Statement of Applicability for FDIC-Supervised Institutions Under $10B Electing the CBLR Framework

The Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, and the Federal Deposit Insurance Corporation have jointly issued a final rule modifying the Community Bank Leverage Ratio (CBLR) framework for qualifying financial institutions.

The final rule lowers the CBLR requirement from 9 percent to 8 percent and extends the grace period for institutions that fall below the ratio from two quarters to four quarters.

the rule limits the use of the grace period to a maximum of eight out of the prior twenty quarters.

The changes apply to FDIC-supervised financial institutions with less than $10 billion in total consolidated assets that are not advanced approaches banks and elect the CBLR framework.

The agencies stated that the modifications are consistent with section 201 of the Economic Growth, Regulatory Relief, and Consumer Protection Act and are intended to encourage broader adoption of the CBLR framework while providing regulatory burden relief for community banks.

The final rule was published on April 23, 2026, and was detected by regulatory tracking services on April 24, 2026.

The agencies also compared required capital under the final rule to other risk-based capital requirements and found that the 8 percent CBLR requirement broadly requires similar or more capital for the vast majority of depository institutions that will be eligible under the final rule.

The Office of the Comptroller of the Currency, the Federal Reserve, and the FDIC emphasized that the streamlined framework may reduce reporting burden for participating banks but requires maintaining a leverage ratio above the prescribed threshold.

Banks currently using risk-based capital calculations should assess the operational implications of switching to the CBLR framework, including potential changes to risk-weighted asset calculations and reporting requirements.