Prior to the passage of the Dodd-Frank Act, a large IDI’s  DIF premiums principally were based on the size of an IDI’s  domestic deposit base. Section 331(b) of Dodd-Frank changed  the assessment base from an IDI’s domestic deposit base to its  total  assets. In addition to potentially greatly increasing the size  of a large IDI’s assessment base, the expansion of the  assessment base affords the FDIC much greater flexibility to  vary its assessment system based upon the different asset  classes that large IDIs normally hold on their balance sheets. To implement this provision, the FDIC created an  assessment scheme vastly different from the deposit-based  system. Under the new system, large IDIs will be assessed  under a complex “scorecard” methodology that seeks to capture  both the probability that an individual large IDI will fail and the  magnitude of the impact on the DIF if such a failure occurs. Sections 23A and 23B of the Federal Reserve Act, restrict  transactions between a bank and an affiliated company,  including a parent bank holding company. The Bancorp’s  subsidiary bank is subject to certain restrictions on loans to  affiliated companies, on investments in the stock or securities  thereof, on the taking of such stock or securities as collateral for  loans to any borrower, and on the issuance of a guarantee or  letter of credit on their behalf. Among other things, these  restrictions limit the amount of such transactions, require  collateral in prescribed amounts for extensions of credit,  prohibit the purchase of low quality assets and require that the  terms of such transactions be substantially equivalent to terms  of similar transactions with non-affiliates. Generally, the  Bancorp’s subsidiary bank is limited in its extension of credit to  any affiliate to 10% of the subsidiary bank’s capital and its  extension of credit to all affiliates to 20% of the subsidiary  bank’s capital. The CRA generally requires insured depository institutions  to identify the communities they serve and to make loans and  investments and provide services that meet the credit needs of  these communities. Furthermore, the CRA requires the FRB to  evaluate the performance of each of the subsidiary banks in  helping to meet the credit needs of their communities. As a part  of the CRA program, the subsidiary banks are subject to  periodic examinations by the FRB, and must maintain  comprehensive records of their CRA activities for this purpose. During these examinations, the FRB rates such institutions’  compliance with CRA as “Outstanding,” “Satisfactory,” “Needs  to Improve” or “Substantial Noncompliance.” Failure of an  institution to receive at least a “Satisfactory” rating could  inhibit such institution or its holding company from undertaking  certain activities, including engaging in activities permitted as a  financial holding company under the GLBA and acquiring other  financial institutions. The FRB must take into account the  record of performance of banks in meeting the credit needs of  the entire community served, including low- and moderate- income neighborhoods. Fifth Third Bank received a “Satisfactory” CRA rating in its most recent CRA examination. The FRB has established capital guidelines for bank  holding companies and FHCs. The FRB, the Division and the  FDIC have also issued regulations establishing capital requirements for banks. Failure to meet capital requirements  could subject the Bancorp and its subsidiary bank to a variety of  restrictions and enforcement actions. In addition, as discussed  previously, the Bancorp’s subsidiary bank must remain well  capitalized and well managed for the Bancorp to retain its status  as a FHC. In addition, as of the Dodd-Frank Act “transfer date”  (currently anticipated to be July 21, 2011), the Bancorp also  must be well capitalized and well managed to retain its financial  holding company status. The GLBA requires financial institutions to implement  policies and procedures regarding the disclosure of nonpublic  personal information about consumers to non-affiliated third  parties. In general, the statute requires explanations to  consumers on policies and procedures regarding the disclosure  of such nonpublic personal information, and, except as  otherwise required by law, prohibits disclosing such information except as provided in the subsidiary bank’s policies  and procedures. The Bancorp’s subsidiary bank has Historically, the minimum risk-based capital requirements  adopted by the federal banking agencies typically followed the  Capital Accord of the Basel Committee on Banking Supervision. On December 16, 2010, the Basel Committee on  Banking Supervision (the “Basel Committee”) issued the final  text of a comprehensive update of the 2004 Basel II Accord  (“Basel III”). On January 13, 2011, the Basel Committee issued  an Annex to Basel III containing the final elements of reform to  the definition of regulatory capital. Basel III aims to reform the  international financial system by instituting significantly higher  global capital requirements and new liquidity and leverage  standards. Basel III is not itself binding, but rather must be  adopted into United States law or regulation before affecting  banks supervised in the United States. Moreover, if adopted in  the United States Basil III likely would not become effective  until 2013, and its provision would be subject to a multi-year  transition period.  Basel III significantly revises the definitions of regulatory  capital, establishing separate capital requirements for common  equity Tier 1 Capital (a new regulatory metric), Tier 1 Capital,  consisting of the sum of Tier 1 Common Equity and Additional  Tier 1 Capital, and Total Capital, consisting of the sum of Tier  1 Common Equity, Additional Tier 1 and Tier 2 Capital. Basel  III, if implemented, ultimately would require banks to maintain  a minimum Tier 1 Common Equity Capital ratio of 4.5%, a  minimum Tier 1 Capital ratio of 6%, and a minimum Total  Capital ratio of 8%. Among other significant reforms to the  definition of regulatory capital, Basel III disqualifies certain  structured capital instruments, such as trust preferred securities,  from Tier 1 capital status. (Dodd-Frank also disqualifies trust- preferred and similar instruments over a three year period  beginning in 2013.) In addition to higher minimum capital  standards, Basel III also institutes new capital conservation and  countercyclical buffers that could, if fully implemented, create  significant incentive for banks to maintain up to an additional  5% above the minimum capital requirements.  Basel III also introduces two measures of liquidity based  on risk exposure, one based on a 30-day time horizon under an  acute liquidity stress scenario and one designed to promote  more medium and long-term funding of the assets and activities  of banks over a one-year time horizon.  The FRB, FDIC and other bank regulatory agencies have  adopted final guidelines (the “Guidelines) for safeguarding  confidential, personal customer information. The Guidelines  require each financial institution, under the supervision and  ongoing oversight of its Board of Directors or an appropriate  committee thereof, to create, implement and maintain a  comprehensive written information security program designed  to ensure the security and confidentiality of customer information, protect against any anticipated threats or hazards to  the security or integrity of such information and protect against  unauthorized access to or use of such information that could  result in substantial harm or inconvenience to any customer.  The Bancorp has adopted a customer information security  program that has been approved by the Bancorp’s Board of  Directors (the “Board). 132 Fifth Third Bancorp