DOCSLIB.ORG

Securities and Exchange Commission

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
Securities and Exchange Commission Vol. 79 Thursday, No. 157 August 14, 2014 Part II Securities and Exchange Commission 17 CFR Parts 230, 239, et al. Money Market Fund Reform; Amendments to Form PF; Final Rule VerDate Mar<15>2010 17:22 Aug 13, 2014 Jkt 232001 PO 00000 Frm 00001 Fmt 4717 Sfmt 4717 E:\FR\FM\14AUR2.SGM 14AUR2 tkelley on DSK3SPTVN1PROD with RULES2 47736 Federal Register / Vol. 79, No. 157 / Thursday, August 14, 2014 / Rules and Regulations SECURITIES AND EXCHANGE requiring money market funds to report C. Effects on Other Money Market Funds, COMMISSION additional information to the SEC and to Investors, and the Short-Term Financing investors. Finally, the amendments Markets 17 CFR Parts 230, 239, 270, 274 and require investment advisers to certain D. The Financial Crisis 279 E. Examination of Money Market Fund large unregistered liquidity funds, Regulation Since the Financial Crisis [Release No. 33–9616, IA–3879; IC–31166; which can have many of the same 1. The 2010 Amendments FR–84; File No. S7–03–13] economic features as money market 2. The Eurozone Debt Crisis and U.S. Debt funds, to provide additional information Ceiling Impasses of 2011 and 2013 RIN 3235–AK61 about those funds to the SEC. 3. Continuing Consideration of the Need DATES: Effective Date: October 14, 2014. for Additional Reforms Money Market Fund Reform; Compliance Dates: The applicable III. Discussion Amendments to Form PF A. Liquidity Fees and Redemption Gates compliance dates are discussed in 1. Analysis of Certain Effects of Fees and AGENCY: Securities and Exchange section III.N. of the Release titled Gates Commission. ‘‘Compliance Dates.’’ 2. Terms of Fees and Gates ACTION: Final rule. FOR FURTHER INFORMATION CONTACT: 3. Exemptions to Permit Fees and Gates Adam Bolter, Senior Counsel; Amanda 4. Amendments to Rule 22e–3 SUMMARY: The Securities and Exchange Hollander Wagner, Senior Counsel; 5. Operational Considerations Relating to Commission (‘‘Commission’’ or ‘‘SEC’’) Fees and Gates Andrea Ottomanelli Magovern, Senior 6. Tax Implications of Liquidity Fees is adopting amendments to the rules Counsel; Erin C. Loomis, Senior 7. Accounting Implications that govern money market mutual funds Counsel; Kay-Mario Vobis, Senior B. Floating Net Asset Value (or ‘‘money market funds’’) under the Counsel; Thoreau A. Bartmann, Branch 1. Introduction Investment Company Act of 1940 Chief; Sara Cortes, Senior Special 2. Summary of the Floating NAV Reform (‘‘Investment Company Act’’ or ‘‘Act’’). Counsel; or Sarah G. ten Siethoff, 3. Certain Considerations Relating to the The amendments are designed to Assistant Director, Investment Company Floating NAV Reform address money market funds’ Rulemaking Office, at (202) 551–6792, 4. Money Market Fund Pricing susceptibility to heavy redemptions in Division of Investment Management, 5. Amortized Cost and Penny Rounding for times of stress, improve their ability to Stable NAV Funds Securities and Exchange Commission, 6. Tax and Accounting Implications of manage and mitigate potential contagion 100 F Street NE., Washington, DC Floating NAV Money Market Funds from such redemptions, and increase 20549–8549. 7. Rule 10b–10 Confirmations the transparency of their risks, while SUPPLEMENTARY INFORMATION: The 8. Operational Implications of Floating preserving, as much as possible, their Commission is adopting amendments to NAV Money Market Funds benefits. The SEC is removing the rules 419 [17 CFR 230.419] and 482 [17 9. Transition valuation exemption that permitted CFR 230.482] under the Securities Act C. Effect on Certain Types of Money institutional non-government money of 1933 [15 U.S.C. 77a–z–3] (‘‘Securities Market Funds and Other Entities 1. Government Money Market Funds market funds (whose investors Act’’), rules 2a–7 [17 CFR 270.2a–7], historically have made the heaviest 2. Retail Money Market Funds 12d3–1 [17 CFR 270.12d3–1], 18f–3 [17 3. Municipal Money Market Funds redemptions in times of stress) to CFR 270.18f–3], 22e–3 [17 CFR 270.22e– 4. Implications for Local Government maintain a stable net asset value per 3], 30b1–7 [17 CFR 270.30b1–7], 31a–1 Investment Pools share (‘‘NAV’’), and is requiring those [17 CFR 270.31a–1], and new rule 30b1– 5. Unregistered Money Market Funds funds to sell and redeem shares based 8 [17 CFR 270.30b1–8] under the Operating Under Rule 12d1–1 on the current market-based value of the Investment Company Act of 1940 [15 6. Master/Feeder Funds—Fees and Gates securities in their underlying portfolios U.S.C. 80a], Form N–1A under the Requirements rounded to the fourth decimal place Investment Company Act and the 7. Application of Fees and Gates to Other Types of Funds and Certain (e.g., $1.0000), i.e., transact at a Securities Act, Form N–MFP under the ‘‘floating’’ NAV. The SEC also is Redemptions Investment Company Act, and section 3 D. Guidance on the Amortized Cost adopting amendments that will give the of Form PF under the Investment Method of Valuation and Other boards of directors of money market Advisers Act [15 U.S.C. 80b], and new Valuation Concerns funds new tools to stem heavy Form N–CR under the Investment 1. Use of Amortized Cost Valuation redemptions by giving them discretion Company Act.1 2. Other Valuation Matters to impose a liquidity fee if a fund’s E. Amendments to Disclosure weekly liquidity level falls below the Table of Contents Requirements required regulatory threshold, and I. Introduction 1. Required Disclosure Statement giving them discretion to suspend II. Background 2. Disclosure of Tax Consequences and redemptions temporarily, i.e., to ‘‘gate’’ A. Role of Money Market Funds Effect on Fund Operations—Floating B. Certain Economic Features of Money NAV funds, under the same circumstances. 3. Disclosure of Transition to Floating NAV These amendments will require all non- Market Funds 1. Money Market Fund Investors’ Desire To 4. Disclosure of the Effects of Fees and government money market funds to Gates on Redemptions impose a liquidity fee if the fund’s Avoid Loss 2. Liquidity Risks 5. Historical Disclosure of Liquidity Fees weekly liquidity level falls below a 3. Valuation and Pricing Methods and Gates designated threshold, unless the fund’s 4. Investors’ Misunderstanding About the 6. Prospectus Fee Table board determines that imposing such a Actual Risk of Investing in Money Market 7. Historical Disclosure of Affiliate fee is not in the best interests of the Funds Financial Support fund. In addition, the SEC is adopting 8. Economic Analysis 9. Web site Disclosure 1 amendments designed to make money Unless otherwise noted, all references to F. Form N–CR market funds more resilient by statutory sections are to the Investment Company Act, and all references to rules under the 1. Introduction increasing the diversification of their Investment Company Act, including rule 2a–7, will 2. Part B: Defaults and Events of Insolvency portfolios, enhancing their stress testing, be to Title 17, Part 270 of the Code of Federal 3. Part C: Financial Support and improving transparency by Regulations, 17 CFR Part 270. 4. Part D: Declines in Shadow Price VerDate Mar<15>2010 17:22 Aug 13, 2014 Jkt 232001 PO 00000 Frm 00002 Fmt 4701 Sfmt 4700 E:\FR\FM\14AUR2.SGM 14AUR2 tkelley on DSK3SPTVN1PROD with RULES2 Federal Register / Vol. 79, No. 157 / Thursday, August 14, 2014 / Rules and Regulations 47737 5. Parts E, F, and G: Imposition and Lifting 4. Notice to the Commission good faith by the fund’s board of of Liquidity Fees and Gates 5. Stress Testing directors (i.e., use a floating NAV).5 In 6. Part H: Optional Disclosure 6. Web Site Disclosure 1983, the Commission codified an 7. Timing of Form N–CR 7. Total Burden for Rule 2a–7 exemption to this requirement allowing 8. Economic Analysis B. Rule 22e–3 money market funds to value their G. Amendments to Form N–MFP Reporting C. Rule 30b1–7 and Form N–MFP Requirements 1. Discussion of Final Amendments portfolio securities using the ‘‘amortized 1. Amendments Related to Rule 2a–7 2. Current Burden cost’’ method of valuation and to use the Reforms 3. Change in Burden ‘‘penny-rounding’’ method of pricing.6 2. New Reporting Requirements D. Rule 30b1–8 and Form N–CR Under the amortized cost method, a 3. Clarifying Amendments 1. Discussion of New Reporting money market fund’s portfolio securities 4. Public Availability of Information Requirements generally are valued at cost plus any 5. Operational Implications of the N–MFP 2. Estimated Burden amortization of premium or Amendments E. Rule 34b–1(a) accumulation of discount, rather than at H. Amendments to Form PF Reporting F. Rule 482 Requirements their value based on current market G. Form N–1A factors.7 The penny rounding method of 1. Overview of Proposed Amendments to H. Advisers Act Rule 204(b)–1 and Form Form PF PF pricing permits a money market fund 2. Utility of New Information, Including 1. Discussion of Amendments when pricing its shares to round the Benefits, Costs, and Economic 2. Current Burden fund’s NAV to the nearest one percent Implications 3. Change in Burden (i.e., the nearest penny).8 Together, I. Diversification V. Regulatory Flexibility Act Certification these valuation and pricing techniques 1. Treatment of Certain Affiliates for VI. Update to Codification of Financial create a ‘‘rounding convention’’ that Purposes of Rule 2a–7’s Five Percent Reporting Policies permits a money market fund to sell and Issuer Diversification Requirement VII. Statutory Authority redeem shares at a stable share price 2. ABS—Sponsors Treated as Guarantors Text of Rules and Forms 3. The Twenty-Five Percent Basket without regard to small variations in the 9 J. Amendments to Stress Testing I.
Load more

Recommended publications
  • Money Market Fund Glossary
    MONEY MARKET FUND GLOSSARY 1-day SEC yield: The calculation is similar to the 7-day Yield, only covering a one day time frame. To calculate the 1-day yield, take the net interest income earned by the fund over the prior day and subtract the daily management fee, then divide that amount by the average size of the fund's investments over the prior day, and then multiply by 365. Many market participates can use the 30-day Yield to benchmark money market fund performance over monthly time periods. 7-Day Net Yield: Based on the average net income per share for the seven days ended on the date of calculation, Daily Dividend Factor and the offering price on that date. Also known as the, “SEC Yield.” The 7-day Yield is an industry standard performance benchmark, measuring the performance of money market mutual funds regulated under the SEC’s Rule 2a-7. The calculation is performed as follows: take the net interest income earned by the fund over the last 7 days and subtract 7 days of management fees, then divide that amount by the average size of the fund's investments over the same 7 days, and then multiply by 365/7. Many market participates can use the 7-day Yield to calculate an approximation of interest likely to be earned in a money market fund—take the 7-day Yield, multiply by the amount invested, divide by the number of days in the year, and then multiply by the number of days in question. For example, if an investor has $1,000,000 invested for 30 days at a 7-day Yield of 2%, then: (0.02 x $1,000,000 ) / 365 = $54.79 per day.
    [Show full text]
  • FEDERAL FUNDS Marvin Goodfriend and William Whelpley
    Page 7 The information in this chapter was last updated in 1993. Since the money market evolves very rapidly, recent developments may have superseded some of the content of this chapter. Federal Reserve Bank of Richmond Richmond, Virginia 1998 Chapter 2 FEDERAL FUNDS Marvin Goodfriend and William Whelpley Federal funds are the heart of the money market in the sense that they are the core of the overnight market for credit in the United States. Moreover, current and expected interest rates on federal funds are the basic rates to which all other money market rates are anchored. Understanding the federal funds market requires, above all, recognizing that its general character has been shaped by Federal Reserve policy. From the beginning, Federal Reserve regulatory rulings have encouraged the market's growth. Equally important, the federal funds rate has been a key monetary policy instrument. This chapter explains federal funds as a credit instrument, the funds rate as an instrument of monetary policy, and the funds market itself as an instrument of regulatory policy. CHARACTERISTICS OF FEDERAL FUNDS Three features taken together distinguish federal funds from other money market instruments. First, they are short-term borrowings of immediately available money—funds which can be transferred between depository institutions within a single business day. In 1991, nearly three-quarters of federal funds were overnight borrowings. The remainder were longer maturity borrowings known as term federal funds. Second, federal funds can be borrowed by only those depository institutions that are required by the Monetary Control Act of 1980 to hold reserves with Federal Reserve Banks.
    [Show full text]
  • Copyright by Judith A. Thomas 2012
    Copyright by Judith A. Thomas 2012 The Thesis Committee for Judith A. Thomas Certifies that this is the approved version of the following thesis: Live Stream Micro-Media Activism in the Occupy Movement Mediatized Co-presence, Autonomy, and the Ambivalent Face APPROVED BY SUPERVISING COMMITTEE: Supervisor: Karin Gwinn Wilkins Joseph D. Straubhaar Live Stream Micro-Media Activism in the Occupy Movement Mediatized Co-presence, Autonomy, and the Ambivalent Face by Judith A. Thomas, BFA Thesis Presented to the Faculty of the Graduate School of The University of Texas at Austin in Partial Fulfillment of the Requirements for the Degree of Master of Arts The University of Texas at Austin May 2012 Dedication For my husband, inspiration and co-conspirator, Rob Donald. (Photo: The First Adbusters’ Poster for Occupy Wall Street, September 2011. Acknowledgements The work of Manuel Castells on autonomous networks and communication power has had a profound impact on this scholarship. The breadth of his vision and theoretical analysis is inspiring and insightful. I hope this work contributes to the continuing critical cultural discussion of the potential of citizen micro-media in all contexts but especially the international uprisings of 2010-2012. Most especially, my sincere thanks to the following University of Texas at Austin professors whose knowledge and curiosity inspired me most: Joe Straubhaar, Paul Resta, Shanti Kumar, Sandy Stone, and especially my generous, gifted and patient supervisor, Karin Gwinn Wilkins. I will miss the depth and breadth of debate we shared, and I look forward to following your challenging work in the future. v Abstract Live Stream Micro-Media Activism in the Occupy Movement Mediatized Co-presence, Autonomy, and the Ambivalent Face Judith A.
    [Show full text]
  • Guaranteed Money Market Account
    GUARANTEED MONEY MARKET ACCOUNT As of 09/01/2021 GUARANTEED MONEY MARKET ACCOUNT RATES AND TERMS Annual Combined APY Minimum Interest Interest Rate Minimum Balance Monthly Percentage Yield (6 mos GMMA rate, Balance to Compounded (first 6 months) to Earn APY Fee (First 6 months) 6 mos MMA rate) Open and Credited 0.10% 0.10% 0.07% $0.00 Compounded 0.10% 0.10% 0.08% $10,000 Daily, $15,000.00 None 0.50% 0.50% 0.28% $15,000 Credited Monthly 0.50% 0.50% 0.29% $50,000 Eligibility: The Guaranteed Money Market Account is available to new memberships only, within first 30 days that membership is established. Minimum opening deposit of $15,000 must come from an institution other than Rivermark (New Money). Requires a new Free Checking Plus Account. Truth in Savings Disclosures 1. Rate Information – The Interest Rates and Annual Percentage Yields on your deposit account are stated above and may change at any time as determined by us, except as otherwise disclosed herein. The promotional APY is guaranteed for six months from the date of account opening. After the six-month promotional period ends, the account will convert to a Money Market Account with variable APYs in effect at time of conversion and based on the account balance as described on the applicable rate sheet. The APY is a percentage rate that reflects the total amount of interest to be paid on an account based on the interest rate and frequency of compounding for an annual period. The APY assumes that interest will remain on deposit until maturity.
    [Show full text]
  • Currency Risk Management
    • Foreign exchange markets • Internal hedging techniques • Forward rates Foreign Currency Risk • Forward contracts Management 1 • Money market hedging • Currency futures 00 M O NT H 00 100 Syllabus learning outcomes • Assess the impact on a company to exposure in translation transaction and economic risks and how these can be managed. 2 Syllabus learning outcomes • Evaluate, for a given hedging requirement, which of the following is the most appropriate strategy, given the nature of the underlying position and the risk exposure: (i) The use of the forward exchange market and the creation of a money market hedge (ii) Synthetic foreign exchange agreements (SAFE's) (iii) Exchange-traded currency futures contracts (iv) Currency options on traded futures (v) Currency swaps (vi) FOREX swaps 3 Syllabus learning outcomes • Advise on the use of bilateral and multilateral netting and matching as tools for minimising FOREX transactions costs and the management of market barriers to the free movement of capital and other remittances. 4 Foreign Exchange Risk (FOREX) The value of a company's assets, liabilities and cash flow may be sensitive to changes in the rate in the rate of exchange between its reporting currency and foreign currencies. Currency risk arises from the exposure to the consequences of a rise or fall in the exchange rate A company may become exposed to this risk by: • Exporting or importing goods or services • Having an overseas subsidiary • Being a subsidiary of an overseas company • Transactions in overseas capital market 5 Types of Foreign Exchange Risk (FOREX) Transaction Risk (Exposure) This relates to the gains or losses to be made when settlement takes place at some future date of a foreign currency denominated contract that has already been entered in to.
    [Show full text]
  • Nber Working Papers Series
    NBER WORKING PAPERS SERIES WAS THERE A BUBBLE IN THE 1929 STOCK MARKET? Peter Rappoport Eugene N. White Working Paper No. 3612 NATIONAL BUREAU OF ECONOMIC RESEARCH 1050 Massachusetts Avenue Cambridge, MA 02138 February 1991 We have benefitted from comments made on earlier drafts of this paper by seminar participants at the NEER Summer Institute and Rutgers University. We are particularly indebted to Charles Calomiris, Barry Eicherigreen, Gikas Hardouvelis and Frederic Mishkiri for their suggestions. This paper is part of NBER's research program in Financial Markets and Monetary Economics. Any opinions expressed are those of the authors and not those of the National Bureau of Economic Research. NBER Working Paper #3612 February 1991 WAS THERE A BUBBLE IN THE 1929 STOCK MARKET? ABSTRACT Standard tests find that no bubbles are present in the stock price data for the last one hundred years. In contrast., historical accounts, focusing on briefer periods, point to the stock market of 1928-1929 as a classic example of a bubble. While previous studies have restricted their attention to the joint behavior of stock prices and dividends over the course of a century, this paper uses the behavior of the premia demanded on loans collateralized by the purchase of stocks to evaluate the claim that the boom and crash of 1929 represented a bubble. We develop a model that permits us to extract an estimate of the path of the bubble and its probability of bursting in any period and demonstrate that the premium behaves as would be expected in the presence of a bubble in stock prices.
    [Show full text]
  • Money Market Funds V. Ultra-Short Bond Funds
    THE PENNSYLVANIA STATE UNIVERSITY SCHREYER HONORS COLLEGE DEPARTMENT OF FINANCE MONEY MARKET FUNDS VS. ULTRA-SHORT BOND FUNDS TIMOTHY NEUBERT FALL 2009 A thesis submitted in partial fulfillment of the requirements for a baccalaureate degree in Finance with honors in Finance Reviewed and approved by the following: James Alan Miles Professor of Finance Thesis Supervisor Honors Adviser Chris Muscarella Professor of Finance Faculty Reader *Signatures are on file in the Schreyer Honors College Abstract This thesis explores the investment vehicles known as Money Market Funds and Ultra-Short Bond Funds. Both types of funds are commonly used to invest short term cash savings as an alternative to a conventional bank savings account or certificate of deposit. Since both funds are marketed towards prospective investors to fulfill the same need, understanding the differences between the two will help individuals make better investment decisions. The key components of the two types of funds being explored will be their respective risk and return profiles, both historically and in the contemporary economic climate. i Table of Contents INTRODUCTION 1 MONEY MARKET FUNDS 2 Return Profile 2 Types of Money Market Funds 3 Regulations 5 Risk of Loss 6 ULTRA-SHORT BOND FUNDS 9 Return Structure 10 Risk of Loss 10 MONEY MARKET FUNDS VS. ULTRA-SHORT BOND FUNDS 16 Research Methods 16 Variance 17 Risk 18 Returns 19 CONCLUSION 22 i APPENDIX A 23 APPENDIX B 24 APPENDIX C 25 APPENDIX D 27 APPENDIX E 29 APPENDIX F 30 APPENDIX G 31 APPENDIX H 32 BIBLIOGRAPHY 34 Introduction I invite you to go to ridgeworth.com, the website of RidgeWorth Investments.
    [Show full text]
  • Popular Movements in Public Space a Geographical Analysis of Occupy Wall Street
    Department of Global Studies and Geography Popular Movements in Public Space A Geographical Analysis of Occupy Wall Street James Yantis Geography Honors Essay Advisor: Kari B. Jensen Received High Honors 2012 Contents Introduction .................................................................................................................................................. 2 Popular Movements...................................................................................................................................... 2 Beginning of OWS ......................................................................................................................................... 8 Methodology ............................................................................................................................................... 10 Regional Analysis......................................................................................................................................... 17 Public Space ................................................................................................................................................ 19 Public Identities ........................................................................................................................................... 24 Public eviction ............................................................................................................................................. 27 Concluding Remarks...................................................................................................................................
    [Show full text]
  • The Latest Fallacy About Money Market Funds
    The Latest Fallacy About Money Market Funds By Melanie L. Fein July 2012 CONTENTS I. THE LATEST FALLACY................................................................................1 A. “MMFs Threaten the Lending Ability of Banks” ...............................1 II. WHY IT’S A FALLACY..................................................................................3 A. MMFs Are Permitted to Invest Only in Short-Term High Quality Instruments, Not Bank Loans .................................................3 B. Banks Rely on Deposits, Not MMFs, To Make Loans.......................3 C. Banks Have Access to Other Sources of Funding and Liquidity..............................................................................................4 D. MMFs Purchase Commercial Paper Issued by Bank Holding Companies for Their Nonbanking Activities ......................................6 E. Commercial Paper Is Not an Appropriate Funding Source for Bank Loans .........................................................................................7 F. SEC Filings Show That MMFs Are Not a Primary Source of Funding for Bank Loans .....................................................................9 G. Numerous Factors Affect Banking Organizations’ Access to Funds.................................................................................................11 III. BANK FUNDING AND LIQUIDITY MANAGEMENT HAS BEEN DEFICIENT .................................................................................................14 A. Banking Regulators Have Acknowledged
    [Show full text]
  • Understanding Financial Management: a Practical Guide Guideline Answers to the Concept Check Questions
    Understanding Financial Management: A Practical Guide Guideline Answers to the Concept Check Questions Chapter 10 Raising Funds and Cost of Capital Concept Check 10.1 1. What are the three primary roles of financial markets? Explain. Financial markets serve three major functions. • Channel funds. Financial markets help channel funds from suppliers to demanders. Within an economy, some have a surplus of funds while others have a shortage of funds. Financial markets provide a mechanism to help move funds from those who have a surplus (suppliers) to those who have a shortage (demanders). Business firms are net users of funds. • Provide a resale market. Financial markets provide a resale market. Such markets provide liquidity by enabling the holder to convert an asset into cash with ease. If investors believe that liquidating the investment would be difficult or costly, they would be reluctant to commit funds. • Establish market prices and rates of return. Financial markets establish market prices and rates of return. Setting prices is difficult but occurs through the interaction of suppliers and demanders. Factors contributing to markets efficiently pricing securities include high volume, standardization of securities, and a concentration of traders. 2. What is the major difference between capital markets and money markets? Give two examples of securities in each market. A money market is a financial market for short-term debt instruments. Money markets have several distinguishing features. First, the original maturity of money market securities is one year or less from their original issue date. Second, money market securities do not trade in a physical location but through a network of wires, telephones, and computers connecting banks and dealers.
    [Show full text]
  • Revisions to Prohibitions and Restrictions on Proprietary Trading and Certain Interests In, and Relationships With, Hedge Funds and Private Equity Funds
    DEPARTMENT OF TREASURY Office of the Comptroller of the Currency 12 CFR Part 44 Docket No. OCC-2018-0010 RIN 1557-AE27 FEDERAL RESERVE SYSTEM 12 CFR Part 248 Docket No. R-1608 RIN 7100-AF 06 FEDERAL DEPOSIT INSURANCE CORPORATION 12 CFR Part 351 RIN 3064-AE67 SECURITIES AND EXCHANGE COMMISSION 17 CFR Part 255 Release no. BHCA-[#]; File no. [###] RIN 3235-AM10 COMMODITY FUTURES TRADING COMMISSION 17 CFR Part 75 RIN 3038-AE72 Revisions to Prohibitions and Restrictions on Proprietary Trading and Certain Interests in, and Relationships With, Hedge Funds and Private Equity Funds AGENCY: Office of the Comptroller of the Currency, Treasury (OCC); Board of Governors of the Federal Reserve System (Board); Federal Deposit Insurance Corporation (FDIC); Securities and Exchange Commission (SEC); and Commodity Futures Trading Commission (CFTC). ACTION: Final rule. SUMMARY: The OCC, Board, FDIC, SEC, and CFTC are adopting amendments to the regulations implementing section 13 of the Bank Holding Company Act. Section 13 contains certain restrictions on the ability of a banking entity and nonbank financial company supervised by the Board to engage in proprietary trading and have certain interests in, or relationships with, a hedge fund or private equity fund. These final amendments are intended to provide banking entities with clarity about what activities are prohibited and to improve supervision and implementation of section 13. DATES: Effective Date: The effective date for this release is January 1, 2020. Compliance Date: Banking entities must comply with the final amendments by January 1, 2021. The 2013 rule will remain in effect until the compliance date, and a banking entity must continue to comply with the 2013 rule.
    [Show full text]
  • Looking Back on 2013
    THIS WEEK IN WALL STREET REFORM December 28 – January 3, 2014 We encourage you to forward this weekly compilation to friends and colleagues. To subscribe, email [email protected], with “This Week” in the subject line LOOKING BACK ON 2013 Financial Reform Went Way Better than Expected Mike Konczal, New Republic, 12/29/13. “[N]obody thought that banks would face tougher holding requirements for capital, that regulations of the financial derivatives markets would advance, or that the final Volcker [Rule] would be a pretty good start instead of an incoherent mess. Yet that is what appears to have happened in 2013.” “JPMorgan had been leading the charge against reform, arguing that the effort was over-harsh and destructive, and that Wall Street had already cleaned up its act on its own. Indeed, the big concern in 2012 was that Wall Street would convince enough moderate Democrats that Dodd- Frank had gone too far… and Congress would stop regulatory action before it was even completed. This fell apart right alongside the multi-billion dollar losses in JPMorgan’s position. “Though small compared to Wall Street and the right, groups like Americans for Financial Reform and Better Markets show up extensively in the comments on the Volcker Rule. In the final rule, there are hundreds of references to the detailed comment letter the Occupy the SEC group sent. These groups didn’t exist before the crisis, and their existence is a major piece of what makes solid final rules happen.” Regulators Halfway Home on Dodd-Frank Peter Schroeder, The Hill, 1/2/14 “More than half of the Dodd-Frank financial reform law has been fully implemented three and a half years after its enactment.
    [Show full text]