral pledged by those 
counterparties to secure the contracts. 

[107] The fair value of collateral is the amount that would be 
received if the collateral was sold in an orderly transaction between 
market participants in its principal market on the measurement date. 

[108] Net current credit exposure to a counterparty is derived by 
first calculating the fair values of all derivative contracts with 
that counterparty, where the fair value of a derivative contract is 
analogous to the fair value of collateral. If a legally enforceable 
bilateral netting agreement is in place, the fair values of all 
applicable derivative contracts in the scope of the netting agreement 
with that counterparty are netted to a single amount, which may be 
positive, negative, or zero. Net current credit exposure across all 
counterparties is the sum of the gross positive fair values for 
counterparties without legal netting arrangements and the net current 
credit exposure for counterparties with legal netting agreements. 

[109] Exec. Order No. 13,579. 76 Fed. Reg. 41,587 (July 14, 2011). 
Section 2 of the order emphasizes the importance of retrospective 
analysis of rules. It contains a "look back" provision: "Within 120 
days of the date of this order, each independent regulatory agency 
should develop and release to the public a plan, consistent with law 
and reflecting its resources and regulatory priorities and processes, 
under which the agency will periodically review its existing 
significant regulations to determine whether any such regulations 
should be modified, streamlined, expanded, or repealed so as to make 
the agency's regulatory program more effective or less burdensome in 
achieving the regulatory objectives." 

[110] Pub. L. No. 104-208, Div. A, Tit. II, § 2222, 110 Stat. 3009-
394, 3009-414 (1996) (codified at 12 U.S.C. § 3311). 

[111] Joint Report to Congress July 31, 2007; Economic Growth and 
Regulatory Paperwork Reduction Act. 72 Fed. Reg. 62,036 (Nov. 1, 2007). 

[112] 76 Fed. Reg. 75,825 (Dec. 5. 2011). 

[113] For example, in May 2013, CFPB issued a final rule amending the 
ability-to-pay regulations under the Credit Card Accountability 
Responsibility and Disclosure Act of 2009 in response to industry 
participants' comments to its December 2011 request. 78 Fed. Reg. 
25,818 (May 3, 2013). 

[114] 76 Fed. Reg. 38,328 (June 30, 2011). CFTC's release responded to 
Executive Order 13,563, entitled ''Improving Regulation and Regulatory 
Review,'' which supplements and reaffirms Executive Order 12,866 
partly by incorporating its principles, structures, and definitions. 
Exec. Order 13,563, 76 Fed. Reg. 3821 (Jan. 18, 2011). Section 6 of 
the order focuses on the importance of maintaining a consistent 
culture of retrospective review and analysis by agencies of their 
regulatory programs. Shortly after the issuance of Executive Order 
13,563, the President issued E.O. 13,579 to encourage independent 
regulatory agencies to comply with E.O. 13,563. 

[115] 76 Fed. Reg. 56,128 (Sept.12, 2011). 

[116] For example, SEC noted that it retrospectively reviews rules 
based on suggestions from investors, investor and industry groups, and 
others and as required by section 610(a) of the Regulatory Flexibility 
Act. 

[117] M-11-28 (July 22, 2011). 

[118] See GAO, Reexamining Regulations: Opportunities Exist to Improve 
Effectiveness and Transparency of Retrospective Reviews, [hyperlink, 
http://www.gao.gov/products/GAO-07-791] (Washington, D.C.: July 16, 
2007). 

[119] See [hyperlink, http://www.gao.gov/products/GAO-12-151]. 

[120] [hyperlink, http://www.gao.gov/products/GAO-12-151] and 
[hyperlink, http://www.gao.gov/products/GAO-13-101]. 

[121] OMB is required to produce annual reports to Congress on the 
benefits and costs of federal regulations. Consolidated Appropriations 
Act of 2001, Pub. L. No. 106-554, § 624, 114 Stat. 2763, 2763A-161 
(2000) (codified at 31 U.S.C. § 1105 note). See, for example, OMB, 
2013 Draft Report to Congress on the Benefits and Costs of Federal 
Regulations and Agency Compliance with the Unfunded Mandates Reform 
Act (Washington, D.C: 2013); and OMB, 2012 Report to Congress on the 
Benefits and Costs of Federal Regulations and Unfunded Mandates on 
State, Local, and Tribal Entities (Washington, D.C: 2012). 

[122] The agencies covered in our review are the federal financial 
regulators, the Financial Stability Oversight Council, and the 
Department of the Treasury. We use the term "federal financial 
regulators" to refer to the Consumer Financial Protection Bureau, 
Commodity Futures Trading Commission, Federal Deposit Insurance 
Corporation, Federal Reserve, Office of the Comptroller of the 
Currency, National Credit Union Administration, and Securities and 
Exchange Commission. 

[123] In this report, we use the terms "rules," "regulations," or 
"rulemakings" generally to refer to Federal Register notices of agency 
action pursuant to the Dodd-Frank Act, including regulations, 
interpretive rules, general statements of policy, guidance, and rules 
that deal with agency organization, procedure, or practice. Combined 
with our past two reports, we have reviewed all Dodd-Frank Act rules 
in effect as of July 22, 2013. See GAO, Dodd-Frank Act Regulations: 
Implementation Could Benefit from Additional Analyses and 
Coordination, [hyperlink, http://www.gao.gov/products/GAO-12-151] 
(Washington, D.C.: Nov. 10, 2011), and Dodd-Frank Act Regulations: 
Agencies' Efforts to Analyze and Coordinate Their Rules, [hyperlink, 
http://www.gao.gov/products/GAO-13-101] (Washington, D.C.: Dec. 18, 
2012). 

[124] The other 11 rules were technical amendments to previous rules, 
general statements of policy, interpretations, or guidance. 

[125] CRA's definition of a major rule is similar, but not identical, 
to the definition of a "significant regulatory action" under E.O. 
12,866. 

[126] As independent regulatory agencies that are not required to 
follow the economic analysis requirements of E.O. 12,866, the 
financial regulators also are not required to follow OMB Circular A-4. 
However, Circular A-4 is an example of best practices for agencies to 
follow when conducting regulatory analyses, and the financial 
regulators have told us that they follow the guidance in spirit. 

[127] CRA requires agencies to file rules with Congress and the 
Comptroller General before the rules can become effective. 5 U.S.C. § 
801(a)(1)(A). To compile information on all the rules submitted under 
CRA, GAO established a database and created a standardized submission 
form to allow more consistent information collection. The Federal 
Rules database is publicly available at [hyperlink, 
http://www.gao.gov] under Legal Decisions & Bid Protests. 

[128] The Dodd-Frank Act does not use the term "systemically important 
financial institution" (SIFI). This term is commonly used by academics 
and other experts to refer to bank holding companies with $50 billion 
or more in total consolidated assets and nonbank financial companies 
designated by the Financial Stability Oversight Council (FSOC) for 
Federal Reserve supervision and enhanced prudential standards under 
the Dodd-Frank Act. For purposes of this report, we refer to these 
bank and nonbank financial companies as bank systemically important 
financial institutions (bank SIFIs) and nonbank systemically important 
financial institutions (nonbank SIFIs), respectively. We also refer to 
nonbank SIFIs and bank SIFIs collectively as SIFIs when appropriate. 

[129] [hyperlink, http://www.gao.gov/products/GAO-13-101]. 

[130] Our analyses of bank SIFIs include U.S. bank holding companies 
with total consolidated assets of $50 billion or more and foreign bank 
organizations' U.S.-based bank holding company subsidiaries that on 
their own have total consolidated assets of $50 billion or more. 

[131] The Basel Committee has agreed on a new set of risk-based 
capital, leverage, liquidity, and other requirements for banking 
institutions (Basel III requirements). Additionally, the Financial 
Stability Board and the Basel Committee have agreed on new capital and 
other requirements applicable to designated globally systemically 
important banks (G-SIB requirements). U.S. banking regulators have 
implemented some of these requirements, and the Federal Reserve has 
indicated its intention to base some of the SIFI enhanced prudential 
standards on the Basel III and G-SIB requirements. For more details 
see appendix V. 

[132] In our last report we presented the information in figure 3 and 
table 7 using data as of October 23, 2012, and October 22, 2012, 
respectively. This report uses data as of the June 30TH in 2010, 2012, 
and 2013 to provide analysis of trend changes that are more consistent 
with the time frames used in the other indicators. 

[133] Because these limitations affect both the numerator and the 
denominator of our indicators, we cannot determine whether the 
exclusion of off-balance sheet items results in an under-or an 
overstatement of an institution's liquidity need and access. 

[134] See appendix V for the rulemaking status of the enhanced 
prudential standards. 

[End of section] 

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