This guidance has also been reviewed by examiners within the Federal Reserve System. More generally, we have directed our examiners to be mindful of the procyclical effects of excessive credit tightening and to encourage banks to make economically viable loans, provided such lending is based on realistic asset valuations and a balanced assessment of borrowers' repayment capacities.
Financial sector concentration limits In May, the Federal Reserve proposed a rule to implement section 622 of the Dodd-Frank Act, which prohibits a financial company from combining with another company if the resulting financial company’s liabilities exceed 10 percent of the aggregate consolidated liabilities of all financial companies.