Bank Affiliate Transactions: Navigating Regulation W, Sections 23A and 23B of the Federal Reserve Act

Recording of a 90-minute CLE webinar with Q&A


Conducted on Tuesday, May 16, 2017

Recorded event now available

Program Materials

This CLE webinar will provide bank counsel with an analysis of Regulation W, which governs transactions that banks may conduct with affiliates and insiders, and best practices for compliance. The panel will also discuss the impact of Dodd-Frank mandates, including Sections 608 and 619, on the affiliate transaction rules, and the anticipated regulatory and enforcement framework under the new administration. Practical problems and solutions will be discussed.

Description

Sections 23A and 23B of the Federal Reserve Act (as implemented by Federal Reserve Regulation W) restrict certain transactions between banks and their non-bank affiliates. Regulation W predates Dodd-Frank and is expected to remain under any deregulation efforts under the current administration.

The analysis of each affiliate transaction is critical in determining when Regulation W applies. Counsel needs to determine whether a given transaction is with a bank affiliate, and whether it is a covered transaction under Reg W. There are both a qualitative and quantitative aspects to the analysis.

In the wake of the Great Recession several provisions in Dodd-Frank tightened the restrictions on affiliate transactions, particularly with respect to derivatives transactions. The scope of “affiliates” and transactions subject to Section 23A have been expanded and collateral requirements for extensions of credit increased. Counsel must also now consider the Volker Rule in evaluating relationships and transactions.

Listen as our authoritative panel of banking attorneys guides you through the complex affiliate transaction rules, including various covered transactions and exemptions. The panel will also discuss best practices for compliance in the current regulatory and enforcement climate.

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Outline

  1. Regulation W Rule 23A
    1. What constitutes an “affiliate”
    2. Covered transactions—the seven categories
    3. Quantitative limitations
    4. Collateral requirements
    5. Exemptions
  2. Regulation W Rule 23B
    1. Market terms for affiliate transactions
    2. Attribution rule
  3. Dodd-Frank Amendments
    1. Investment funds
    2. Derivative transactions
    3. Securities lending

Benefits

The panel will review these and other key issues:

  • What are the qualitative and quantitative limits and collateral requirements of Section 23A for covered transactions?
  • How does Section 23B ensure that transactions between banks and their affiliates occur on market terms?
  • What are the additional restrictions under Regulation W mandated under Dodd-Frank?
  • How will the current movement toward financial de-regulation impact Regulation W?
  • Practical examples and solutions.

Faculty

Ralph F. (Chip) MacDonald, III
Ralph F. (Chip) MacDonald, III

Partner
Jones Day

Mr. MacDonald's practice emphasizes securities, mergers and acquisitions, corporate governance, financial...  |  Read More

Carlton E. Langer
Carlton E. Langer
Senior Vice President and Deputy General Counsel
Huntington National Bank

Mr. Langer has over 37 years of experience in banking.  He spent the first 30 years of his banking career at...  |  Read More

Susan Boltacz
Susan Boltacz
Senior Vice President
SunTrust Bank

Ms. Boltacz is the Regulation W Officer and a Senior Vice President at SunTrust Bank, where she has worked for...  |  Read More