(a) Applicability. For purposes of Sec. 324.20, an FDIC-supervised institution is subject to the minority interest limitations in this section if:
(1) A consolidated subsidiary of the FDIC-supervised institution has issued regulatory capital that is not owned by the FDIC-supervised institution; and
(2) For each relevant regulatory capital ratio of the consolidated subsidiary, the ratio exceeds the sum of the subsidiary's minimum regulatory capital requirements plus its capital conservation buffer.
(b) Difference in capital adequacy standards at the subsidiary level. For purposes of the minority interest calculations in this section, if the consolidated subsidiary issuing the capital is not subject to capital adequacy standards similar to those of the FDIC-supervised institution, the FDIC-supervised institution must assume that the capital adequacy standards of the FDIC-supervised institution apply to the subsidiary.
(c) Common equity tier 1 minority interest includable in the common equity tier 1 capital of the FDIC-supervised institution. For each consolidated subsidiary of an FDIC-supervised institution, the amount of common equity tier 1 minority interest the FDIC-supervised institution may include in common equity tier 1 capital is equal to:
(1) The common equity tier 1 minority interest of the subsidiary; minus
(2) The percentage of the subsidiary's common equity tier 1 capital that is not owned by the FDIC-supervised institution, multiplied by the difference between the common equity tier 1 capital of the subsidiary and the lower of:
(i) The amount of common equity tier 1 capital the subsidiary must hold, or would be required to hold pursuant to paragraph (b) of this section, to avoid restrictions on distributions and discretionary bonus payments under Sec. 324.11 or equivalent standards established by the subsidiary's home country supervisor; or
(ii)(A) The standardized total risk-weighted assets of the FDIC-supervised institution that relate to the subsidiary multiplied by
(A) The standardized total risk-weighted assets of the FDIC-supervised institution that relate to the subsidiary multiplied by
(B) The common equity tier 1 capital ratio the subsidiary must maintain to avoid restrictions on distributions and discretionary bonus payments under Sec. 324.11 or equivalent standards established by the subsidiary's home country supervisor.
(d) Tier 1 minority interest includable in the tier 1 capital of the FDIC-supervised institution. For each consolidated subsidiary of the FDIC-supervised institution, the amount of tier 1 minority interest the FDIC-supervised institution may include in tier 1 capital is equal to:
(1) The tier 1 minority interest of the subsidiary; minus
(2) The percentage of the subsidiary's tier 1 capital that is not owned by the FDIC-supervised institution multiplied by the difference between the tier 1 capital of the subsidiary and the lower of:
(i) The amount of tier 1 capital the subsidiary must hold, or would be required to hold pursuant to paragraph (b) of this section, to avoid restrictions on distributions and discretionary bonus payments under Sec. 324.11 or equivalent standards established by the subsidiary's home country supervisor, or
(ii)(A) The standardized total risk-weighted assets of the FDIC-supervised institution that relate to the subsidiary multiplied by
(A) The standardized total risk-weighted assets of the FDIC-supervised institution that relate to the subsidiary multiplied by
(B) The tier 1 capital ratio the subsidiary must maintain to avoid restrictions on distributions and discretionary bonus payments under Sec. 324.11 or equivalent standards established by the subsidiary's home country supervisor.
(e) Total capital minority interest includable in the total capital of the FDIC-supervised institution. For each consolidated subsidiary of the FDIC-supervised institution, the amount of total capital minority interest the FDIC-supervised institution may include in total capital is equal to:
(1) The total capital minority interest of the subsidiary; minus
(2) The percentage of the subsidiary's total capital that is not owned by the FDIC-supervised institution multiplied by the difference between the total capital of the subsidiary and the lower of:
(i) The amount of total capital the subsidiary must hold, or would be required to hold pursuant to paragraph (b) of this section, to avoid restrictions on distributions and discretionary bonus payments under Sec. 324.11 or equivalent standards established by the subsidiary's home country supervisor, or
(ii)(A) The standardized total risk-weighted assets of the FDIC-supervised institution that relate to the subsidiary multiplied by
(A) The standardized total risk-weighted assets of the FDIC-supervised institution that relate to the subsidiary multiplied by
(B) The total capital ratio the subsidiary must maintain to avoid restrictions on distributions and discretionary bonus payments under Sec. 324.11 or equivalent standards established by the subsidiary's home country supervisor. [78 FR 55471, Sept. 10, 2013, as amended at 79 FR 20759, Apr. 14, 2014]