On January 30, 2020, the Federal Reserve Board, OCC, FDIC, SEC and CFTC (the Agencies) proposed amendments to the covered fund provisions of the Volcker Rule. The proposed amendments address long-standing concerns with the over-broad definition of covered fund, the treatment of foreign funds (both public and private), and the
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Jai R. Massari
Ms. Massari is a partner in Davis Polk's Financial Institutions Group and the trading and markets practice, based in the Washington DC office. [Full Bio]
Encouraging Innovation: Brokered Deposits—What Fintechs Need to Know to Partner with Banks under the FDIC’s Proposed Regulations
In a step forward for the digital transformation of banking and partnerships between banks and FinTechs, the FDIC released proposed changes to its brokered deposit regulations in late December 2019. The proposed changes are designed to update the regulatory framework as much as possible within the constraints of the existing…
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Client Memorandum: FSOC Shift to an Activities-Based Approach Signals an Emphasis on the Risks to Financial Stability from Digital Transformation
The Financial Stability Oversight Council’s (FSOC) recently revised guidelines (the 2019 Guidelines) on how it will identify and address financial stability risks are a major shift from the guidelines it issued in the immediate aftermath of the Financial Crisis. The 2019 Guidelines draw upon lessons learned from…
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NYDFS Proposes a Streamlined Approval Process for Services in New Virtual Currencies
Building upon its BitLicense regime instituted in 2015, the New York State Department of Financial Services (NYDFS) has proposed two mechanisms by which entities that hold BitLicenses or trust charters with virtual currency authority (VC Licensees) may list or provide other approved services in a…
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Visual Memorandum: Final Tailoring Rules for U.S. Banking Organizations
The U.S. banking agencies have completed one of the most important steps towards rebalancing the U.S. bank regulatory framework since the Dodd-Frank Act was passed in the wake of the 2007 – 2008 financial crisis. The agencies have adopted final rules to tailor enhanced prudential standards and U.S. Basel III…
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U.S. Federal Banking Regulators Propose a Madden Fix
Since the 2016 Second Circuit decision in Madden v. Midland Funding, LLC,[1] banks and their non-bank lending partners have faced legal uncertainty about their ability to assign or transfer loans. The Madden decision and subsequent actions by state courts have called into question the “valid-when-made” doctrine, which stands…
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“Off the Rack”: Federal Reserve Finalizes Tailoring Rules with Few Changes
The Federal Reserve has finalized its rules to further tailor the regulatory framework for enhanced prudential standards and the U.S. Basel III capital and liquidity requirements applicable to domestic banking organizations and foreign banking organizations (Final Tailoring Rules). Compared to the proposed rules that the U.S. banking agencies…
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Davis Polk Client Memorandum: Federal Reserve Announces Plan to Build Its Own Real-Time Gross Settlement System for Retail Payments
The Federal Reserve has announced that it plans to build its own 24x7x365 real-time gross settlement (RTGS) system for retail payments, called the FedNow Service. In a 4-1 decision, with Vice Chairman for Supervision Quarles dissenting, the Federal Reserve stated that the FedNow Service would allow consumers and…
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Davis Polk Client Memorandum: Agencies Extend Volcker Rule Relief for Qualifying Foreign Excluded Funds
As widely expected, the Volcker Agencies extended relief from the Volcker Rule that was first granted to eligible foreign funds in 2017. The agencies’ action provides that the proprietary trading and covered fund prohibitions of the Volcker Rule do not apply: (1) to a foreign banking entity for activities or…
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Davis Polk Client Memorandum: Volcker Agencies Implement Small-Bank Exclusion and Name-Sharing Provisions of EGRRCPA
The Federal Reserve, OCC, FDIC, SEC and CFTC adopted final amendments on July 9, 2019 implementing the small-bank exclusion and name-sharing provisions of the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA). The final amendments modify the definition of “insured depository institution” and also permit a covered…
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