Updated Guidance on Leveraged Finance

The FRB, FDIC, and OCC have updated their Interagency Guidance on Leveraged Lending to address what the agencies see as deteriorating underwriting standards for leveraged loans, in which a borrower's leverage exceeds industry norms. The guidance states that it will not affect the vast majority of community banks, which largely do not participate in leveraged finance activities, but it does not specifically exempt community banks.