Posts by: Amy Chan

Rating Agency Developments

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On November 20, DBRS issued a report outlining its methodology for rating European Structured Finance Transactions. Release

On November 19, Fitch issued rating criteria for Dealer Floorplan ABS. Release

On November 19, Moody’s issued a revised methodology for rating UK Income-Contingent-Repayment Student Loan-Backed ABS. Release

On November 19, Moody’s issued a global approach for rating ABS Backed by Production-Dependent Solar Contracts. Release

On November 15, DBRS issued a report outlining its methodology for rating Canadian Trade Receivables Securitization Transactions. Release

On November 15, Moody’s issued a revised methodology for rating Covered Bonds. Release

On November 15, Moody’s issued a revised methodology for monitoring Scheduled Amortization UK Student Loan-Backed Securities. Release

On November 15, Moody’s issued a revised methodology for rating Insurance Premium Finance-Backed Securities. Release READ MORE →

CFTC Approves a Final Rule to Amend Uncleared Swap Margin Requirements

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On November 19, the Commodity Futures Trading Commission (“CFTC”) announced that it approved a final rule to amend its uncleared swap margin requirements to better align with certain rules adopted by the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency that impose restrictions on certain qualified financial contracts. Press release. Rule.

Rating Agency Developments

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On October 3, DBRS published a report entitled Master European Residential Mortgage-Backed Securities Rating Methodology and Jurisdictional Addenda. Report.

On October 2, DBRS published a report entitled European RMBS Insight: Spanish Addendum. Report.

On October 2, Fitch published a report entitled Exposure Draft: U.S. RMBS Surveillance and Re-REMIC Rating Criteria. Report.

On September 28, DBRS published a report entitled European CMBS Rating and Surveillance Methodology. Report.

On September 28, Fitch published a report entitled CMBS Large Loan Rating Criteria. Report.

On September 27, DBRS published a report entitled Rating Structured Finance CDO Restructurings. Report.

On September 27, DBRS published a report entitled Cash Flow Assumptions for Corporate Credit Securitizations. Report.

On September 27,  DBRS published a report entitled Rating CLOs and CDOs of Large Corporate Credit. Report.

On September 27, DBRS published a report entitled Trade Receivables. Report.

On September 27, DBRS published a report entitled Subscription Loans (Capital Call). Report.

On September 27, DBRS published a report entitled Rating U.S. Collateralized Fund Obligations Backed by Private Equity. Report.

On September 27, DBRS published a report entitled Rating U.S. Timeshare Loan Securitizations. Report.

On September 27, DBRS published a report entitled Rating U.S. Wholesale Securitizations. Report.

On September 27, DBRS published a report entitled Rating U.S. Structured Finance Transactions. Report.

On September 27, DBRS published a report entitled Rating U.S. Retail Auto Loan Securitizations. Report.

On September 27, DBRS published a report entitled Rating U.S. Federal Family Education Loan Program Securitizations. Report.

On September 27, DBRS published a report entitled RMBS Insight 1.3: U.S. Residential Mortgage-Backed Securities Model and Rating Methodology. Report.

On September 27, DBRS published a report entitled Rating and Monitoring U.S. RMBS Servicing Advance Transactions. Report.

On September 27, DBRS published a report entitled U.S. RMBS Surveillance Methodology. Report

On September 27, DBRS published a report entitled Rating U.S. Equipment Lease and Loan Securitization. Report.

On September 27, DBRS published a report entitled Rating U.S. Credit Card Asset-Backed Securities. Report.

On September 27, DBRS published a report entitled Rating U.S. Auto Lease Securitizations. Report.

On September 27, DBRS published a report entitled Rating U.S. Auto Fleet Lease Securitizations. Report.

On September 27, DBRS published a report entitled Rating U.S. Structured Settlements Asset-Backed Securitizations. Report.

On September 27, DBRS published a report entitled Rating U.S. Private Student Loan Securitizations. Report.

On September 27, DBRS published a report entitled Rating U.S. Film Rights Securitizations. Report.

On September 27, DBRS published a report entitled Rating Pooled Aircraft Lease Securitizations. Report.

On September 27, DBRS published a report entitled Rating Marine Container Securitizations. Report.

On September 27, DBRS published a report entitled Legal Criteria for U.S. Structured Finance. Report.

On September 27, DBRS published a report entitled DBRS Master U.S. ABS Surveillance Methodology. Report.

On September 27, DBRS published a report entitled North American CMBS Multi-borrower Rating Methodology. Report.

On September 27, DBRS published a report entitled North American Single-Asset/Single-Borrower Methodology. Report.

On September 27, DBRS published a report entitled North American CMBS Surveillance Methodology. Report.

On September 27, DBRS published a report entitled Interest Rate Stresses for U.S. Structured Finance Transactions. Report.

Federal Agencies Issue a Joint Statement on Banks and Credit Unions Sharing Resources to Improve Efficiency and Effectiveness of Bank Secrecy Act Compliance

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On October 3, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the National Credit Union Administration, the Office of the Comptroller of the Currency and the U.S. Department of the Treasury’s Financial Crimes Enforcement Network issued a statement to address instances in which certain banks and credit unions may decide to enter into collaborative arrangements to share resources to manage their Bank Secrecy Act and anti-money laundering obligations more efficiently and effectively. Joint Statement.

Rating Agency Developments

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On June 8, 2018, Moody’s published a report entitled: US Public Housing Authority Capital Fund Bonds. Release.

On June 8, 2018, Moody’s published a report entitled: Distribution & Supply Chain Services Industry. Release.

On June 8, 2018, Moody’s published a report entitled: Regulated Water Utilities. Release.

On June 5, S&P published guidance related to its publication “Foreign Exchange Risk In Structured Finance—Methodology And Assumptions”. Release.

On June 6, Moody’s updated its rating methodology for Government-Related Issuers. Release.

On June 1, KBRA published its rating methodology for U.S. Property Assessed Clean Energy (PACE) ABS. Release.

On May 31, Fitch published an addendum describing Fitch’s approach to analyzing derivative counterparty exposure in structured finance transactions rated on a long-term basis. Release.

FHFA Issues Proposed Rule on Enterprise Capital

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On June 12, 2018, the Federal Housing Finance Agency (“FHFA“) issued a proposed regulation on capital requirements for Fannie Mae and Freddie Mac (the Enterprises). The proposed rule would implement a new framework for risk-based capital requirements and a revised minimum leverage capital requirement for the Enterprises. FHFA suspended regulatory capital requirements after placing the Enterprises into conservatorships in September 2008 and the capital requirements in this rule would also be suspended while the Enterprises remain in conservatorship. Comments on this proposal will be accepted for 60 days after publication in the Federal Register. Press Release. Proposed Rule. Fact Sheet.

Rating Agency Developments

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On April 12, 2018, DBRS published a report entitled: European RMBS Insight Methodology.  Release

On April 12, 2018, Moody’s published its methodology for rating US States and Territories.  Release

On April 13, 2018, DBRS published a report entitled: Rating Canadian Structured Finance Transactions.  Release

On April 17, 2018, S&P published additional guidance on its European residential loans criteria.  Release

On April 17, 2018, Fitch updated its criteria for estimating losses on U.S. mortgage pools for RMBS transactions. Release

Agencies Propose Transition of New CECL Accounting Standard into Regulatory Capital Framework

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On April 17, 2018, the federal banking agencies proposed a revision to their regulatory capital rules to address and provide an option to phase in the regulatory capital effects of the new accounting standard for credit losses, known as the “Current Expected Credit Losses” (“CECL“) methodology. The proposal addresses the regulatory capital treatment of credit loss allowances under the CECL methodology and would allow banking organizations to phase in the day-one regulatory capital effects of CECL adoption over three years. The proposal would revise the agencies’ regulatory capital rules and other rules to take into consideration differences between the new accounting standard and existing U.S. generally accepted accounting principles. Comments on this proposal will be accepted for 60 days after publication in the Federal Register. Press Release. Proposed Rule.

SEC Proposes to Enhance Protections and Preserve Choice for Retail Investors in Their Relationships with Investment Professionals

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On April 18, the Securities and Exchange Commission (“SEC“) voted to propose a package of rulemakings and interpretations consisting of more than 900 pages that are “designed to enhance the quality and transparency of investors’ relationships with investment advisers and broker-dealers while preserving access to a variety of types of advice relationships and investment products.”

As stated in the Commission’s Press Release announcing this action: “Under proposed Regulation Best Interest, a broker-dealer would be required to act in the best interest of a retail customer when making a recommendation of any securities transaction or investment strategy involving securities to a retail customer.  Regulation Best Interest is designed to make it clear that a broker-dealer may not put its financial interests ahead of the interests of a retail customer in making recommendations.”

The Commission also proposed an interpretation to reaffirm and, in some cases, clarify its views of the fiduciary duty that investment advisers owe to their clients.

In addition, the Commission proposed to help address “investor confusion” regarding the nature of their relationships with investment professionals through a new short-form disclosure document dubbed “a customer or client relationship summary” (a “CRS“). The Commission stated that it believes that Form CRS would provide retail investors with “simple, easy-to-understand information” about the nature of their relationship with their investment professional, and would supplement other more detailed disclosures.

Finally, the Commission proposed to restrict certain broker-dealers and their financial professionals from using the terms “adviser” or “advisor” as part of their name or title with retail investors.

In proposing these new regulations the Commission added that: “Taken as a whole, the proposed rules and interpretations would enhance investor protection by applying consistent principles to investment advisers and broker-dealers: provide clear disclosures, exercise due care, and address conflicts of interest. The specific obligations of investment advisers and broker-dealers would be, however, tailored to the differences in the types of advice relationships that they offer.

The public comment period will remain open for 90 days following publication of the documents in the Federal Register.

Proposed Rules: Regulation Best Interest. Form CRS Relationship Summary.

Proposed Interpretation: Standard Conduct for Investment Advisers.

Rating Agency Developments

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On December 13, 2017, DBRS published a report entitled: Canadian Surveillance Methodology for CDOs of Large Corporate Credit. Report.

On December 12, 2017, Fitch published a report entitled: Exposure Draft: Non-Bank Financial Institutions Rating Criteria. Report.

On December 12, 2017, Fitch published a report entitled: Exposure Draft: Bank Rating Criteria. Report.

On December 12, 2017, DBRS published a report entitled: Operational Risk Assessment for U.S. RMBS Servicers. Report.

On December 12, 2017, DBRS published a report entitled: Operational Risk Assessment for U.S. RMBS Originators. Report.

On December 7, 2017, Fitch published a report entitled: Latin America RMBS Rating Criteria. Report.