The Board of Governors of the Federal Reserve System released today a Final Rule Establishing Restrictions on Qualified Financial Contracts of Systemically Important U.S. Banking Organizations and the U.S. Operations of Systemically Important Foreign Banking Organizations (“QFC Rule”). Links to the QFC Rule and related materials are provided below.
The QFC Rule imposes limitations on the default rights of counterparties that may be included in swaps, repos and certain other financial contracts entered into with systemically important financial institutions subject to the rule (“Covered Entities”). The exercise of such rights in the context of the failure or resolution of a Covered Entity is limited in certain circumstances in order to facilitate the orderly resolution of the Covered Entity. Click here for more..
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