trust preferred securities

Three Agencies Issue FAQ Regarding CDOs Backed by Trust Preferred Securities Under the Volcker Rule

On December 19, Fed, FDIC and OCC issued Frequently Asked Questions to clarify rules applicable to investments in covered funds and whether collateralized debt obligations backed by trust preferred securities (TruPS CDOs) could be determined to be covered funds under the Volcker Rule.  The FAQs clarify that banking entities that have holdings in TruPS CDOs may use the conformance period to determine if they can be brought into conformance by July 21, 2015ReleaseFAQ.

Agencies are Reviewing Treatment of CDOs Backed by Trust Preferred Securities Under the Volcker Rule

On December 27, the Fed, FDIC, OCC and the SEC stated that they are in the process of reviewing whether it would be appropriate to subject collateralized debt obligations backed by trust preferred securities to the Volcker rule.  The agencies intend to address the matter no later than January 15, 2014Statement.