Dodd-Frank Act

OCC Proposed Annual Stress Test Reporting Requirements for Large Covered Institutions

On August 16, pursuant to Section 165(i)(2) of the Dodd-Frank Act, the OCC issued a notice of a proposed information collection regarding annual stress test reporting for Covered Institutions with total consolidated assets of $50 billion or more.  Comments on the notice must be submitted by October 15.  OCC Release.   FPRA Notice.   

CFTC Proposed Clearing Exemption for Swaps Between Affiliates

On August 16, the CFTC proposed an exemption from clearing requirements under Section 723 of the Dodd-Frank Act for swaps between certain affiliated entities within a corporate group.  The proposed exemption would be limited to swaps between majority-owned affiliates and would require centralized risk management, swap trading relationship documentation, variation margin payments, and satisfaction of certain reporting requirements.  Comments on the proposed rule must be submitted within 30 days of publication in the Federal Register.  CFTC Release.  CFTC Proposed Rule.   

SEC Rule for Listing Standards for Compensation Committees and Advisers

On June 20, the SEC approved a rule that directs national securities exchanges to adopt listing standards for public company boards and compensation advisers. The new rule, required by the Dodd-Frank Act, requires exchange listing standards to address: (i) the independence of members on a committee; (ii) the committee’s authority to retain compensation advisers; (iii) the committee’s consideration of the independence of any compensation advisers; and (iv) the committee’s responsibility for the appointment, compensation, and oversight of the work of any compensation adviser. These changes will take effect 30 days after publication in the Federal Register. No later than 90 days after effectiveness, each exchange that lists equity securities must propose listing standards that comply with the new rule. The new listing standards must be approved by the SEC within one year of the new rule becoming effective. SEC Release.  Rule.

SEC Proposed Sequencing of Derivatives Regulation

On June 11, the SEC issued a policy statement and request for comment on the anticipated sequencing of compliance dates of final rules to be adopted by the SEC pursuant to certain provisions of Title VII of the Dodd-Frank Act, regarding the regulation of security-based swaps and security-based swap market participants under the Exchange Act. Comments must be submitted on or before 60 days from publication in the Federal Register. SEC Release.  Policy Statement with Request for Comment.

OCC, Fed and FDIC Proposed Capital Rules

On June 12, the OCC, Fed, and FDIC announced that they are seeking comment on three notices of proposed rulemaking (NPRs) that would revise and replace the agencies’ current capital rules. In the first Basel III NPR, the agencies propose to revise their risk-based and leverage capital requirements consistent with agreements reached by the Basel Committee on Banking Supervision. The second Basel III NPR would revise the agencies’ prompt corrective action framework by incorporating the new regulatory capital minimums and updating the definition of tangible common equity. In the third capital NPR, the agencies propose to revise and harmonize rules for calculating risk-weighted assets to enhance risk sensitivity and address weaknesses identified over recent years, including by incorporating aspects of the Basel II standardized framework, and alternatives to credit ratings, consistent with section 939A of the Dodd-Frank Act. Comments on the three NPRs are requested by September 7. The agencies also announced the finalization of the market risk capital rule that was proposed in 2011, which will be effective on January 1, 2013.  Joint Release.

CFTC Rule on Swap Data Recordkeeping and Reporting

On May 18, the CFTC published a final rule on swap data recordkeeping and reporting requirements for counterparties to historical swaps. Historical swaps are those swaps executed either: (i) prior to the enactment of the Dodd-Frank Act or (ii) between the date of enactment of the Dodd-Frank Act and the applicable compliance date for swap data recordkeeping and reporting. CFTC Release.

CFTC Final Rules on Designated Contract Markets

On May 10, pursuant to Sections 735 and 723 of the Dodd-Frank Act, the CFTC adopted new and revised rules, guidance and acceptable practices governing the designation and operation of designated contract markets. The final rules, guidance and acceptable practices will be effective 60 days after publication in the Federal Register.  CFTC Fact Sheet.  CFTC Q&A.

CFTC Vote on Dodd-Frank Indemnification and Confidentiality Provisions

On May 1, the CFTC voted to issue a proposed interpretative statement to clarify that, in certain instances, foreign regulators are exempt from requirements under the Dodd-Frank Act to enter into confidentiality and indemnification agreements with Swap Data Repositories in connection with its access to swap data.  Comments may be submitted for 30 days from publication in the Federal Register.  CFTC Release.