In Part 1 of Title 1 – Orderly Liquidation, we provided an overview of the Title I. In this article, we will discuss in detail the important provisions of this title. Mandatory terms and conditions for all orderly Liquidation actions In taking action under this title, the Corporation shall— determine that such action is necessary
Title II provides for the orderly liquidation of systemically important, failing financial companies. It subjects failing systemic financial companies (i.e., covered financial companies), including brokers and/or dealers and insurance companies, to orderly liquidation, subject to a systemic risk determination involving the FDIC, FRB, and Treasury (in consultation with the President). (The SEC and the Federal
Stress Tests Systemically Important Companies: The Federal Reserve must conduct annual stress tests for all systemically important companies under at least 3 scenarios – baseline, adverse and severely adverse. The Federal Reserve must require each systemically important company to modify its living will based on the results of the analysis. The Federal Reserve will also
Systemically Important Nonbank Financial Companies: A “nonbank financial company” is defined as any company, other than a bank holding company or a company that is treated as a bank holding company that is “predominantly engaged in financial activities.” To be “predominantly engaged in financial activities,” 85% or more of the company’s and its subsidiaries’ consolidated
In this article we understand in some detail the sub-titles of Title 1. The Council is authorized to make recommendations to the Federal Reserve concerning the establishment and refinement of prudential standards and reporting and disclosure requirements applicable to systemically important companies, to prevent or mitigate risk to U.S. financial stability that could arise from
To oversee financial stability f the system a Financial Stability Oversight Council was formed. This council will be chaired by the Secretary of Treasury. Its voting members include heads of Treasury, Federal Reserve, OCC, SEC, FDIC,FHFA, CFTC, NCUA and the Bureau of Consumer Financial Protection . It also includes a President nominated insurance expert, who
The Dodd-Frank Act is part of President Obama’s intent to re haul the financial institution framework in America. The Act aims at improving transparency and accountability in the American financial system. This act is an outcome of introspection and analysis post the biggest financial crisis in the United States of America since the Great Depression.
Markets in Financial Instruments Directive (MiFID) is an EU directive that will replace the existing Investment Services Directive (ISD), that is, Directive 93/22/EEC. It aims to create an integrated structure for a pan-European market for investment products. In particular it aims to make cross-border trading in securities in Europe easier for financial institutions and investors