Joint Agency Policy Statement: Interest Rate Risk — 1996-06-26 [96-16300]

The OCC, the Board, and the FDIC (collectively referred to as the agencies) are issuing this joint agency policy statement (policy statement) to bankers to provide guidance on sound practices for managing interest rate risk. The policy statement identifies the key elements of sound interest rate risk management and describes prudent principles and practices for each of these elements. It emphasizes the importance of adequate oversight by a bank's board of directors and senior management and of a comprehensive risk management process. The policy statement also describes the critical factors affecting the agencies' evaluation of a bank's interest rate risk when making a determination of capital adequacy. The principles for sound interest rate risk management outlined in this policy statement apply to all commercial banks and FDIC-supervised savings banks (banks).