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Syndicated Loan Market Advocacy & Regulatory

The LSTA advocates on behalf of the loan market, and focuses on critical matters (regulations under Dodd-Frank, Leveraged Lending Guidance, FATCA and Bankruptcy reform) that could dramatically affect the loan market and the broader economy.

Displaying 1-37 of 37 results.
DateTitle/DescriptionFiles
Oct 17, 2018

Comment Letter on Proposed Changes to the Volcker Rule

The LSTA submitted a comment letter on proposed changes to the Volcker Rule. Importantly for the loan and CLO markets, the proposal puts into play the issue of whether banks can own the debt securities of CLOs that hold bonds.  The LSTA’s comment letter focuses on two points.  First, it suggests that the final rule’s “loan securitization” exclusion be modified to include even traditional CLOs that have modest baskets for bonds or assets other than loans.  Including traditional CLOs in the definition of loan securitizations would be consistent with the congressional intent as reflected in the Volcker Rule’s “rule of construction” regarding loan securitizations since CLOs that existed at the time of the passage of Dodd-Frank did include bond baskets.  Second, it argues that the final rule’s definition of “ownership interest” that provides that the “rights of a creditor to exercise remedies upon the occurrence of an event of default…” include the right to participate in the removal of an investment manager “for cause” or participate in the replacement of a manger in such circumstances.

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Aug 9, 2018

Comment Letter on SEC Fiduciary Standard Proposal

The Securities and Exchange Commission earlier this year issued a two-part release that could impact investment managers - including loan managers.  The second part of the release requests comments regarding proposed enhanced investment adviser regulation.  The LSTA this week submitted a comment letter on the two proposals, broadly supporting the recommendations of the Investment Advisers Association (“IAA”).  The LSTA added a recommendation regarding Form CRS that would be relevant to some registered advisers that manage loans.  The IAA letters are available here and here.

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Oct 30, 2017

Comment Letter on “Request for Information Pertaining to Production of Rates”

In response to the “Request for Information Relating to the Production of Rates”, the LSTA submitted a letter to the Federal Reserve discussing the impact of a transition from LIBOR to SOFR (or another reference rate) on the U.S. syndicated loan market. The letter discusses key stakeholders in the syndicated loan market and why they care about the transition from LIBOR to a new reference rate. In addition, the letter addressed Question 3 “Are there any changes to one or more of these rates that would make them more useful? For what purposes?” 

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Apr 7, 2017

Risk Retention Letter to Treasury

In response to a recent Executive Order from president Trump outlining “Core Principles” for financial regulation and seeking suggestions for streamlining financial regulation, the LSTA submitted a letter to Treasury Secretary Mnuchin.  The letter outlines why the application of the Dodd-Frank risk retention provides no benefits but causes substantial harm to borrowers, investors, managers and, ultimately consumers, by restricting the flow of capital to American companies.  The LSTA identifies three avenues to reform and proposes that the SEC, as the agency that regulates the vast majority of managers, has the ability to exercise its authority to waive the risk retention rules for CLO managers.

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Aug 18, 2016

LSTA Incentive Compensation Letter

On Thursday August 18, 2016, the Loan Syndications and Trading Association (LSTA) submitted a comment letter to the OCC, Federal Reserve, FDIC, FHFA, NCUA and SEC in response to their notice of proposed rulemaking on Incentive-Based Compensation Arrangements.

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Jul 20, 2016

2016 LSTA STS Securitization Comment Letter

On Tuesday, July 20, 2016, the Loan Syndications and Trading Association (LSTA) submitted a comment letter to European Parliament’s ECON Rapporteur Paul Tang in response to proposed amendments to “Simple, Transparent and Standardised (STS)” Securitizations.

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Jan 13, 2016

LSTA Open End Mutual Fund Liquidity Risk Comment Letter

On Wednesday, January 13, 2016, the Loan Syndications and Trading Association (LSTA) submitted a comment letter to the SEC in response to the proposed rule on Open-End Fund Liquidity Risk Management Programs.

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Jan 14, 2015

LSTA Comment Letter Explains Why CLOs Are High Quality Securitizations

The LSTA submitted a comment letter to the EBA arguing that CLOs performed well in the crisis, that they have none of the characteristics identified as likely to create difficulties during periods of turmoil, and explaining that Qualified CLOs align with the principles of simple, standard and transparent securitizations.

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Aug 27, 2014

LSTA Comment Letter Answers Three Questions on the Qualified CLO Proposal

In response to questions from the agencies, the LSTA submitted a comment letter that answered questions on whether companies issuing institutional loans are audited by PCAOB-registered accountants, whether all investors in CLOs are QIBs, and whether the SEC has access to CLO trustee reports. 

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Jun 25, 2014

LSTA Files Comment Letter to U.S. Regulators Highlighting the Bank of England and European Central Bank “Qualifying Securitisation” Proposal

LSTA submitted a letter to the U.S. Risk Retention regulators highlighting the similarity in the principles of the U.S. industry’s “Qualified CLO” proposal and the Bank of England and European Central Bank’s “Qualifying Securitisation” proposal.

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Mar 24, 2014

LSTA Letter Requesting Changes to the Definition of Limited Life Debt Investment Entity

LSTA submitted a letter to the IRS and Treasury requesting changes to the definition of “limited life debt investment entity” in the temporary regulations implementing FATCA issued by the IRS in February 2014.

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Jan 10, 2014

LSTA Files Comment Letter on Dodd Frank's Risk Retention Requirement

The LSTA, SIFMA and SFIG proposes the “Qualified CLO”, whereby a CLO that meets six strict criteria can meet the risk retention requirement by retaining 5% of equity, not 5% of the notional amount of a new CLO.

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Jan 10, 2014

LSTA Files Third Comment Letter on Final Volcker Rule

The LSTA filed a third comment letter on the Final Volcker Rule clarifying certain aspects of the December 24th and December 31st letters.

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Dec 31, 2013

LSTA Files Second Comment Letter on Final Volcker Rule

The LSTA filed a second letter to the regulatory agencies again requesting confirmation that the term “ownership interest” in the Final Volcker Rule does not include debt securities of CLOs and asking for expedited relief.

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Dec 24, 2013

LSTA Seeks Clarification of “Ownership Interest” Under Volcker

The LSTA submitted a letter to the regulatory agencies seeking clarification that “ownership interest” in the Final Volcker Rule does not include debt securities of CLOs.

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Nov 18, 2013

LSTA Releases Oliver Wyman Study That Urges Caution on Regulations on Collateralized Loan Obligations

Oliver Wyman Study on Risk Retention and CLOs: This study estimates the probable impact of risk retention on CLOs, and the subsequent reduction in availability of credit and increased cost of credit for non-Investment grade U.S. borrowers.

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Oct 30, 2013

LSTA Submits Risk Retention Re-Proposal Comment Letter

The LSTA responds to the Agencies’ Risk Retention Reproposal, dated August 28, 2013.

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Sep 6, 2013

LSTA Submits Letter to IRS and Treasury on FATCA Compliance by CLOs

LSTA submitted a letter to the IRS and Treasury supporting the letter submitted by ISDA on August 28, 2013 as it pertains to FATCA’s reporting requirements for CLOs.

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Jul 29, 2013

LSTA Submits Comment Letter to Joint Regulators

The LSTA provides the Agencies the results of a survey of CLO managers that determined their ability and willingness to retain risk.

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Apr 17, 2013

LSTA/SIFMA Joint Letter Re Proposed Definition of “Limited Life Debt Investment Entity” in FATCA

LSTA and SIFMA jointly submitted a letter to the IRS and Treasury requesting technical corrections to their definition of “Limited Life Debt Investment Entity” in the FATCA proposal.

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Aug 21, 2012

Joint Additional Comment Letter

At the request of the banking agencies, the LSTA and ABA submit an additional comment letter explaining why fallen angels should not be included in the leveraged lending guidance.

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Jun 8, 2012

Joint Comment Letter on Leveraged Lending Guidance

The LSTA and ABA submit comment letter on leveraged lending guidance.

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Apr 30, 2012

LSTA Issues Fourth Comment Letter on FATCA

The LSTA submitted its fourth comment letter in response of the IRS’s proposed regulations implementing FATCA released on February 8, 2012.

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Apr 9, 2012

CLO Regulatory Text Submission

The LSTA submits final proposed regulatory text exempting from risk retention an Open Market CLO that meets a number of criteria.

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Feb 13, 2012

Submits Comment Letter on Volcker Rule Proposal

The LSTA filed a comment letter on the proposed regulations implementing the Volcker Rule urging the regulatory agencies to exclude CLOs from the Volcker Rule.

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Feb 10, 2012

LSTA Submits Comment Letter to the SEC on Conflicts of Interests in Securitizations

LSTA submitted a comment letter to the SEC on “Conflicts of Interests in Securitizations.

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Oct 4, 2011

LSTA Submits Comment Letter on Regulation AB to SEC

In response to the SEC’s Re-Proposal of Shelf Eligibility Requirements for Asset-Backed Securities, the LSTA submitted a comment letter recommending that any SEC-mandated disclosure requirements for CLOs reflect the unique characteristics of syndicated loans and CLOs.

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Sep 1, 2011

LSTA Submits Final Proposed Regulatory Text

The LSTA submits final proposed regulatory text exempting from risk retention an Open Market CLO that meets a number of criteria.

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Aug 1, 2011

LSTA Submits Comment Letter on Risk Retention Requirements to Joint Regulators

The LSTA responds to the Agencies’ initial Risk Retention Proposal, dated April 29, 2011.

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Jul 22, 2011

LSTA Submits Comment Letter on Title VII Product Definitions

LSTA submitted a comment letter to the SEC and CFTC (the “Commissions”) that focuses on two issues raised by Title VII of Dodd Frank.

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Jun 7, 2011

Third LSTA Comment Letter on FATCA

LSTA submitted a third comment letter to the IRS and Treasury in response to Notice 2011-34 and a meeting with IRS staff members.

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Jan 25, 2011

LSTA Submits Joint Comment Letter on Loan Participation

LSTA submitted to the Commodity Futures Trading Commission (“CFTC”) and the Securities and Exchange Commission (“SEC) a comment letter to highlight the importance of loan participations in the U.S. and global markets for syndicated loans.

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Dec 23, 2010

LSTA Submits Comment Letter on Loan Derivatives Rule Proposal

LSTA submitted a comment letter to the SEC raising its concerns about the SEC’s Proposed Rule 9j-1 released on November 3rd under the Securities Exchange Act (the “Exchange Act”).

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Nov 1, 2010

LSTA Comment Letter on FATCA

LSTA submitted a second comment letter to the IRS on FATCA, focusing on the implications for the CLO market.

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Aug 3, 2010

LSTA Issues White Paper on Syndicated Loans and CLOs

LSTA issued a White Paper that discussed the importance of syndicated loans and CLOs to U.S. companies.

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Jul 30, 2010

LSTA issues Comment Letter on SEC’s Regulation AB

The LSTA issued a comment letter on the SEC's proposed changes to Regulation AB.

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Jul 15, 2010

Original LSTA Comment Letter on FATCA

LSTA submitted its initial comments to the IRS and U.S. Department of the Treasury on the implications for the proposed FATCA rules on the U.S. corporate loan market.

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