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Commentary by Scott Cammarn

On June 5, 2013, the Board of Governors of the Federal Reserve System issued an Interim Rule under Section 716 of the Dodd-Frank Act (commonly known as the "Lincoln Amendment"). The Lincoln Amendment generally restricts certain swaps dealing activities by banking institutions that have access to Federal Reserve advances or that are FDIC-insured, albeit with some limited exceptions that were generally available only to "insured depository institutions", which phrase arguably did not encompass many U.S. branches of non-U.S. banks. The Interim Rule deems uninsured U.S. branches of foreign banks

Commentary by Scott Cammarn

The Office of the Comptroller of the Currency ("OCC") issued identical letters to seven national banks approving their requests for a 24-month transition period under Section 716 of the Dodd-Frank Act (commonly known as the "Lincoln Amendment"). The letters, which track the statutory language of Section 716, allow the banks additional time under the transition period to cease or divest their swaps activities after the effective date of the Lincoln Amendment on July 16, 2013. Letters: Bank of America; Citibank; Wells Fargo; HSBC; JPMC; Morgan Stanley; U.S. Bank. Related News Items : FRB

SIFMA submitted a comment letter to Speaker Boehner (R-OH) and Congresswoman Pelosi (D-CA) expressing strong support for H.R. 992 . The House Bill relates to Dodd-Frank Section 716 ("Prohibition against Federal Government Bailouts of Swaps Entities") (also known as "Lincoln" or "push out"), which requires commercial banks to push out or remove certain swaps activities from the bank and establish and capitalize a separate affiliate. As a result of this section, SIFMA's position is that financial institutions could no longer be eligible for netting and other efficiencies, and SIFMA clients will

The Board of Governors of the Federal Reserve System ("FRB") approved a final rule titled Prohibition Against Federal Assistance to Swaps Entities ("Regulation KK"), which clarifies the treatment of uninsured U.S. branches and agencies of foreign banks under Dodd-Frank Section 716, commonly known as "Lincoln", or as the swaps push-out provision. The final rule adopts without change the interim final rule issued by the Board on June 5, 2013. Section 716 of Dodd-Frank generally prohibits the provision of certain types of federal assistance, such as discount window lending and deposit insurance

The U.S. Congress is scheduled to consider a proposal to allow banks to keep swaps trading units. The congressional vote on the proposal, which is included in the government funding bill ( H.R. 83) , will take place soon. Regarding the bill, FDIC Vice Chair Hoenig stated that "[i]t is illogical to repeal the 716 push out requirement," and explained that most derivatives would not even be pushed out of the bank because "interest rate swaps, foreign exchange and cleared credit derivatives can remain within the bank." According to Vice Chair Hoenig, the main items that must be pushed out under