REGULATORY AUTHORITIES

6 Months Ended

Jun. 30, 2024

Broker-Dealer, Net Capital Requirement, SEC Regulation [Abstract]

REGULATORY AUTHORITIES

REGULATORY AUTHORITIES

LFNY is a U.S. registered broker-dealer and is subject to the net capital requirements of Rule 15c3-1 under the Exchange Act. Under the basic method permitted by this rule, the minimum required net capital, as defined, is a specified fixed percentage (6 2/3%) of total aggregate indebtedness recorded in LFNY’s Financial and Operational Combined Uniform Single (“FOCUS”) report filed with the Financial Industry Regulatory Authority (“FINRA”), or $5, whichever is greater. In addition, the ratio of aggregate indebtedness (as defined) to net capital may not exceed 15:1. At June 30, 2024, LFNY’s regulatory net capital was $86,388, which exceeded the minimum requirement by $80,804. LFNY’s aggregate indebtedness to net capital ratio was 0.97:1 as of June 30, 2024.

Certain U.K. subsidiaries of the Company, including LCL, Lazard Fund Managers Limited and Lazard Asset Management Limited (collectively, the “U.K. Subsidiaries”) are regulated by the Financial Conduct Authority. At June 30, 2024, the aggregate regulatory net capital of the U.K. Subsidiaries was $171,625, which exceeded the minimum requirement by $98,640.

CFLF, under which asset management and commercial banking activities are carried out in France, is subject to regulation by the Autorité de Contrôle Prudentiel et de Résolution (“ACPR”) for its banking activities conducted through its subsidiary, LFB. LFB, as a registered bank, is engaged primarily in commercial and private banking services for clients and funds managed by LFG (asset management) and other clients, and asset-liability management. The investment services activities exercised through LFB and other subsidiaries of CFLF, primarily LFG, also are subject to regulation and supervision by the Autorité des Marchés Financiers. At March 31, 2024, the consolidated regulatory net capital of CFLF was $153,263, which exceeded the minimum requirement set for regulatory capital levels by $54,335. In addition, pursuant to the consolidated supervision rules in the European Union, LFB, in particular, as a French credit institution, is required to be supervised by a regulatory body, either in the U.S. or in the European Union. LFB and certain other non-Financial Advisory subsidiaries of the Company in the European Union (referred to herein, on a combined basis, as the “combined European regulated group”) is subject to consolidated supervision based on an agreement with the ACPR and under such rules is required to comply with minimum requirements for regulatory net capital. At March 31, 2024, the regulatory net capital of the combined European regulated group was $176,085, which exceeded the minimum requirement set for regulatory capital levels by $68,858. Additionally, the combined European regulated group, together with our Financial Advisory entities in the European Union, is required to perform an annual risk assessment and provide certain other information on a periodic basis.

Certain other U.S. and non-U.S. subsidiaries are subject to various capital adequacy requirements promulgated by various regulatory and exchange authorities in the countries in which they operate. At June 30, 2024, for those subsidiaries with regulatory capital requirements, their aggregate net capital was $107,788, which exceeded the minimum required capital by $84,389.

At June 30, 2024, each of these subsidiaries individually was in compliance with its regulatory capital requirements.