Preserving Access to CRE Capital Act of 2016

Bill: 114-hr-4620
Sponsor: full_name: Rep. Hill, J. French [R-AR-2]
Introduced: 2016-02-25
Policy area: Finance and Financial Sector
Subjects: Administrative law and regulatory procedures

Credit and credit markets

Department of the Treasury

Federal Deposit Insurance Corporation (FDIC)

Federal Reserve System

Real estate business

Securities

Securities and Exchange Commission (SEC)
Latest action: action_date: 2016-05-26
text: Placed on the Union Calendar, Calendar No. 463.

Summaries:
action_date: 2016-02-25
action_desc: Introduced in House
text: <p><b>Preserving Access to CRE Capital Act of 2016 </b></p> <p>This bill amends the Securities Exchange Act of 1934 concerning credit risk retention standards for commercial real estate loans to revise the optional standard that may include retention of the first-loss position by a third-party purchaser that specifically negotiates for the purchase of that first loss position, holds adequate financial resources to back losses, provides due diligence on all individual assets in the pool before issuance of the asset-backed securities, and meets the same standards for risk retention as the federal banking agencies and the Securities and Exchange Commission (SEC) require of the securitizer.</p> <p>The revised specifications for retention of the first-loss position by a third-party purchaser shall mean the permissible risk retention of the first-loss position by a one or two party third-party purchaser, who may hold the retention obligation in either a senior-subordinate structure or <i>pari passu</i> (where two or more assets, securities, creditors or obligations are equally managed without any display of preference), as long as each party meets the requirements expressed above.</p> <p>The bill exempts from risk retention requirements the securitization of a single commercial real estate loan or a group of cross-collateralized or cross-defaulted commercial real estate loans that represent the obligation of one or more related borrowers secured by commercial properties under direct or indirect common ownership or control.</p> <p>The SEC and the federal banking agencies shall jointly maintain specified regulations which exempt qualified commercial real estate loans from risk retention requirements.</p>

action_date: 2016-05-26
action_desc: Reported to House without amendment
text: <p>(This measure has not been amended since it was introduced. The summary has been expanded because action occurred on the measure.)</p> <p><b>Preserving Access to CRE Capital Act of 2016 </b></p> <p>(Sec. 2) This bill amends the Securities Exchange Act of 1934 concerning credit risk retention standards for commercial real estate loans to revise the optional standard that may include retention of the first-loss position by a third-party purchaser that specifically negotiates for the purchase of that first loss position, holds adequate financial resources to back losses, provides due diligence on all individual assets in the pool before issuance of the asset-backed securities, and meets the same standards for risk retention as the federal banking agencies and the Securities and Exchange Commission (SEC) require of the securitizer.</p> <p>The revised specifications for retention of the first-loss position by a third-party purchaser shall mean the permissible risk retention of the first-loss position by a one or two party third-party purchaser, who may hold the retention obligation in either a senior-subordinate structure or <i>pari passu</i> (where two or more assets, securities, creditors or obligations are equally managed without any display of preference), as long as each party meets the requirements expressed above.</p> <p>The bill exempts from risk retention requirements the securitization of a single commercial real estate loan or a group of cross-collateralized or cross-defaulted commercial real estate loans that represent the obligation of one or more related borrowers secured by commercial properties under direct or indirect common ownership or control.</p> <p>The SEC and the federal banking agencies shall jointly maintain specified regulations which exempt qualified commercial real estate loans from risk retention requirements.</p>

tv_txt: I 114th CONGRESS 2d Session H. R. 4620 IN THE HOUSE OF REPRESENTATIVES February 25, 2016 Mr. Hill introduced the following bill; which was referred to the Committee on Financial Services A BILL To amend the Securities Exchange Act of 1934 to exempt certain commercial real estate loans from risk retention requirements, and for other purposes.

1. Short title This Act may be cited as the Preserving Access to CRE Capital Act of 2016 . 2. Exemption for certain commercial real estate loans from risk retention requirements Section 15G of the Securities Exchange Act of 1934 ( 15 U.S.C. 78o–11 ) is amended— (1) in subsection (c)(1)(E)(ii), by striking retention of the first-loss position by a third-party purchaser that and inserting retention of the first-loss position by a one or two party third-party purchaser, who may hold the retention obligation in either a senior-subordinate structure or pari passu, provided that each ; and (2) in subsection (e)— (A) by redesignating paragraph (6) as paragraph (7); and (B) by inserting after paragraph (5) the following new paragraph: (6) Exemption for certain commercial real estate loans (A) Exemption for single loan commercial real estate securitization A securitization of a single commercial real estate loan or a group of cross-collateralized or cross-defaulted commercial real estate loans that represent the obligation of one or more related borrowers secured by one or more commercial properties under direct or indirect common ownership or control is exempt from the risk retention requirements of this section. (B) Exemption for qualified commercial real estate loans (i) Regulations required The Federal banking agencies and the Commission shall jointly maintain regulations to exempt qualified commercial real estate loans from the risk retention requirements of this section. (ii) Standards for regulations The regulations issued under clause (i) shall— (I) include the requirements under which interest-only loans may be exempt from the risk retention requirements of this section; (II) not impose any term requirements on the length of a qualified commercial real estate loan; (III) if an amortization requirement is included, not impose an amortization schedule of less than 30 years; and (IV) not impose separate loan-to-value ratio caps on qualified commercial real estate loans that are documented with appraisals that utilize lower capitalization rates than other loans. .

tv_txt: IB Union Calendar No. 463 114th CONGRESS 2d Session H. R. 4620 [Report No. 114–597] IN THE HOUSE OF REPRESENTATIVES February 25, 2016 Mr. Hill introduced the following bill; which was referred to the Committee on Financial Services May 26, 2016 Additional sponsors: Mr. Messer , Mr. Carney , Mr. Neugebauer , Mr. Huizenga of Michigan , Mrs. Wagner , Mr. Stivers , and Mr. Barr May 26, 2016 Committed to the Committee of the Whole House on the State of the Union and ordered to be printed A BILL To amend the Securities Exchange Act of 1934 to exempt certain commercial real estate loans from risk retention requirements, and for other purposes.

1. Short title This Act may be cited as the Preserving Access to CRE Capital Act of 2016 . 2. Exemption for certain commercial real estate loans from risk retention requirements Section 15G of the Securities Exchange Act of 1934 ( 15 U.S.C. 78o–11 ) is amended— (1) in subsection (c)(1)(E)(ii), by striking retention of the first-loss position by a third-party purchaser that and inserting retention of the first-loss position by a one or two party third-party purchaser, who may hold the retention obligation in either a senior-subordinate structure or pari passu, provided that each ; and (2) in subsection (e)— (A) by redesignating paragraph (6) as paragraph (7); and (B) by inserting after paragraph (5) the following new paragraph: (6) Exemption for certain commercial real estate loans (A) Exemption for single loan commercial real estate securitization A securitization of a single commercial real estate loan or a group of cross-collateralized or cross-defaulted commercial real estate loans that represent the obligation of one or more related borrowers secured by one or more commercial properties under direct or indirect common ownership or control is exempt from the risk retention requirements of this section. (B) Exemption for qualified commercial real estate loans (i) Regulations required The Federal banking agencies and the Commission shall jointly maintain regulations to exempt qualified commercial real estate loans from the risk retention requirements of this section. (ii) Standards for regulations The regulations issued under clause (i) shall— (I) include the requirements under which interest-only loans may be exempt from the risk retention requirements of this section; (II) not impose any term requirements on the length of a qualified commercial real estate loan; (III) if an amortization requirement is included, not impose an amortization schedule of less than 30 years; and (IV) not impose separate loan-to-value ratio caps on qualified commercial real estate loans that are documented with appraisals that utilize lower capitalization rates than other loans. .

May 26, 2016 Committed to the Committee of the Whole House on the State of the Union and ordered to be printed