350
(1) IN GENERAL.—Section 11(e)(8) of the Fed-
eral Deposit Insurance Act (12 U.S.C. 1821(e)(8)) 
is amended—
(A) in subparagraph (E), by striking 
‘‘other than paragraph (12) of this subsection, 
subsection (d)(9)’’ and inserting ‘‘other than 
subsections (d)(9) and (e)(10)’’; and 
(B) by adding at the end the following new 
subparagraphs: 
‘‘(F) CLARIFICATION.—No provision of law 
shall be construed as limiting the right or 
power of the Corporation, or authorizing any 
court or agency to limit or delay, in any man-
ner, the right or power of the Corporation to 
transfer any qualified financial contract in ac-
cordance with paragraphs (9) and (10) of this 
subsection or to disaffirm or repudiate any such 
contract in accordance with subsection (e)(1) of 
this section. 
‘‘(G) WALKAWAY
CLAUSES
NOT
EFFEC-
TIVE.—
‘‘(i) IN
GENERAL.—Notwithstanding 
the provisions of subparagraphs (A) and 
(E), and sections 403 and 404 of the Fed-
eral Deposit Insurance Corporation Im-
351
provement Act of 1991, no walkaway 
clause shall be enforceable in a qualified fi-
nancial contract of an insured depository 
institution in default. 
‘‘(ii) WALKAWAY CLAUSE DEFINED.—
For purposes of this subparagraph, the 
term ‘walkaway clause’ means a provision 
in a qualified financial contract that, after 
calculation of a value of a party’s position 
or an amount due to or from 1 of the par-
ties in accordance with its terms upon ter-
mination, liquidation, or acceleration of the 
qualified financial contract, either does not 
create a payment obligation of a party or 
extinguishes a payment obligation of a 
party in whole or in part solely because of 
such party’s status as a nondefaulting 
party.’’. 
(2) TECHNICAL
AND
CONFORMING
AMEND-
MENT.—Section 11(e)(12)(A) of the Federal Deposit 
Insurance Act (12 U.S.C. 1821(e)(12)(A)) is amend-
ed by inserting ‘‘or the exercise of rights or powers 
by’’ after ‘‘the appointment of’’. 
(b) NATIONAL
CREDIT
UNION
ADMINISTRATION 
BOARD.—
352
(1) IN
GENERAL.—Section 207(c)(8) of the 
Federal Credit Union Act (12 U.S.C. 1787(c)(8)) is 
amended—
(A) in subparagraph (E) (as amended by 
section 901(h)), by striking ‘‘other than para-
graph (12) of this subsection, subsection 
(b)(9)’’ and inserting ‘‘other than subsections 
(b)(9) and (c)(10)’’; and 
(B) by adding at the end the following new 
subparagraphs: 
‘‘(F) CLARIFICATION.—No provision of law 
shall be construed as limiting the right or 
power of the Board, or authorizing any court or 
agency to limit or delay, in any manner, the 
right or power of the Board to transfer any 
qualified financial contract in accordance with 
paragraphs (9) and (10) of this subsection or to 
disaffirm or repudiate any such contract in ac-
cordance with subsection (c)(1) of this section. 
‘‘(G) WALKAWAY
CLAUSES
NOT
EFFEC-
TIVE.—
‘‘(i) IN
GENERAL.—Notwithstanding 
the provisions of subparagraphs (A) and 
(E), and sections 403 and 404 of the Fed-
eral Deposit Insurance Corporation Im-
353
provement Act of 1991, no walkaway 
clause shall be enforceable in a qualified fi-
nancial contract of an insured credit union 
in default. 
‘‘(ii) WALKAWAY CLAUSE DEFINED.—
For purposes of this subparagraph, the 
term ‘walkaway clause’ means a provision 
in a qualified financial contract that, after 
calculation of a value of a party’s position 
or an amount due to or from 1 of the par-
ties in accordance with its terms upon ter-
mination, liquidation, or acceleration of the 
qualified financial contract, either does not 
create a payment obligation of a party or 
extinguishes a payment obligation of a 
party in whole or in part solely because of 
such party’s status as a nondefaulting 
party.’’. 
(2) TECHNICAL
AND
CONFORMING
AMEND-
MENT.—Section 207(c)(12)(A) of the Federal Credit 
Union Act (12 U.S.C. 1787(c)(12)(A)) is amended 
by inserting ‘‘or the exercise of rights or powers by’’ 
after ‘‘the appointment of’’.
354
SEC. 903. AMENDMENTS RELATING TO TRANSFERS OF 
QUALIFIED FINANCIAL CONTRACTS. 
(a) FDIC-INSURED DEPOSITORY INSTITUTIONS.—
(1) TRANSFERS
OF
QUALIFIED
FINANCIAL 
CONTRACTS TO FINANCIAL INSTITUTIONS.—Section 
11(e)(9) of the Federal Deposit Insurance Act (12 
U.S.C. 1821(e)(9)) is amended to read as follows: 
‘‘(9) TRANSFER OF QUALIFIED FINANCIAL CON-
TRACTS.—
‘‘(A) IN GENERAL.—In making any trans-
fer of assets or liabilities of a depository institu-
tion in default which includes any qualified fi-
nancial contract, the conservator or receiver for 
such depository institution shall either—
‘‘(i) transfer to one financial institu-
tion, other than a financial institution for 
which a conservator, receiver, trustee in 
bankruptcy, or other legal custodian has 
been appointed or which is otherwise the 
subject of a bankruptcy or insolvency pro-
ceeding—
‘‘(I) all qualified financial con-
tracts between any person or any af-
filiate of such person and the deposi-
tory institution in default;
355
‘‘(II) all claims of such person or 
any affiliate of such person against 
such depository institution under any 
such contract (other than any claim 
which, under the terms of any such 
contract, is subordinated to the claims 
of general unsecured creditors of such 
institution); 
‘‘(III) all claims of such deposi-
tory institution against such person or 
any affiliate of such person under any 
such contract; and 
‘‘(IV) all property securing or 
any other credit enhancement for any 
contract described in subclause (I) or 
any claim described in subclause (II) 
or (III) under any such contract; or 
‘‘(ii) transfer none of the qualified fi-
nancial contracts, claims, property or other 
credit enhancement referred to in clause (i) 
(with respect to such person and any affil-
iate of such person).
‘‘(B) TRANSFER TO FOREIGN BANK, FOR-
EIGN FINANCIAL INSTITUTION, OR BRANCH OR 
AGENCY OF A FOREIGN BANK OR FINANCIAL IN-
356
STITUTION.—In transferring any qualified fi-
nancial contracts and related claims and prop-
erty under subparagraph (A)(i), the conservator 
or receiver for the depository institution shall 
not make such transfer to a foreign bank, fi-
nancial institution organized under the laws of 
a foreign country, or a branch or agency of a 
foreign bank or financial institution unless, 
under the law applicable to such bank, financial 
institution, branch or agency, to the qualified 
financial contracts, and to any netting contract, 
any security agreement or arrangement or other 
credit enhancement related to one or more 
qualified financial contracts, the contractual 
rights of the parties to such qualified financial 
contracts, netting contracts, security agree-
ments or arrangements, or other credit en-
hancements are enforceable substantially to the 
same extent as permitted under this section. 
‘‘(C) TRANSFER OF CONTRACTS SUBJECT 
TO
THE
RULES
OF
A
CLEARING
ORGANIZA-
TION.—In the event that a conservator or re-
ceiver transfers any qualified financial contract 
and related claims, property, and credit en-
hancements pursuant to subparagraph (A)(i)
357
and such contract is cleared by or subject to the 
rules of a clearing organization, the clearing or-
ganization shall not be required to accept the 
transferee as a member by virtue of the trans-
fer. 
‘‘(D) DEFINITIONS.—For purposes of this 
paragraph, the term ‘financial institution’ 
means a broker or dealer, a depository institu-
tion, a futures commission merchant, or any 
other institution, as determined by the Corpora-
tion by regulation to be a financial institution, 
and the term ‘clearing organization’ has the 
same meaning as in section 402 of the Federal 
Deposit Insurance Corporation Improvement 
Act of 1991.’’. 
(2) NOTICE
TO
QUALIFIED
FINANCIAL
CON-
TRACT COUNTERPARTIES.—Section 11(e)(10)(A) of 
the Federal Deposit Insurance Act (12 U.S.C. 
1821(e)(10)(A)) is amended in the material imme-
diately following clause (ii) by striking ‘‘the conser-
vator’’ and all that follows through the period and 
inserting the following: ‘‘the conservator or receiver 
shall notify any person who is a party to any such 
contract of such transfer by 5:00 p.m. (eastern time) 
on the business day following the date of the ap-
358
pointment of the receiver in the case of a receiver-
ship, or the business day following such transfer in 
the case of a conservatorship.’’. 
(3) RIGHTS AGAINST RECEIVER AND CONSER-
VATOR AND TREATMENT OF BRIDGE BANKS.—Sec-
tion 11(e)(10) of the Federal Deposit Insurance Act 
(12 U.S.C. 1821(e)(10)) is amended—
(A) by redesignating subparagraph (B) as 
subparagraph (D); and 
(B) by inserting after subparagraph (A) 
the following new subparagraphs: 
‘‘(B) CERTAIN
RIGHTS
NOT
ENFORCE-
ABLE.—
‘‘(i) RECEIVERSHIP.—A person who is 
a party to a qualified financial contract 
with an insured depository institution may 
not exercise any right that such person has 
to terminate, liquidate, or net such con-
tract under paragraph (8)(A) of this sub-
section or section 403 or 404 of the Fed-
eral Deposit Insurance Corporation Im-
provement Act of 1991, solely by reason of 
or incidental to the appointment of a re-
ceiver for the depository institution (or the 
insolvency or financial condition of the de-
359
pository institution for which the receiver 
has been appointed)—
‘‘(I) until 5:00 p.m. (eastern 
time) on the business day following 
the date of the appointment of the re-
ceiver; or 
‘‘(II) after the person has re-
ceived notice that the contract has 
been transferred pursuant to para-
graph (9)(A). 
‘‘(ii) CONSERVATORSHIP.—A person 
who is a party to a qualified financial con-
tract with an insured depository institution 
may not exercise any right that such per-
son has to terminate, liquidate, or net such 
contract under paragraph (8)(E) of this 
subsection or section 403 or 404 of the 
Federal Deposit Insurance Corporation 
Improvement Act of 1991, solely by reason 
of or incidental to the appointment of a 
conservator for the depository institution 
(or the insolvency or financial condition of 
the depository institution for which the 
conservator has been appointed).
360
‘‘(iii) NOTICE.—For purposes of this 
paragraph, the Corporation as receiver or 
conservator of an insured depository insti-
tution shall be deemed to have notified a 
person who is a party to a qualified finan-
cial contract with such depository institu-
tion if the Corporation has taken steps 
reasonably calculated to provide notice to 
such person by the time specified in sub-
paragraph (A). 
‘‘(C) TREATMENT
OF
BRIDGE
BANKS.—
The following institutions shall not be consid-
ered to be a financial institution for which a 
conservator, receiver, trustee in bankruptcy, or 
other legal custodian has been appointed or 
which is otherwise the subject of a bankruptcy 
or insolvency proceeding for purposes of para-
graph (9): 
‘‘(i) A bridge bank. 
‘‘(ii) A depository institution orga-
nized by the Corporation, for which a con-
servator is appointed either—
‘‘(I) immediately upon the orga-
nization of the institution; or
361
‘‘(II) at the time of a purchase 
and assumption transaction between 
the depository institution and the Cor-
poration as receiver for a depository 
institution in default.’’. 
(b) INSURED CREDIT UNIONS.—
(1) TRANSFERS OF QUALIFIED FINANCIAL CON-
TRACTS
TO
FINANCIAL
INSTITUTIONS.—Section 
207(c)(9) of the Federal Credit Union Act (12 
U.S.C. 1787(c)(9)) is amended to read as follows: 
‘‘(9) TRANSFER OF QUALIFIED FINANCIAL CON-
TRACTS.—
‘‘(A) IN GENERAL.—In making any trans-
fer of assets or liabilities of a credit union in 
default which includes any qualified financial 
contract, the conservator or liquidating agent 
for such credit union shall either—
‘‘(i) transfer to 1 financial institution, 
other than a financial institution for which 
a conservator, receiver, trustee in bank-
ruptcy, or other legal custodian has been 
appointed or which is otherwise the subject 
of a bankruptcy or insolvency proceeding—
‘‘(I) all qualified financial con-
tracts between any person or any af-