[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4167 Introduced in House (IH)]

113th CONGRESS
  2d Session
                                H. R. 4167

 To amend section 13 of the Bank Holding Company Act of 1956, known as 
the Volcker Rule, to exclude certain debt securities of collateralized 
loan obligations from the prohibition against acquiring or retaining an 
       ownership interest in a hedge fund or private equity fund.


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                    IN THE HOUSE OF REPRESENTATIVES

                             March 6, 2014

   Mr. Barr introduced the following bill; which was referred to the 
                    Committee on Financial Services

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                                 A BILL


 
 To amend section 13 of the Bank Holding Company Act of 1956, known as 
the Volcker Rule, to exclude certain debt securities of collateralized 
loan obligations from the prohibition against acquiring or retaining an 
       ownership interest in a hedge fund or private equity fund.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Restoring Proven Financing for 
American Employers Act''.

SEC. 2. RULES OF CONSTRUCTION RELATING TO COLLATERALIZED LOAN 
              OBLIGATIONS.

    Section 13(g) of the Bank Holding Company Act of 1956 (12 U.S.C. 
1851(g)) is amended by adding at the end the following new paragraphs:
            ``(4) Collateralized loan obligations.--
                    ``(A) Inapplicability to certain collateralized 
                loan obligations.--Nothing in this section shall be 
                construed to require the divestiture of any debt 
                securities of collateralized loan obligations, if such 
                collateralized loan obligations were issued before 
                January 31, 2014.
                    ``(B) Ownership interest with respect to 
                collateralized loan obligations.--A banking entity 
                shall not be considered to have an ownership interest 
                in a collateralized loan obligation because it acquires 
                or retains a debt security in such collateralized loan 
                obligation if the debt security has no indicia of 
                ownership other than the right of the banking entity to 
                participate in the removal for cause, or in the 
                selection of a replacement after removal for cause or 
                resignation, of an investment manager or investment 
                adviser of the collateralized loan obligation.
                    ``(C) Definitions.--For purposes of this paragraph:
                            ``(i) Collateralized loan obligation.--The 
                        term `collateralized loan obligation' means any 
                        issuing entity of an asset-backed security, as 
                        defined in section 3(a)(77) of the Securities 
                        Exchange Act of 1934 (15 U.S.C. 78c(a)(77)), 
                        that is comprised primarily of commercial 
                        loans.
                            ``(ii) Removal for cause.--An investment 
                        manager or investment adviser shall be deemed 
                        to be removed `for cause' if the investment 
                        manager or investment adviser is removed as a 
                        result of--
                                    ``(I) a breach of a material term 
                                of the applicable management or 
                                advisory agreement or the agreement 
                                governing the collateralized loan 
                                obligation;
                                    ``(II) the inability of the 
                                investment manager or investment 
                                adviser to continue to perform its 
                                obligations under any such agreement; 
                                or
                                    ``(III) any other action or 
                                inaction by the investment manager or 
                                investment adviser that has or could 
                                reasonably be expected to have a 
                                materially adverse effect on the 
                                collateralized loan obligation, if the 
                                investment manager or investment 
                                adviser fails to cure or take 
                                reasonable steps to cure such effect 
                                within a reasonable time.''.
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