On October 9, the Internal Revenue Service (IRS) proposed regulations to eliminate tax issues that might otherwise arise due to the modification of instruments and transactions as a result of discontinuation of interbank offered rates (IBORs) used in debt instruments and non-debt contracts (such as derivatives). Under current rules, material alteration of the terms of instruments and contracts can result in tax events, including the realization of gain or loss for income tax purposes.

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On September 17, the directors of the Federal Deposit Insurance Corporation (FDIC) approved a joint notice of proposed rulemaking (NPR) with respect to the prudential regulator margin rules for non-cleared swaps. The joint form of the NPR indicates that the other prudential swap regulators (the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, the Farm Credit Administration and the Federal Housing Finance Agency) will all be approving the same NPR in the near future.
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On August 20, the Board of Directors of the Federal Deposit Insurance Corporation (FDIC) approved their version of a set of amendments intended to simplify some of the requirements of the regulations implementing Section 13 of the Bank Holding Company Act of 1956 (the “Volcker Rule”), which was enacted as Section 619 of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The Volcker Rule generally prohibits banking entities from engaging in proprietary trading and from owning or controlling hedge funds or private equity funds subject to numerous qualifications and exemptions set forth in the Volcker Rule regulations, which are identical sets of rules adopted by each of the Volcker Rule regulators (the FDIC, the Office of the Comptroller of the Currency (OCC), the Board of Governors of the Federal Reserve System (Federal Reserve), the Commodity Futures Trading Commission (CFTC), and the Securities and Exchange Commission). These final amendments incorporate the responses of the Volcker Rule regulators to the numerous comments they received when they initially proposed a set of amendments in 2018.
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On April 29, Commodity Futures Trading Commission Chairman Chris Giancarlo sent a letter to Randy Quarles, the Vice Chair for Supervision of the Board of Governors of the Federal Reserve System, in which he proposed that the US regulators responsible for the administering the margin rules for uncleared swaps should collaborate in providing some relief to non-dealer swap market participants who may become subject to initial margin requirements in 2020. The specific relief would be the issuance of the same guidance issued by the Basel Committee on Banking Supervision (BCBS) and the International Organization of Securities Commissions (IOSCO) in March (for more information, see the March 8, 2019 edition of Corporate & Financial Weekly Digest), which stated that in-scope parties do not have to put in place compliant documentation and custodial relationships if there is no expectation that the exposure associated with their swaps will actually exceed the regulatory threshold for posting initial margin ($50 million for the United States).
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On March 4, the Consumer Financial Protection Bureau (CFPB) released an Advanced Notice of Proposed Rulemaking (ANPR) to seek information from the public about certain issues related to Property Assessed Clean Energy (PACE) financing. In particular, the CFPB issued the ANPR to obtain more information (1) about the relationship between an assessment of a consumer’s “ability to repay” and the terms of a PACE financing agreement, and (2) related to the extension of Truth In Lending Act (TILA) general civil liability to PACE transactions.

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The Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency (the agencies) are inviting public comment on a proposal that would implement a new approach for calculating the exposure amount of derivative contracts under the agencies’ regulatory capital rule.
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The Alternate Reference Rates Committee, operating under the auspices of the Federal Reserve, has published two consultations concerning the replacement of the London Inter-bank Offered Rate (LIBOR) in financial contracts. One consultation deals with floating rate notes and the other deals with syndicated business loans. The consultations contain draft fallback provisions for contracts referencing LIBOR that are intended to minimize disruption when the calculation of LIBOR, in its current form, is discontinued or the rate is no longer usable as a practical matter.
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On October 3, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Financial Crimes Enforcement Network, the National Credit Union Administration and the Office of the Comptroller of the Currency released a joint statement related to the permissible sharing of Bank Secrecy Act (BSA) resources.

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On July 17, the Federal Register published proposed changes to the Volcker Rule that were jointly approved by the Federal Reserve Board, the Commodity Futures Trading Commission, the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency and the Securities and Exchange Commission. As described in greater detail in the June 1,