Making good on Federal Reserve Governor Daniel Tarullo’s promise earlier this month of imminent Federal Reserve Board (“Board”) action to regulate foreign banks in the U.S. under the Dodd-Frank Act, late Friday afternoon the Board proposed regulations (“Proposal”) to implement the enhanced prudential regulation and early remediation requirements of Sections 165 and 166 of the Dodd-Frank Act for systemically important and other foreign banks, and foreign nonbank financial institutions. Comments on these proposals will be due by March 31, 2013.

Highlights of the Proposal -

The following is a brief summary of Friday’s 304-page Proposal. In general, the Proposal tracks the requirements of the Board’s December 2011 proposed rules for enhanced prudential regulation and early remediation of U.S. bank holding companies, but with important modifications for affected FBOs.