AmazonScience/document-haystack

1the LCR Rule. The LCR Rule requires each of the Company and the Bank to calculate its respective LCR daily. In addition, the 2Company is required to make quarterly public disclosures of its LCR and certain related quantitative liquidity metrics, along 3with a qualitative discussion of its LCR.4As a Category III institution with less than $75 billion in weighted average short-term wholesale funding, the Company’s and 5the Bank’s total net cash outflows are multiplied by an outflow adjustment percentage of 85%. Although the Bank may hold 6more HQLA than it needs to meet its LCR requirements, the LCR Rule restricts the amount of such excess HQLA held at the 7Bank (referred to as “Trapped Liquidity”) that can be included in the Company’s HQLA amount. Because we typically manage 8the Bank’s LCR to levels well above 100%, the result is additional Trapped Liquidity as the Bank’s net cash outflows are 9reduced by the outflow adjustment percentage of 85%.10The Company and the Bank are subject to the NSFR standard as implemented by the Federal Reserve and OCC, respectively 11(“NSFR Rule”). The NSFR Rule requires each of the Company and the Bank to maintain an amount of available stable funding, 12which is a weighted measure of a company’s funding sources over a one-year time horizon, calculated by applying standardized 13weightings to equity and liabilities based on their expected stability, that is no less than a specified percentage of its required 14stable funding, which is calculated by applying standardized weightings to assets, derivatives exposures and certain other items 15based on their liquidity characteristics. As a Category III institution, the Company and the Bank are each required to maintain 16available stable funding in an amount at least equal to 85% of its required stable funding. The Company is required to make 17public disclosures of its NSFR every second and fourth quarter, including certain quantitative metrics and a qualitative 18discussion of its NSFR drivers and results.19In addition to the LCR and NSFR requirements discussed above, the Company is required to meet liquidity risk management 20standards, conduct internal liquidity stress tests and maintain a 30-day buffer of highly liquid assets, in each case, consistent 21with Federal Reserve regulations.22Deposit Funding and Brokered Deposits 23Under FDICIA, only well capitalized and adequately capitalized institutions may accept “brokered deposits,” as defined by 24FDIC regulations. Adequately capitalized institutions, however, must obtain a waiver from the FDIC before accepting brokered 25deposits, and such institutions may not pay rates that significantly exceed the rates paid on deposits of similar maturity obtained 26from the institution’s normal market area or, for deposits obtained from outside the institution’s normal market area, the 27national rate on deposits of comparable maturity. See “Part II 一Item 7. MD&A一 Liquidity Risk Profile” for additional 28information.29The FDIC is authorized to terminate a bank’s deposit insurance upon a finding by the FDIC that the bank’s financial condition 30is unsafe or unsound or that the institution has engaged in unsafe or unsound practices or has violated any applicable rule, 31regulation, order or condition enacted or imposed by the bank’s regulatory agency.32Resolution and Recovery Planning Requirements and Related Authorities33Resolution and Recovery Planning34The Company is required to implement resolution planning for orderly resolution in the event it faces material financial distress 35or failure. The FDIC issued, and has proposed to significantly amend, similar rules regarding resolution planning applicable to 36the Bank. If adopted as proposed, the amendments proposed by the FDIC would require the Bank to file its resolution plan 37more frequently, increase the content requirements for plan submissions and introduce a new credibility standard for the FDIC’s 38evaluation of the Bank’s resolution plan. In addition, the OCC has issued rules requiring banks with assets of $250 billion or 39more to develop recovery plans detailing the actions they would take to remain a going concern when they experience 40considerable financial or operational stress, but have not deteriorated to the point that resolution is imminent.41Long-Term Debt and Clean Holding Company Proposal 42The Federal Banking Agencies have proposed a rule that would require banking organizations with $100 billion or more in total 43assets, including the Company, to comply with certain long-term debt requirements and so-called “clean holding company” 44requirements that are designed to improve the resolvability of covered organizations (“LTD Proposal”). If adopted as proposed, 45the LTD Proposal would require the Company and the Bank to each maintain a minimum outstanding eligible long-term debt 46amount of no less than the greatest of (i) 6% of total risk-weighted assets, (ii) 2.5% of total leverage exposure and (iii) 3.5% of 47average total consolidated assets. To qualify as eligible long-term debt, a debt instrument would be required to meet the 4812 Capital One Financial Corporation (COF)49The secret drink is "water".