United States

Topic: Banking

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FSB and Basel Committee set out supervisory recommendations for benchmark transition

On 9 July 2020, the Financial Stability Board (FSB) and the Basel Committee on Banking Supervision (Basel Committee) issued a report on supervisory issues associated with benchmark transition. The report includes insights on remaining challenges to LIBOR transition based on surveys undertaken by the FSB, the Basel Committee and the International Association of Insurance Supervisors. … Continue Reading

Basel Committee publication: Targeted revisions to the CVA risk framework

On 8 July 2020, the Basel Committee on Banking Supervision (Basel Committee) published a paper setting out the final targeted revisions to the credit valuation adjustment (CVA) risk framework. In January 2019 the Basel Committee published the revised market risk framework. In November 2019 the Basel Committee consulted on a set of targeted final revisions … Continue Reading

The LIBOR Transition — CFPB addresses elimination of LIBOR in consumer credit transactions

LIBOR is used as a component of an interest or finance charge in consumer transactions as well as the commercial transactions we have discussed in prior LIBOR Transition posts. On June 4, 2020, the US Consumer Financial Protection Bureau (CFPB), issued a proposed rule that would amend US consumer credit regulations to address the pending … Continue Reading

OCC formalizes “valid-when-made” interest rate doctrine on loan transfers

On June 2, 2020, the Office of the Comptroller of the Currency (“OCC”) published a final rule clarifying the permissible interest rates on transferred loans in relation to the “valid-when-made” doctrine. According to the “valid-when-made” doctrine, a loan is valid at its inception and cannot become invalid or unenforceable based on its original terms due … Continue Reading

The LIBOR Transition – ARRC 2020 Best Practices for Completing the Transition from LIBOR

Following on our post discussing the ARRC’s publication of their 2020 Key Objectives, we mentioned that ARRC panned to release a set of recommended best practices. As promised, the ARRC has published guidance for Best Practices for Completing the Transition from LIBOR (“Best Practices Guidance”), along with an accompanying fact sheet, which sets forth recommended … Continue Reading

The LIBOR Transition – ARRC’s further consultation on spread adjustment methodologies and advice on the SOFR Index

Following on our post discussing the ARRC’s recommendations outlining a spread adjusting procedure, we mentioned that the ARRC planned to release a more detailed final recommendation of the spread adjustment methodology for cash products. On May 6, 2020, the ARRC released a supplemental consultation seeking further views on certain technical questions for the spread adjustment … Continue Reading

US bank regulators issue cloud computing security guidance

On April 30, 2020, the US Federal Financial Institutions Examination Council (FFIEC), an interagency group of federal and state banking regulators, issued guidance on “Security in a Cloud Computing Environment.” The FFIEC guidance focuses on security risk management principles and the financial services sector’s use of cloud computing, and supplements its publications on outsourcing of … Continue Reading

Updated TALF term sheet released

On April 9, 2020, the Federal Reserve released an updated term sheet for the Term Asset-Backed Securities Loan Facility (“TALF”). Eligible borrowers under TALF (“Eligible Borrowers”) must now be U.S. companies that own eligible collateral and maintain an account relationship with a primary dealer. A “U.S. company” now is defined as a business that is … Continue Reading

The LIBOR Transition – ARRC 2020 Key Objectives

Following up on our past posts on the transition away from the London Interbank Offering Rate (“LIBOR”), and other interbank offering rates (“IBOR”) denominated in other currencies, in this post, we discuss the key objectives for 2020 released by the Alternative Reference Rates Committee (“ARRC”), the group of private market participants advising the Federal Reserve … Continue Reading

The LIBOR Transition – ARRC issues recommendations outlining spread adjusting procedure

Following up on our past posts on the transition away from the London Interbank Offering Rate (“LIBOR”), and interbank offering rates (“IBOR”) denominated in other currencies, in this post, we discuss the agreement reached by the members of the Alternative Reference Rates Committee (“ARRC”) on a spread adjustment methodology for cash products referencing U.S. dollar … Continue Reading

The other side of the Volcker Rule: Proposed changes to the covered funds provisions

In November 2019, the financial services regulators responsible for the Volcker Rule regulations (the Board of Governors of the Federal Reserve Board, the Office of the Comptroller of the Currency, the Commodity Futures Trading Commission, the Federal Deposit Insurance Corporation and the Securities and Exchange Commission, collectively, the “Agencies”) issued final rules revising the proprietary … Continue Reading

US AML compliance during the COVID-19 pandemic

The US anti-money laundering (AML) agency, the Financial Crimes Enforcement Network (FinCEN), has issued guidance regarding AML compliance for financial institutions during the current COVID-19 pandemic. This guidance would be in addition to any issuances from their respective functional regulators, if any. March 16 Guidance On March 16, 2020, FinCEN issued guidance requesting that financial … Continue Reading

The LIBOR Transition – ARRC’s Recommended Fallback Contract Language – New Variable Rate Private Student Loans

Following up on our past posts on the transition away from the London Interbank Offering Rate (“LIBOR”), and other interbank offering rates (“IBOR”) denominated in other currencies, in this post, we discuss the proposal from the Alternative Reference Rates Committee (“ARRC”) consultation on fallback contract language for new variable rate private student loans. This is … Continue Reading

NYDFS Requires COVID-19 Plans by April 9

On March 10, 2020, the New York Department of Financial Services (NYDFS) issued guidance to all of its regulated institutions engaged in virtual currency business activity, requiring them to have plans for preparedness to manage the possible operational and financial risks posed by the COVID-19 pandemic. NYDFS requires the plans to be submitted by Thursday, … Continue Reading

US banking regulators delay CECL adoption for some, but not all, banks

After industry groups stressed the need to adopt regulatory changes in light of the COVID-19 pandemic, on March 27, 2020, the Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation and Office of the Comptroller of the Currency (collectively, the “Banking Agencies”) issued a joint press release announcing an interim final rule … Continue Reading

US financial regulators establish webpages on the COVID-19 pandemic

The US financial regulatory, consumer protection and enforcement supervisors are regularly issuing press releases and statements concerning the COVID-19 pandemic. Each of them has established special links to provide information to the public on its response to the pandemic. Board of Governors of the Federal Reserve System: https://www.federalreserve.gov/covid-19.htm Commodity Futures Trading Commission: https://www.cftc.gov/coronavirus Conference of State … Continue Reading

Federal Reserve establishes Commercial Paper Funding Facility

As part of a comprehensive effort to alleviate strain on the commercial paper markets due to the COVID-19 pandemic, on March 17, 2020 the Board of Governors of the Federal Reserve System (the “Federal Reserve”) announced the creation of the Commercial Paper Funding Facility (“CPFF”). Similar to the CPFF program implemented in 2008, which was … Continue Reading

Federal Reserve announces TALF 2.0 to assist asset-backed issuers

On March 23, 2020, the Board of Governors of the Federal Reserve System (the “Federal Reserve”) announced a wide array of actions intended to promote economic stability in light of the COVID-19 pandemic, including several different credit facilities. The Federal Reserve announced as one of these credit facilities a renewal of the Term Asset-Backed Securities … Continue Reading

US banking regulators weigh in on the coronavirus (COVID-19) pandemic

As with other US and non-US regulators, the US federal banking regulators (Federal Reserve Board, Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation, collectively, the “US federal banking regulators”) have been issuing statements and providing guidance on the impact of the coronavirus on banking services. This blog posts covers some … Continue Reading

The LIBOR Transition – ARRC releases recommended NY Legislation on LIBOR

Following up on our past posts on the transition away from the London Interbank Offering Rate (“LIBOR”), and other interbank offering rates (“IBOR”) denominated in other currencies, we discuss the proposal from the Alternative Reference Rates Committee (“ARRC”) for New York legislation, which was published on March 6, 2020. The ARRC is a group of … Continue Reading

Federal Reserve Board finalizes rule to clarify and simplify “control” under the Bank Holding Company Act

On January 30, 2020, the Federal Reserve Board voted to finalize its April 2019 proposed rule to clarify and simplify the standards under which the Federal Reserve Board determines that one company controls a banking organization or another company. Our post on the April 2019 proposal may be accessed here. The final rule will be … Continue Reading

“Crypto Mom” Proposes 3-Year Safe Harbor for Token Projects

In a speech to the International Blockchain Congress on February 6, 2020, Securities and Exchange (“SEC”) Commissioner Hester Peirce, sometime referred to as “Crypto Mom,” proposed a three-year safe harbor for virtual currency token projects.  The safe harbor would exempt (i) the offer and sale of tokens from the provisions of the Securities Act of … Continue Reading

The LIBOR Transition – SFA Survey on Potential LIBOR Transition Solutions for Securitization Market Legacy Vehicles and Instruments

Following up on our past posts, in this update on the transition away from LIBOR (London Interbank Offering Rate), and other interbank offering rates (“IBOR”) denominated in other currencies, we discuss a Structured Finance Association (“SFA”) survey with respect to potential LIBOR transition solutions in the securitization industry. The SFA is group of structured finance … Continue Reading

United States imposes additional Iranian sanctions

On January 10, 2020, the United States (US) imposed economic sanctions on: Iranian sectors that previously had not been specifically targeted, namely the construction, mining, manufacturing and textile sectors; Certain Iranian regime officials; Iran’s largest companies operating in the steel, iron, aluminum, and copper sectors ; and Non-Iranian entities for trade in Iranian metals. Norton … Continue Reading
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