Restoring Proven Financing for American Employers Act

Bill: 113-hr-4167
Sponsor: full_name: Rep. Barr, Andy [R-KY-6]
Introduced: 2014-03-06
Policy area: Finance and Financial Sector
Subjects: Bank accounts, deposits, capital

Banking and financial institutions regulation

Corporate finance and management

Credit and credit markets

Financial services and investments

Securities
Latest action: action_date: 2014-04-30
text: Received in the Senate and Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.

Summaries:
action_date: 2014-03-06
action_desc: Introduced in House
text: <p>Restoring Proven Financing for American Employers Act - Amends the Bank Holding Company Act of 1956 with respect to certain prohibitions on proprietary trading by banking entities and certain relationships with hedge funds and private equity funds (Volcker Rule).</p> <p>Prohibits the Volcker Rule from being construed to require divestiture of any debt securities of collateralized loan obligations issued before January 31, 2014.</p> <p>Declares that a banking entity shall not be considered to have an ownership interest in a collateralized loan obligation because it acquires or retains a debt security in it if the debt security has no indicia of ownership other than the right of the banking entity to participate in the removal for cause, or in the selection of a replacement after removal for cause or resignation, of an investment manager or investment adviser of the collateralized loan obligation.</p> <p>Defines &quot;collateralized loan obligation&quot; as any issuing entity of an asset-backed security comprised primarily of commercial loans.</p>

action_date: 2014-04-29
action_desc: Passed House amended
text: <p>Restoring Proven Financing for American Employers Act - Amends the Bank Holding Company Act of 1956 with respect to certain prohibitions on proprietary trading by banking entities and certain relationships with hedge funds and private equity funds (Volcker Rule).</p> <p>Prescribes rules of construction governing a collateralized loan obligation to prohibit the Volcker Rule from being construed to require divestiture, before July 21, 2017, of any debt securities of collateralized loan obligations issued before January 31, 2014.</p> <p>Declares that a banking entity shall not be considered to have an ownership interest in a collateralized loan obligation because it either acquires, has acquired, or retains a debt security in such obligation if the debt security has no indicia of ownership other than the right of the banking entity to participate in the removal for cause, or in the selection of a replacement after removal for cause or resignation, of an investment manager or investment adviser of the collateralized loan obligation.</p> <p>Defines &quot;collateralized loan obligation&quot; as any issuing entity of an asset-backed security comprised primarily of commercial loans.</p> <p>Deems an investment manager or adviser to be removed &quot;for cause&quot; if the removal is a result of:</p> <ul> <li> a breach of a material term of the applicable management or advisory agreement or the agreement governing the collateralized loan obligation;</li> <li>the investment manager's or investment adviser's inability to continue to perform its obligations under any such agreement;</li> <li>any other action or inaction by the investment manager or investment adviser that has or could reasonably be expected to have a materially adverse effect on the collateralized loan obligation, if the investment manager or investment adviser fails to cure or take reasonable steps to cure such effect within a reasonable time; or </li> <li>an event or circumstance which threatens, or could reasonably be expected to threaten, the interests of holders of the debt securities.</li> </ul>

tv_txt: I 113th CONGRESS 2d Session H. R. 4167 IN THE HOUSE OF REPRESENTATIVES March 6, 2014 Mr. Barr introduced the following bill; which was referred to the Committee on Financial Services A BILL To amend section 13 of the Bank Holding Company Act of 1956, known as the Volcker Rule, to exclude certain debt securities of collateralized loan obligations from the prohibition against acquiring or retaining an ownership interest in a hedge fund or private equity fund.

1. Short title This Act may be cited as the Restoring Proven Financing for American Employers Act . 2. Rules of construction relating to collateralized loan obligations Section 13(g) of the Bank Holding Company Act of 1956 ( 12 U.S.C. 1851(g) ) is amended by adding at the end the following new paragraphs: (4) Collateralized loan obligations (A) Inapplicability to certain collateralized loan obligations Nothing in this section shall be construed to require the divestiture of any debt securities of collateralized loan obligations, if such collateralized loan obligations were issued before January 31, 2014. (B) Ownership interest with respect to collateralized loan obligations A banking entity shall not be considered to have an ownership interest in a collateralized loan obligation because it acquires or retains a debt security in such collateralized loan obligation if the debt security has no indicia of ownership other than the right of the banking entity to participate in the removal for cause, or in the selection of a replacement after removal for cause or resignation, of an investment manager or investment adviser of the collateralized loan obligation. (C) Definitions For purposes of this paragraph: (i) Collateralized loan obligation The term collateralized loan obligation means any issuing entity of an asset-backed security, as defined in section 3(a)(77) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78c(a)(77) ), that is comprised primarily of commercial loans. (ii) Removal for cause An investment manager or investment adviser shall be deemed to be removed for cause if the investment manager or investment adviser is removed as a result of— (I) a breach of a material term of the applicable management or advisory agreement or the agreement governing the collateralized loan obligation; (II) the inability of the investment manager or investment adviser to continue to perform its obligations under any such agreement; or (III) any other action or inaction by the investment manager or investment adviser that has or could reasonably be expected to have a materially adverse effect on the collateralized loan obligation, if the investment manager or investment adviser fails to cure or take reasonable steps to cure such effect within a reasonable time. .

tv_txt: I 113th CONGRESS 2d Session H. R. 4167 IN THE HOUSE OF REPRESENTATIVES AN ACT To amend section 13 of the Bank Holding Company Act of 1956, known as the Volcker Rule, to exclude certain debt securities of collateralized loan obligations from the prohibition against acquiring or retaining an ownership interest in a hedge fund or private equity fund.

1. Short title This Act may be cited as the Restoring Proven Financing for American Employers Act . 2. Rules of construction relating to collateralized loan obligations Section 13(g) of the Bank Holding Company Act of 1956 ( 12 U.S.C. 1851(g) ) is amended by adding at the end the following new paragraphs: (4) Collateralized loan obligations (A) Inapplicability to certain collateralized loan obligations Nothing in this section shall be construed to require the divestiture, prior to July 21, 2017, of any debt securities of collateralized loan obligations, if such debt securities were issued before January 31, 2014. (B) Ownership interest with respect to collateralized loan obligations A banking entity shall not be considered to have an ownership interest in a collateralized loan obligation because it acquires, has acquired, or retains a debt security in such collateralized loan obligation if the debt security has no indicia of ownership other than the right of the banking entity to participate in the removal for cause, or in the selection of a replacement after removal for cause or resignation, of an investment manager or investment adviser of the collateralized loan obligation. (C) Definitions For purposes of this paragraph: (i) Collateralized loan obligation The term collateralized loan obligation means any issuing entity of an asset-backed security, as defined in section 3(a)(77) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78c(a)(77) ), that is comprised primarily of commercial loans. (ii) Removal for cause An investment manager or investment adviser shall be deemed to be removed for cause if the investment manager or investment adviser is removed as a result of— (I) a breach of a material term of the applicable management or advisory agreement or the agreement governing the collateralized loan obligation; (II) the inability of the investment manager or investment adviser to continue to perform its obligations under any such agreement; (III) any other action or inaction by the investment manager or investment adviser that has or could reasonably be expected to have a materially adverse effect on the collateralized loan obligation, if the investment manager or investment adviser fails to cure or take reasonable steps to cure such effect within a reasonable time; or (IV) a comparable event or circumstance that threatens, or could reasonably be expected to threaten, the interests of holders of the debt securities. .

Passed the House of Representatives April 29, 2014. Karen L. Haas, Clerk.

tv_txt: II 113th CONGRESS 2d Session H. R. 4167 IN THE SENATE OF THE UNITED STATES April 30, 2014 Received; read twice and referred to the Committee on Banking, Housing, and Urban Affairs AN ACT To amend section 13 of the Bank Holding Company Act of 1956, known as the Volcker Rule, to exclude certain debt securities of collateralized loan obligations from the prohibition against acquiring or retaining an ownership interest in a hedge fund or private equity fund.

1. Short title This Act may be cited as the Restoring Proven Financing for American Employers Act . 2. Rules of construction relating to collateralized loan obligations Section 13(g) of the Bank Holding Company Act of 1956 ( 12 U.S.C. 1851(g) ) is amended by adding at the end the following new paragraphs: (4) Collateralized loan obligations (A) Inapplicability to certain collateralized loan obligations Nothing in this section shall be construed to require the divestiture, prior to July 21, 2017, of any debt securities of collateralized loan obligations, if such debt securities were issued before January 31, 2014. (B) Ownership interest with respect to collateralized loan obligations A banking entity shall not be considered to have an ownership interest in a collateralized loan obligation because it acquires, has acquired, or retains a debt security in such collateralized loan obligation if the debt security has no indicia of ownership other than the right of the banking entity to participate in the removal for cause, or in the selection of a replacement after removal for cause or resignation, of an investment manager or investment adviser of the collateralized loan obligation. (C) Definitions For purposes of this paragraph: (i) Collateralized loan obligation The term collateralized loan obligation means any issuing entity of an asset-backed security, as defined in section 3(a)(77) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78c(a)(77) ), that is comprised primarily of commercial loans. (ii) Removal for cause An investment manager or investment adviser shall be deemed to be removed for cause if the investment manager or investment adviser is removed as a result of— (I) a breach of a material term of the applicable management or advisory agreement or the agreement governing the collateralized loan obligation; (II) the inability of the investment manager or investment adviser to continue to perform its obligations under any such agreement; (III) any other action or inaction by the investment manager or investment adviser that has or could reasonably be expected to have a materially adverse effect on the collateralized loan obligation, if the investment manager or investment adviser fails to cure or take reasonable steps to cure such effect within a reasonable time; or (IV) a comparable event or circumstance that threatens, or could reasonably be expected to threaten, the interests of holders of the debt securities. .

Passed the House of Representatives April 29, 2014. Karen L. Haas, Clerk