Financial regulators continue to focus their attention on financial stability risks, particularly in the non-bank sector, suggesting Financial Stability Oversight Council (“FSOC”) powers could be deployed to address these risks.  Nonbank financial institutions (“NBFI”) and technology-related risks, particularly those related to artificial intelligence (“AI”), were key areas of focus in this month’s Congressional hearings with FSOC’s chair, Treasury Secretary Janet…

On February 6, 2024, the U.S. Securities and Exchange Commission (the “Commission”) adopted new rules 3a5-4 and 3a44-2 (collectively, the “Final Rules”), under the Securities Exchange Act of 1934 (the “Exchange Act”) further defining the phrase “as a part of a regular business” as used in the statutory definitions of “dealer”[1] and “government securities dealer”[2] set forth in Sections 3(a)(5)…

Acting Comptroller of the Currency Michael Hsu recently gave a speech previewing potential changes to the federal banking agencies’ liquidity regulations.  Specifically, he discussed recalibrating the outflow rates for uninsured deposits in the current liquidity coverage ratio (“LCR”) and introducing a new five-day stressed liquidity requirement.  In addition, and to complement potential changes to the regulatory framework, Hsu emphasized the…

As we approach the end of the year, here are the Top 10 posts on the Debevoise FinReg and FinTech Blog in 2023. If you are not already a Blog subscriber, click here to sign up. 1. Basel III Endgame Proposal Released Over Dissent (July 28, 2023) After several years of anticipation, the Federal Reserve Board (“FRB”), Federal Deposit Insurance Corporation…

Key Takeaways: In the final quarter of 2023, the Financial Stability Oversight Council (“FSOC”) issued its 2023 Annual Report, a new analytic framework for financial stability risks (the “Final Analytic Framework”) and final guidance on its nonbank financial company determinations process (the “Final Guidance”). The 2023 Annual Report, among other things, highlights areas of risk and stress FSOC believes should…

Over the past few months, U.S. federal banking regulators have issued a number of proposals aimed at enhancing capital and long-term debt requirements for both U.S. GSIBs and large regional banks. Banks have a range of financing options available to satisfy both existing and potential requirements. This Debevoise InDepth explores the myriad of options available to these banks and how…

In a Law360 article originally published November 16, 2023, Andrew J. Ceresney, Julie M. Riewe and Stephan J. Schlegelmilch discuss SEC v. Govil, a recent United States Court of Appeals for the Second Circuit opinion in which the court held that disgorgement is an equitable remedy and that the SEC cannot obtain disgorgement if they cannot identify a “victim” with…

On October 11, 2023, the Federal Deposit Insurance Corporation (the “FDIC”) published in the Federal Register for comment a notice of proposed rulemaking to establish new guidelines (the “Proposed Guidelines”) for governance and risk management at FDIC-supervised insured depository institutions (i.e., state non-member banks) with $10 billion or more in consolidated assets (“covered institutions”). The Proposed Guidelines would be issued as Appendix C…

On September 27, 2023, Senate Banking Committee members advanced the Secure and Fair Enforcement Regulation (SAFER) Banking Act (S. 2860) out of committee for a full Senate vote.  Prior versions of the bill have passed the House of Representatives repeatedly; however, the bill had never before been considered in the Senate. According to a joint statement by the sponsors of the…

On August 28, 2023, the SEC announced its first enforcement action against an NFT project, via a settled order as to Impact Theory, LLC (“Impact Theory”) for the offer and sale of unregistered securities.  However, absent from the order is any attempt to grapple with the unique issues presented by non-fungible tokens.  The SEC instead drafted an order that is…