Bill summaries are authored by CRS.

Shown Here:
Passed House amended (04/29/2014)

Restoring Proven Financing for American Employers Act - Amends the Bank Holding Company Act of 1956 with respect to certain prohibitions on proprietary trading by banking entities and certain relationships with hedge funds and private equity funds (Volcker Rule).

Prescribes rules of construction governing a collateralized loan obligation to prohibit the Volcker Rule from being construed to require divestiture, before July 21, 2017, of any debt securities of collateralized loan obligations issued before January 31, 2014.

Declares that a banking entity shall not be considered to have an ownership interest in a collateralized loan obligation because it either acquires, has acquired, or retains a debt security in such 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.

Defines "collateralized loan obligation" as any issuing entity of an asset-backed security comprised primarily of commercial loans.

Deems an investment manager or adviser to be removed "for cause" if the removal is a result of:

  • a breach of a material term of the applicable management or advisory agreement or the agreement governing the collateralized loan obligation;
  • the investment manager's or investment adviser's inability to continue to perform its obligations under any such agreement;
  • 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; or
  • an event or circumstance which threatens, or could reasonably be expected to threaten, the interests of holders of the debt securities.