Federal Reserve and Banking Regulators Adopt Final Rule on Capital Treatment for High Volatility Commercial Real Estate (HVCRE) Exposures

Summary

The Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, and the Federal Deposit Insurance Corporation are adopting a final rule to revise the definition of 'high volatility commercial real estate (HVCRE) exposure' in the regulatory capital rule, aligning it with the statutory definition of 'high volatility commercial real estate acquisition, development, or construction (HVCRE ADC) loan' under the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA). This final rule also clarifies the capital treatment for loans financing land development under the revised HVCRE exposure definition.