Congress originally approved the 13(3) authority in response to business lending problems during the Depression. It allows the Fed broad authority to lend to a wide range of borrowers using good collateral in unusual and exigent circumstances as long as at least five governors – all we currently have on the Board – approve.
We do understand that this could present some complications for foreign banks using approaches for their consolidated organizations that are not offered in the United States, such as Foundation IRB for credit risk. When the parent organization's approach does not align with what the U.S. subsidiary must choose (either advanced approaches or current rules), some adjustments will indeed be necessary.