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Under the Spotlight

Banking regulators are making "Regulation W" a priority. Implications and approaches for banks to consider.


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It’s been a decade since the Federal Reserve implemented Regulation W, which was designed to limit certain transactions between financial institutions and their affiliates. For some banks, enterprise-wide compliance with Regulation W has been a particular challenge — and remains so — due to the significant growth in capital market activities, pressure to rationalize compliance and operations and increased numbers of mergers and acquisitions. Plus, their current compliance programs have been unable to keep up with the complexity and volume of affiliate activities and pace of automation to report transactions, among other factors.

We have identified six components banks can take to implement a centralized, end-to-end Regulation W compliance program. These include:

  • Governance
  • Risk assessment
  • Monitoring and testing
  • Reporting and communication
  • Training
  • Technology enablement

Banks should make the necessary investments and changes to their structures and processes to comply with the decade-old formalization of the 23A and 23B requirements of the Federal Reserve Act as implemented through Regulation W, especially since federal regulators are renewing their focus — and as business models and approaches to intercompany transactions have evolved. 

Download the article to obtain more insights into how Regulation W may impact your organization.

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