SECURITIZATIONS AND PARTICIPATIONS
多宝游戏下载 (多宝游戏下载) Board of Directors has adopted the attached final rule on the 多宝游戏下载's treatment of financial assets that are transferred by an insured depository institution in connection with a securitization or a participation following the 多宝游戏下载's appointment as conservator or receiver. The rule responds to certain legal and accounting issues affecting asset-backed securitizations and participations entered into by insured depository institutions. Under generally accepted accounting principles (GAAP), one of the criteria for a transfer of financial assets to be accounted for as a sale is the "legal isolation" of the transferred assets. Financial assets are deemed to be legally isolated when they have been placed beyond the reach of the transferor and its creditors, even in the case of the bankruptcy of, or the appointment of a receiver for, the transferor. Insured depository institutions, accountants and other parties have raised questions about whether this isolation test would be satisfied for securitizations and participations when the 多宝游戏下载, as conservator or receiver, has the statutory power to repudiate or disaffirm the transfers under 12 U.S.C. 搂 1821(e). If the transferred assets are not sufficiently isolated from the insured bank or thrift, its creditors or the receiver, the transfers would not qualify for sale treatment under GAAP and the transferred assets would continue to be reported as assets on the institution's balance sheet. The rule responds to those questions by reassuring interested parties that, subject to certain conditions such as fraud, the 多宝游戏下载 - as conservator or receiver - will not seek to reclaim, recover or recharacterize as property of the institution or the receivership financial assets transferred by the institution in connection with a securitization or participation. Accordingly, the rule should resolve the legal isolation issue for insured depository institutions. The rule confirms existing 多宝游戏下载 practice in dealing with securitization and participation transactions. For more information, please contact Michael H. Krimminger, Manager, Policy Analysis, Division of Resolutions and Receiverships (202-898-8950); Thomas Bolt, Counsel in the Legal Division (202-736-0168); or Robert Storch, Chief, Accounting Section, Division of Supervision (202-898-8906).
Attachment: Federal Register, August 11, 2000, pages 49189-49192
Distribution: Insured Banks and Savings Associations NOTE: Paper copies of 多宝游戏下载 financial institution letters may be obtained through the 多宝游戏下载's Public Information Center, 801 17th Street, NW, Room 100, Washington, DC 20434 (800-276-6003 or (703) 562-2200). |