28 May OCC – Comment Request – Mandatory Contractual Stay Requirements for Qualified Financial Contracts
May 19, 2020 – The OCC is soliciting comment concerning the renewal of its information collection titled “Mandatory Contractual Stay Requirements for Qualified Financial Contracts.” Comments must be received by July 20, 2020.
Rule: A covered bank is required to ensure that a covered qualified financial contract (QFC) (1) contains a contractual stay-and-transfer provision analogous to the statutory stay-and-transfer provision imposed under Title II of the Dodd-Frank Act and in the Federal Deposit Insurance Act and (2) limits the exercise of default rights based on the insolvency of an affiliate of the covered bank.
Impact: The requirements are intended to enhance the resilience and the safety and soundness of Federally chartered and licensed financial institutions by addressing concerns relating to the exercise of default rights of certain financial contracts that could interfere with the orderly resolution of certain systemically important financial firms.
For more information, visit www.federalregister.gov