Enhanced Prudential Standards (EPS) Snapshot

Snapshot Enhanced Prudential Standards (EPS)

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TABLE OF CONTENTS

1 EPS Overview _____________________________________ 3

2 Key Dates and Milestones ___________________________ 4

3 Impact Assessment* _______________________________ 5

4 Considerations ___________________________________ 7

5 Opportunities ____________________________________ 7

6 How we add value _________________________________ 8

7 About Hatstand ___________________________________ 9

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Snapshot Enhanced Prudential Standards (EPS)

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1 EPS Overview

EPS establishes enhanced supervision standards at large US bank holding companies (BHC, >=US $50B in global consolidated assets) and foreign banking organisations (FBO’s) with a significant US presence (>=US $50B in U.S. consolidated assets, excludes branch/agency assets). EPS applies enhanced capital, liquidity, risk management, and stress testing requirements to US BHC’s and to the US operations of FBO’s. In addition, the FBO’s, with US non-branch subsidiary operations and more than US $50 billion in assets, are required to place nearly all those subsidiaries into an intermediate US holding company (IHC) that is, in turn, subject to the EPS requirements. This set of regulations overlaps with Basel III liquidity and capital requirements and reporting.

EPS establishes heightened supervision standards by applying enhanced capital, liquidity, risk management, and stress testing requirements on US BHC’s and the US operations of FBO’s.

Snapshot Enhanced Prudential Standards (EPS)

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2 Key Dates and Milestones

Key Dates Milestones January 1, 2015 Large BHC’s subject to risk

management and qualitative liquidity standards. FBO Implementation plan to enable compliance with the IHC requirement.

July 1, 2015 Mid-size BHC (>USD 10 B in total consolidated assets) subject to Risk Committee Governance.

January 1, 2016 BHC’s & IHC’s subject to capital conservation buffer.

July 1, 2016 Deadline of formation/designation of IHCs’. IHCs’ must comply with EPS.

August 1, 2016 Notification to FED of IHC and compliance certification of IHC EPS requirements.

January 2017 Submission of IHC annual capital plan to the FED.

July 1, 2017 Completion of transfer of all remaining applicable assets from FBO to IHC.

October 1, 2017 First Dodd-Frank stress testing cycle.

January 1, 2018 IHC Compliance with U.S. Basel III leverage ratio requirements.

January 2018 Submission of IHC annual capital plan to the FED.

March 2018 Summary results of company run stress test to FED.

July 2018 Submit mid-year Dodd Frank stress tests to the FED.

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