July 31, 2017

FDIC is amending the recordkeeping requirements (12 CFR Part 371) for qualified financial contracts (QFCs). Under the regulation, insured depository institutions in a troubled condition are required to keep records related to the QFCs to which they are party. The effective date for the final rule is October 01, 2017.

The final rule augments the scope of QFC records required to be maintained by an insured depository institution that is subject to the FDIC’s recordkeeping requirements and that has total consolidated assets equal to or greater than USD 50 billion or is a consolidated affiliate of a member of a corporate group, one or more members of which are subject to the QFC recordkeeping requirements set forth in the regulations adopted by the Department of the Treasury. For all other insured depository institutions subject to the FDIC’s QFC recordkeeping requirements, it adds and deletes a limited number of data requirements and makes certain formatting changes with respect to the QFC recordkeeping requirements; requires full scope entities to keep QFC records of certain of their subsidiaries; provides an exemption process; and includes certain other changes, including changes that provide additional time for certain insured depository institutions in a troubled condition to comply with the regulations.

 

The changes to both the formatting and the quantity of information will enable the FDIC, as the receiver, to make better informed and efficient decisions on whether to transfer some or all of a failed insured depository institution’s QFCs during the one business-day stay period for the transfer of QFCs. This will help the FDIC achieve a least costly resolution. Overall, the final rule:

 

Enhances and updates recordkeeping requirements as to QFCs of insured depository institutions in troubled condition to facilitate the orderly resolution of insured depository institutions with QFC portfolios

Revises the format of records required to be maintained to provide more ready access to expanded QFC portfolio data

Requires that more comprehensive information be maintained to facilitate the FDIC’s understanding of complex QFC portfolios of insured depository institutions in receivership


Related Link: Federal Register Notice (PDF)  

Effective Date: October 01, 2017

Keywords: Americas, United States of America, Banking, Qualified Financial Contracts, Record Keeping Resolution, FDIC

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