loan and it is subsequently determined that the CRE loan did not meet
all of the requirements set forth in paragraphs (a)(1) through (a)(9)
and (a)(11) of this section, the sponsor shall not lose the benefit of
the exception with respect to the CRE loan if the depositor complied
with the certification requirement set forth in paragraph (a)(10) of
this section, and:
    (1) The failure of the loan to meet any of the requirements set
forth in paragraphs (a)(1) through (a)(9) and (a)(11) of this section
is not material; or;
    (2) No later than 90 days after the determination that the loan
does not meet one or more of the requirements of paragraphs (a)(1)
through (a)(9) or (a)(11) of this section, the sponsor:
    (i) Effectuates cure, restoring conformity of the loan to the unmet
requirements as of the date of cure; or
    (ii) Repurchases the loan(s) from the issuing entity at a price at
least equal to the remaining principal balance and accrued interest on
the loan(s) as of the date of repurchase.
    (3) If the sponsor cures or repurchases pursuant to paragraph
(b)(2) of this section, the sponsor must promptly notify, or cause to
be notified, the holders of the asset-backed securities issued in the
securitization transaction of any loan(s) included in such
securitization transaction that is required to be cured or repurchased
by the sponsor pursuant to paragraph (b)(2) of this section, including
the principal amount of such repurchased loan(s) and the cause for such
cure or repurchase.

Sec.  ----.18  Underwriting standards for qualifying automobile loans.

    (a) Underwriting, product and other standards. (1) Prior to
origination of the automobile loan, the originator:
    (i) Verified and documented that within 30 days of the date of
origination:
    (A) The borrower was not currently 30 days or more past due, in
whole or in part, on any debt obligation;
    (B) Within the previous 24 months, the borrower has not been 60
days or more past due, in whole or in part, on any debt obligation;
    (C) Within the previous 36 months, the borrower has not:
    (1) Been a debtor in a proceeding commenced under Chapter 7
(Liquidation), Chapter 11 (Reorganization), Chapter 12 (Family Farmer
or Family Fisherman plan), or Chapter 13 (Individual Debt Adjustment)
of the U.S. Bankruptcy Code; or
    (2) Been the subject of any federal or State judicial judgment for
the collection of any unpaid debt;
    (D) Within the previous 36 months, no one-to-four family property
owned by the borrower has been the subject of any foreclosure, deed in
lieu of foreclosure, or short sale; or
    (E) Within the previous 36 months, the borrower has not had any
personal property repossessed;
    (ii) Determined and documented that the borrower has at least 24
months of credit history; and
    (iii) Determined and documented that, upon the origination of the
loan, the borrower's DTI ratio is less than or equal to 36 percent.
    (A) For the purpose of making the determination under paragraph
(a)(1)(iii) of this section, the originator must:
    (1) Verify and document all income of the borrower that the
originator includes in the borrower's effective monthly income (using
payroll stubs, tax returns, profit and loss statements, or other
similar documentation); and
    (2) On or after the date of the borrower's written application and
prior to origination, obtain a credit report regarding the borrower
from a consumer reporting agency that compiles and maintain files on
consumers on a nationwide basis (within the meaning of 15 U.S.C.
1681a(p)) and verify that all outstanding debts reported in the
borrower's credit report are incorporated into the calculation of the
borrower's DTI ratio under paragraph (a)(1)(ii) of this section;
    (2) An originator will be deemed to have met the requirements of
paragraph (a)(1)(i) of this section if:
    (i) The originator, no more than 30 days before the closing of the
loan, obtains a credit report regarding the borrower from a consumer
reporting agency that compiles and maintains files on consumers on a
nationwide basis (within the meaning of 15 U.S.C. 1681a(p));
    (ii) Based on the information in such credit report, the borrower
meets all of the requirements of paragraph (a)(1)(i) of this section,
and no information in a credit report subsequently obtained by the
originator before the closing of the loan contains contrary
information; and
    (iii) The originator obtains electronic or hard copies of the
credit report.
    (3) At closing of the automobile loan, the borrower makes a down
payment from the borrower's personal funds and trade-in allowance, if
any, that is at least equal to the sum of:
    (i) The full cost of the vehicle title, tax, and registration fees;
    (ii) Any dealer-imposed fees;
    (iii) The full cost of any additional warranties, insurance or
other products purchased in connection with the purchase of the
vehicle; and
    (iv) 10 percent of the vehicle purchase price.
    (4) The originator records a first lien securing the loan on the
purchased vehicle in accordance with State law.
    (5) The terms of the loan agreement provide a maturity date for the
loan that does not exceed the lesser of:
    (i) Six years from the date of origination, or
    (ii) 10 years minus the difference between the current model year
and the vehicle's model year.
    (6) The terms of the loan agreement:
    (i) Specify a fixed rate of interest for the life of the loan;
    (ii) Provide for a level monthly payment amount that fully
amortizes the amount financed over the loan term;
    (iii) Do not permit the borrower to defer repayment of principal or
payment of interest; and
    (iv) Require the borrower to make the first payment on the
automobile loan within 45 days of the loan's contract date.
    (7) At the closing of the securitization transaction, all payments
due on the loan are contractually current; and
    (8)(i) The depositor of the asset-backed security certifies that it
has evaluated the effectiveness of its internal supervisory controls
with respect to the process for ensuring that all qualifying automobile
loans that collateralize the asset-backed security and that reduce the
sponsor's risk retention requirement under Sec.  ----.15 meet all of
the requirements set forth in paragraphs (a)(1) through (a)(7) of this
section and has concluded that its internal supervisory controls are
effective;
    (ii) The evaluation of the effectiveness of the depositor's
internal supervisory controls referenced in paragraph (a)(8)(i) of this
section shall be performed, for each issuance of an asset-backed
security, as of a date within 60 days of the cut-off date or similar
date for establishing the composition of the asset

pool collateralizing such asset-backed security; and
    (iii) The sponsor provides, or causes to be provided, a copy of the
certification described in paragraph (a)(8)(i) of this section to
potential investors a reasonable period of time prior to the sale of
asset-backed securities in the issuing entity, and, upon request, to
its appropriate Federal banking agency, if any.
    (b) Cure or buy-back requirement. If a sponsor has relied on the
exception provided in Sec.  ------.15 with respect to a qualifying
automobile loan and it is subsequently determined that the loan did not
meet all of the requirements set forth in paragraphs (a)(1) through
(a)(7) of this section, the sponsor shall not lose the benefit of the
exception with respect to the automobile loan if the depositor complied
with the certification requirement set forth in paragraph (a)(8) of
this section, and:
    (1) The failure of the loan to meet any of the requirements set
forth in paragraphs (a)(1) through (a)(7) of this section is not
material; or
    (2) No later than ninety (90) days after the determination that the
loan does not meet one or more of the requirements of paragraphs (a)(1)
through (a)(7) of this section, the sponsor:
    (i) Effectuates cure, establishing conformity of the loan to the
unmet requirements as of the date of cure; or
    (ii) Repurchases the loan(s) from the issuing entity at a price at
least equal to the remaining principal balance and accrued interest on
the loan(s) as of the date of repurchase.
    (3) If the sponsor cures or repurchases pursuant to paragraph
(b)(2) of this section, the sponsor must promptly notify, or cause to
be notified, the holders of the asset-backed securities issued in the
securitization transaction of any loan(s) included in such
securitization transaction that is required to be cured or repurchased
by the sponsor pursuant to paragraph (b)(2) of this section, including
the principal amount of such loan(s) and the cause for such cure or
repurchase.

Sec.  ----.19  General exemptions.

    (a) Definitions. For purposes of this section, the following
definitions shall apply:
    First pay class means a class of ABS interests for which all
interests in the class are entitled to the same priority of payment and
that, at the time of closing of the transaction, is entitled to
repayments of principal and payments of interest prior to or pro-rata
with all other classes of securities collateralized by the same pool of
first-lien residential mortgages, until such class has no principal or
notional balance remaining.
    Inverse floater means an ABS interest issued as part of a
securitization transaction for which interest or other income is
payable to the holder based on a rate or formula that varies inversely
to a reference rate of interest.
    (b) This part shall not apply to:
    (1) U.S. Government-backed securitizations. Any securitization
transaction that:
    (i) Is collateralized solely by residential, multifamily, or health
care facility mortgage loan assets that are insured or guaranteed (in
whole or in part) as to the payment of principal and interest by the
United States or an agency of the United States, and servicing assets;
or
    (ii) Involves the issuance of asset-backed securities that:
    (A) Are insured or guaranteed as to the payment of principal and
interest by the United States or an agency of the United States; and
    (B) Are collateralized solely by residential, multifamily, or
health care facility mortgage loan assets or interests in such assets,
and servicing assets.
    (2) Certain agricultural loan securitizations. Any securitization
transaction that is collateralized solely by loans or other assets
made, insured, guaranteed, or purchased by any institution that is
subject to the supervision of the Farm Credit Administration, including
the Federal Agricultural Mortgage Corporation, and servicing assets;
    (3) State and municipal securitizations. Any asset-backed security
that is a security issued or guaranteed by any State, or by any
political subdivision of a State, or by any public instrumentality of a
State that is exempt from the registration requirements of the
Securities Act of 1933 by reason of section 3(a)(2) of that Act (15
U.S.C. 77c(a)(2)); and
    (4) Qualified scholarship funding bonds. Any asset-backed security
that meets the definition of a qualified scholarship funding bond, as
set forth in section 150(d)(2) of the Internal Revenue Code of 1986 (26
U.S.C. 150(d)(2)).
    (5) Pass-through resecuritizations. Any securitization transaction
that:
    (i) Is collateralized solely by servicing assets, and by existing
asset-backed securities:
    (A) For which credit risk was retained as required under subpart B
of this part; or
    (B) That was exempted from the credit risk retention requirements
of this part pursuant to subpart D of this part;
    (ii) Is structured so that it involves the issuance of only a
single class of ABS interests; and
    (iii) Provides for the pass-through of all principal and interest
payments received on the underlying ABS (net of expenses of the issuing
entity) to the holders of such class.
    (6) First-pay-class securitizations. Any securitization transaction
that:
    (i) Is collateralized solely by servicing assets, and by first-pay
classes of asset-backed securities collateralized by first-lien
residential mortgages on properties located in any state and servicing
assets:
    (A) For which credit risk was retained as required under subpart B
of this part; or
    (B) That was exempted from the credit risk retention requirements
of this part pursuant to subpart D of this part;
    (ii) Does not provide for any ABS interest issued in the
securitization transaction to share in realized principal losses other
than pro rata with all other ABS interests based on current unpaid
principal balance of the ABS interests at the time the loss is
realized;
    (iii) Is structured to reallocate prepayment risk;
    (iv) Does not reallocate credit risk (other than as a consequence
of reallocation of prepayment risk); and
    (v) Does not include any inverse floater or similarly structured
ABS interest.
    (7) Seasoned loans. (i) Any securitization transaction that is
collateralized solely by servicing assets, and by seasoned loans that
meet the following requirements:
    (A) The loans have not been modified since origination; and
    (B) None of the loans have been delinquent for 30 days or more.
    (ii) For purposes of this paragraph, a seasoned loan means:
    (A) With respect to asset-backed securities backed by residential
mortgages, a loan that has been outstanding and performing for the
longer of:
    (1) A period of five years; or
    (2) Until the outstanding principal balance of the loan has been
reduced to 25 percent of the original principal balance.
    (3) Notwithstanding paragraphs (b)(7)(ii)(A)(1) and
(b)(7)(ii)(A)(2) of this section, any residential mortgage loan that
has been outstanding and performing for a period of at least seven
years shall be deemed a seasoned loan.
    (B) With respect to all other classes of asset-backed securities, a
loan that has been outstanding and performing for the longer of:
    (1) A period of at least two years; or
    (2) Until the outstanding principal balance of the loan has been
reduced to

33 percent of the original principal balance.
    (8) Certain public utility securitizations. (i) Any securitization
transaction where the asset-back securities issued in the transaction
are secured by the intangible property right to collect charges for the
recovery of specified costs and such other assets, if any, of an
issuing entity that is wholly owned, directly or indirectly by an
investor owned utility company that is subject to the regulatory
authority of a State public utility commission or other appropriate
State agency.
    (ii) For purposes of this paragraph:
    (A) Specified cost means any cost identified by a State legislature
as appropriate for recovery through securitization pursuant to
specified cost recovery legislation; and
    (B) Specified cost recovery legislation means legislation enacted
by a State that:
    (1) Authorizes the investor owned utility company to apply for, and
authorizes the public utility commission or other appropriate State
agency to issue, a financing order determining the amount of specified
costs the utility will be allowed to recover;
    (2) Provides that pursuant to a financing order, the utility
acquires an intangible property right to charge, collect, and receive
amounts necessary to provide for the full recovery of the specified
costs determined to be recoverable, and assures that the charges are
non-bypassable and will be paid by customers within the utility's
historic service territory who receive utility goods or services
through the utility's transmission and distribution system, even if
those customers elect to purchase these goods or services from a third
party; and
    (3) Guarantees that neither the State nor any of its agencies has
the authority to rescind or amend the financing order, to revise the
amount of specified costs, or in any way to reduce or impair the value
of the intangible property right, except as may be contemplated by
periodic adjustments authorized by the specified cost recovery
legislation.
    (c) Exemption for securitizations of assets issued, insured or
guaranteed by the United States. This part shall not apply to any
securitization transaction if the asset-backed securities issued in the
transaction are:
    (1) Collateralized solely by obligations issued by the United
States or an agency of the United States and servicing assets;
    (2) Collateralized solely by assets that are fully insured or
guaranteed as to the payment of principal and interest by the United
States or an agency of the United States (other than those referred to
in paragraph (b)(1)(i) of this section) and servicing assets; or
    (3) Fully guaranteed as to the timely payment of principal and
interest by the United States or any agency of the United States;
    (d) Federal Deposit Insurance Corporation securitizations. This
part shall not apply to any securitization transaction that is
sponsored by the Federal Deposit Insurance Corporation acting as
conservator or receiver under any provision of the Federal Deposit
Insurance Act or of Title II of the Dodd-Frank Wall Street Reform and
Consumer Protection Act.
    (e) Reduced requirement for certain student loan securitizations.
The 5 percent risk retention requirement set forth in Sec.  ----.4
shall be modified as follows:
    (1) With respect to a securitization transaction that is
collateralized solely by student loans made under the Federal Family
Education Loan Program (``FFELP loans'') that are guaranteed as to 100
percent of defaulted principal and accrued interest, and servicing
assets, the risk retention requirement shall be 0 percent;
    (2) With respect to a securitization transaction that is
collateralized solely by FFELP loans that are guaranteed as to at least
98 percent of defaulted principal and accrued interest, and servicing
assets, the risk retention requirement shall be 2 percent; and
    (3) With respect to any other securitization transaction that is
collateralized solely by FFELP loans, and servicing assets, the risk
retention requirement shall be 3 percent.
    (f) Rule of construction. Securitization transactions involving the
issuance of asset-backed securities that are either issued, insured, or
guaranteed by, or are collateralized by obligations issued by, or loans
that are issued, insured, or guaranteed by, the Federal National
Mortgage Association, the Federal Home Loan Mortgage Corporation, or a
Federal home loan bank shall not on that basis qualify for exemption
under this section.

Sec.  ----.20  Safe harbor for certain foreign-related transactions.

    (a) Definitions. For purposes of this section, the following
definition shall apply:
    U.S. person means:
    (1) Any of the following:
    (i) Any natural person resident in the United States;
    (ii) Any partnership, corporation, limited liability company, or
other organization or entity organized or incorporated under the laws
of any State or of the United States;
    (iii) Any estate of which any executor or administrator is a U.S.
person;
    (iv) Any trust of which any trustee is a U.S. person;
    (v) Any agency or branch of a foreign entity located in the United
States;
    (vi) Any non-discretionary account or similar account (other than
an estate or trust) held by a dealer or other fiduciary for the benefit
or account of a U.S. person;
    (vii) Any discretionary account or similar account (other than an
estate or trust) held by a dealer or other fiduciary organized,
incorporated, or (if an individual) resident in the United States; and
    (viii) Any partnership, corporation, limited liability company, or
other organization or entity if:
    (A) Organized or incorporated under the laws of any foreign
jurisdiction; and
    (B) Formed by a U.S. person principally for the purpose of
investing in securities not registered under the Act; and
    (2) ``U.S. person(s)'' does not include:
    (i) Any discretionary account or similar account (other than an
estate or trust) held for the benefit or account of a non-U.S. person
by a dealer or other professional fiduciary organized, incorporated, or
(if an individual) resident in the United States;
    (ii) Any estate of which any professional fiduciary acting as
executor or administrator is a U.S. person if:
    (A) An executor or administrator of the estate who is not a U.S.
person has sole or shared investment discretion with respect to the
assets of the estate; and
    (B) The estate is governed by foreign law;
    (iii) Any trust of which any professional fiduciary acting as
trustee is a U.S. person, if a trustee who is not a U.S. person has
sole or shared investment discretion with respect to the trust assets,
and no beneficiary of the trust (and no settlor if the trust is
revocable) is a U.S. person;
    (iv) An employee benefit plan established and administered in
accordance with the law of a country other than the United States and
customary practices and documentation of such country;
    (v) Any agency or branch of a U.S. person located outside the
United States if:
    (A) The agency or branch operates for valid business reasons; and
    (B) The agency or branch is engaged in the business of insurance or
banking and is subject to substantive insurance or banking regulation,
respectively, in the jurisdiction where located;
    (vi) The International Monetary Fund, the International Bank for

Reconstruction and Development, the Inter-American Development Bank,
the Asian Development Bank, the African Development Bank, the United
Nations, and their agencies, affiliates and pension plans, and any
other similar international organizations, their agencies, affiliates
and pension plans.
    (b) In general. This part shall not apply to a securitization
transaction if all the following conditions are met:
    (1) The securitization transaction is not required to be and is not
registered under the Securities Act of 1933 (15 U.S.C. 77a et seq.);
    (2) No more than 10 percent of the dollar value (or equivalent
amount in the currency in which the ABS is issued, as applicable) of
all classes of ABS interests in the securitization transaction are sold
or transferred to U.S. persons or for the account or benefit of U.S.
persons;
    (3) Neither the sponsor of the securitization transaction nor the
issuing entity is:
    (i) Chartered, incorporated, or organized under the laws of the
United States or any State;
    (ii) An unincorporated branch or office (wherever located) of an
entity chartered, incorporated, or organized under the laws of the
United States or any State; or
    (iii) An unincorporated branch or office located in the United
States or any State of an entity that is chartered, incorporated, or
organized under the laws of a jurisdiction other than the United States
or any State; and
    (4) If the sponsor or issuing entity is chartered, incorporated, or
organized under the laws of a jurisdiction other than the United States
or any State, no more than 25 percent (as determined based on unpaid
principal balance) of the assets that collateralize the ABS interests
sold in the securitization transaction were acquired by the sponsor or
issuing entity, directly or indirectly, from:
    (i) A majority-owned affiliate of the sponsor or issuing entity
that is chartered, incorporated, or organized under the laws of the
United States or any State; or
    (ii) An unincorporated branch or office of the sponsor or issuing
entity that is located in the United States or any State.
    (b) Evasions prohibited. In view of the objective of these rules
and the policies underlying Section 15G of the Exchange Act, the safe
harbor described in paragraph (a) of this section is not available with
respect to any transaction or series of transactions that, although in
technical compliance with such paragraph (a) of this section, is part
of a plan or scheme to evade the requirements of section 15G and this
Regulation. In such cases, compliance with section 15G and this part is
required.

Sec.  ----.21  Additional exemptions.

    (a) Securitization transactions. The federal agencies with
rulewriting authority under section 15G(b) of the Exchange Act (15
U.S.C. 78o-11(b)) with respect to the type of assets involved may
jointly provide a total or partial exemption of any securitization
transaction as such agencies determine may be appropriate in the public
interest and for the protection of investors.
    (b) Exceptions, exemptions, and adjustments. The Federal banking
agencies and the Commission, in consultation with the Federal Housing
Finance Agency and the Department of Housing and Urban Development, may
jointly adopt or issue exemptions, exceptions or adjustments to the
requirements of this part, including exemptions, exceptions or
adjustments for classes of institutions or assets in accordance with
section 15G(e) of the Exchange Act (15 U.S.C. 78o-11(e)).

End of Common Rule

List of Subjects

12 CFR Part 43

    Automobile loans, Banks and banking, Commercial loans, Commercial
real estate, Credit risk, Mortgages, National banks, Reporting and
recordkeeping requirements, Risk retention, Securitization.

12 CFR Part 244

    Auto loans, Banks and banking, Bank holding companies, Commercial
loans, Commercial real estate, Credit risk, Edge and agreement
corporations, Foreign banking organizations, Mortgages, Nonbank
financial companies, Reporting and recordkeeping requirements, Risk
retention, Savings and loan holding companies, Securitization, State
member banks.

12 CFR Part 373

    Automobile loans, Banks and banking, Commercial loans, Commercial
real estate, Credit risk, Mortgages, Reporting and recordkeeping
requirements, Risk retention, Savings associations, Securitization.

12 CFR Part 1234

    Government sponsored enterprises, Mortgages, Securities.

17 CFR Part 246

    Reporting and recordkeeping requirements, Securities.

24 CFR Part 267

    Mortgages.

Adoption of the Common Rule Text

    The proposed adoption of the common rules by the agencies, as
modified by agency-specific text, is set forth below:

DEPARTMENT OF THE TREASURY

Office of the Comptroller of the Currency

12 CFR Chapter I

Authority and Issuance

    For the reasons stated in the common preamble and under the
authority of 12 U.S.C. 93a, 1464, 5412(b)(2)(B), and 15 U.S.C. 78o-11,
the Office of the Comptroller of the Currency proposes to amend chapter
I of title 12, Code of Federal Regulations as follows:

PART 43--CREDIT RISK RETENTION

0
1. The authority for part 43 is added to read as follows:

    Authority: 12 U.S.C. 1 et seq., 93a, 161, 1464, 1818,
5412(b)(2)(B), and 15 U.S.C. 78o-11.

0
2. Part 43 is added as set forth at the end of the Common Preamble.
0
3. Section 43.1 is added to read as follows:

Sec.  43.1  Authority, purpose, scope, and reservation of authority.

    (a) Authority. This part is issued under the authority of 12 U.S.C.
1 et seq., 93a, 161, 1464, 1818, 5412(b)(2)(B), and 15 U.S.C. 78o-11.
    (b) Purpose. (1) This part requires securitizers to retain an
economic interest in a portion of the credit risk for any asset that
the securitizer, through the issuance of an asset-backed security,
transfers, sells, or conveys to a third party. This part specifies the
permissible types, forms, and amounts of credit risk retention, and it
establishes certain exemptions for securitizations collateralized by
assets that meet specified underwriting standards.
    (2) Nothing in this part shall be read to limit the authority of
the OCC to take supervisory or enforcement action, including action to
address unsafe or unsound practices or conditions, or violations of
law.
    (c) Scope. This part applies to any securitizer that is a national
bank, a Federal savings association, a Federal branch or agency of a
foreign bank, or a subsidiary thereof.
    (d) Effective dates. This part shall become effective:
    (1) With respect to any securitization transaction collateralized
by residential

mortgages, one year after the date on which final rules under section
15G(b) of the Exchange Act (15 U.S.C. 78o-11(b)) are published in the
Federal Register; and
    (2) With respect to any other securitization transaction, two years
after the date on which final rules under section 15G(b) of the
Exchange Act (15 U.S.C. 78o-11(b)) are published in the Federal
Register.

Board of Governors of the Federal Reserve System

12 CFR Chapter II

Authority and Issuance

    For the reasons set forth in the Supplementary Information, the
Board of Governors of the Federal Reserve System proposes to add the
text of the common rule as set forth at the end of the Supplementary
Information as part 244 to chapter II of title 12, Code of Federal
Regulations, modified as follows:

PART 244--CREDIT RISK RETENTION (REGULATION RR)

0
4. The authority citation for part 244 is added to reads as follows:

    Authority:  12 U.S.C. 221 et seq., 1461 et seq., 1818, 1841 et
seq., 3103 et seq., and 15 U.S.C. 78o-11.

0
4a. The part heading for part 244 is revised as set forth above.
0
5. Section 244.1 is added to read as follows:

Sec.  244.1  Authority, purpose, and scope.

    (a) Authority--(1) In general. This part (Regulation RR) is issued
by the Board of Governors of the Federal Reserve System under section
15G of the Securities Exchange Act of 1934, as amended (Exchange Act)
(15 U.S.C. 78o-11), as well as under the Federal Reserve Act, as
amended (12 U.S.C. 221 et seq.); section 8 of the Federal Deposit
Insurance Act (FDI Act), as amended (12 U.S.C. 1818); the Bank Holding
Company Act of 1956, as amended (BHC Act) (12 U.S.C. 1841 et seq.); the
Home Owners' Loan Act of 1933 (HOLA) (12 U.S.C. 1461 et seq.); section
165 of the Dodd-Frank Wall Street Reform and Consumer Protection Act
(Dodd-Frank Act) (12 U.S.C. 5365); and the International Banking Act of
1978, as amended (12 U.S.C. 3101 et seq.).
    (2) Nothing in this part shall be read to limit the authority of
the Board to take action under provisions of law other than 15 U.S.C.
78o-11, including action to address unsafe or unsound practices or
conditions, or violations of law or regulation, under section 8 of the
FDI Act.
    (b) Purpose. This part requires any securitizer to retain an
economic interest in a portion of the credit risk for any asset that
the securitizer, through the issuance of an asset-backed security,
transfers, sells, or conveys to a third party in a transaction within
the scope of section 15G of the Exchange Act. This part specifies the
permissible types, forms, and amounts of credit risk retention, and
establishes certain exemptions for securitizations collateralized by
assets that meet specified underwriting standards or that otherwise
qualify for an exemption.
    (c) Scope. (1) This part applies to any securitizer that is:
    (i) A state member bank (as defined in 12 CFR 208.2(g)); or
    (ii) Any subsidiary of a state member bank.
    (2) Section 15G of the Exchange Act and the rules issued thereunder
apply to any securitizer that is:
    (i) A bank holding company (as defined in 12 U.S.C. 1842);
    (ii) A foreign banking organization (as defined in 12 CFR
211.21(o));
    (iii) An Edge or agreement corporation (as defined in 12 CFR
211.1(c)(2) and (3));
    (iv) A nonbank financial company that the Financial Stability
Oversight Council has determined under section 113 of the Dodd-Frank
Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act) (12
U.S.C. 5323) shall be supervised by the Board and for which such
determination is still in effect; or
    (v) A savings and loan holding company (as defined in 12 U.S.C.
1467a); and
    (vi) Any subsidiary of the foregoing. The Federal Reserve will
enforce section 15G of the Exchange Act and the rules issued thereunder
under section 8 of the FDI Act against any of the foregoing entities.

Federal Deposit Insurance Corporation

12 CFR Chapter III

Authority and Issuance

    For the reasons set forth in the SUPPLEMENTARY INFORMATION, the
Federal Deposit Insurance Corporation proposes to add the text of the
common rule as set forth at the end of the SUPPLEMENTARY INFORMATION as
part 373 to chapter III of title 12, Code of Federal Regulations,
modified as follows:

PART 373--CREDIT RISK RETENTION

0
6. The authority citation for part 373 is added to reads as follows:

    Authority:  12 U.S.C. 1801 et seq. and 3103 et seq., and 15
U.S.C. 78o-11.

0
7. Section 373.1 is added to read as follows:

Sec.  373.1  Purpose and scope.

    (a) Authority--(1) In general. This part is issued by the Federal
Deposit Insurance Corporation (FDIC) under section 15G of the
Securities Exchange Act of 1934, as amended (Exchange Act) (15 U.S.C.
78o-11), as well as the Federal Deposit Insurance Act (12 U.S.C. 1801
et seq.) and the International Banking Act of 1978, as amended (12
U.S.C. 3101 et seq.).
    (2) Nothing in this part shall be read to limit the authority of
the FDIC to take action under provisions of law other than 15 U.S.C.
78o-11, including to address unsafe or unsound practices or conditions,
or violations of law or regulation under section 8 of the Federal
Deposit Insurance Act (12 U.S.C. 1818).
    (b) Purpose. (1) This part requires securitizers to retain an
economic interest in a portion of the credit risk for any asset that
the securitizer, through the issuance of an asset-backed security,
transfers, sells, or conveys to a third party in a transaction within
the scope of section 15G of the Exchange Act. This part specifies the
permissible types, forms, and amounts of credit risk retention, and it
establishes certain exemptions for securitizations collateralized by
assets that meet specified underwriting standards or that otherwise
qualify for an exemption.
    (c) Scope. This part applies to any securitizer that is:
    (1) A state nonmember bank (as defined in 12 U.S.C. 1813(e)(2));
    (2) An insured federal or state branch of a foreign bank (as
defined in 12 CFR 347.202);
    (3) A state savings association (as defined in 12 U.S.C.
1813(b)(3)); or
    (4) Any subsidiary of an entity described in paragraphs (1), (2),
or (3) of this section.

Federal Housing Finance Agency

    For the reasons stated in the SUPPLEMENTARY INFORMATION, and under
the authority of 12 U.S.C. 4526, the Federal Housing Finance Agency
proposes to add the text of the common rule as set forth at the end of
the Supplementary Information as part 1234 of subchapter B of chapter
XII of title 12 of the Code of Federal Regulations, modified as
follows:

Chapter XII--Federal Housing Finance Agency

Subchapter B--Entity Regulations

PART 1234--CREDIT RISK RETENTION

0
8. The authority citation for part 1234 is added to read as follows:

    Authority:  12 U.S.C. 4511(b), 4526, 4617; 15 U.S.C. 78o-
11(b)(2).
0
9. Section 1234.1 is added to read as follows:

Sec.  1234.1  Purpose, scope and reservation of authority.

    (a) Purpose. This part requires securitizers to retain an economic
interest in a portion of the credit risk for any residential mortgage
asset that the securitizer, through the issuance of an asset-backed
security, transfers, sells, or conveys to a third party in a
transaction within the scope of section 15G of the Exchange Act. This
part specifies the permissible types, forms, and amounts of credit risk
retention, and it establishes certain exemptions for securitizations
collateralized by assets that meet specified underwriting standards or
that otherwise qualify for an exemption.
    (b) Scope. Effective [INSERT DATE ONE YEAR AFTER DATE OF
PUBLICATION IN THE Federal Register AS A FINAL RULE], this part will
apply to any securitizer that is an entity regulated by the Federal
Housing Finance Agency.
    (c) Reservation of authority. Nothing in this part shall be read to
limit the authority of the Director of the Federal Housing Finance
Agency to take supervisory or enforcement action, including action to
address unsafe or unsound practices or conditions, or violations of
law.
0
10. Amend Sec.  1234.14 as follows:
0
a. Revise the heading to read as set forth below.
0
b. In the introductory paragraph, remove the words ``Sec. Sec.  1234.15
through 1234.18'' and add in their place the words ``Sec. Sec.  1234.15
and 1234.17''.
0
c. Remove the definitions of ``Automobile loan'', ``Commercial loan'',
``Debt-to-income (DTI) ratio'', ``Earnings before interest, taxes,
depreciation, and amortization (EBITDA)'', ``Lease financing'',
``Leverage Ratio'', ``Machinery and equipment (M&E) collateral'',
``Model year'', ``Payment-in-kind'', ``Purchase price'', ``Salvage
title'', ``Total debt'', ``Total liabilities ratio'', and ``Trade-in
allowance''.
0
d. Revise the definition of ``Debt service coverage (DSC) ratio'' to
read as follows:

Sec.  1234.14  Definitions applicable to qualifying commercial real
estate loans.

* * * * *
    Debt service coverage (DSC) ratio means the ratio of:
    (1) The annual NOI less the annual replacement reserve of the CRE
property at the time of origination of the CRE loans; to
    (2) The sum of the borrower's annual payments for principal and
interest on any debt obligation.
* * * * *
0
11. Revise Sec.  1234.15 to read as follows:

Sec.  1234.15  Qualifying commercial real estate loans.

    (a) General exception. Commercial real estate loans that are
securitized through a securitization transaction shall be subject to a
0 percent risk retention requirement under subpart B, provided that the
following conditions are met:
    (1) The CRE assets meet the underwriting standards set forth in
Sec.  1234.16;
    (2) The securitization transaction is collateralized solely by CRE
loans and by servicing assets;
    (3) The securitization transaction does not permit reinvestment
periods; and
    (4) The sponsor provides, or causes to be provided, to potential
investors a reasonable period of time prior to the sale of asset-backed
securities of the issuing entity, and, upon request, to the Commission,
and to the FHFA, in written form under the caption ``Credit Risk
Retention'':
    (i) A description of the manner in which the sponsor determined the
aggregate risk retention requirement for the securitization transaction
after including qualifying CRE loans with 0 percent risk retention; and
    (ii) Descriptions of the qualifying CRE loans and descriptions of
the CRE loans that are not qualifying CRE loans, and the material
differences between the group of qualifying CRE loans and CRE loans
that are not qualifying loans with respect to the composition of each
group's loan balances, loan terms, interest rates, borrower credit
information, and characteristics of any loan collateral.
    (b) Risk retention requirement. For any securitization transaction
described in paragraph (a) of this section, the amount of risk
retention required under Sec.  1234.3(b)(1) is reduced by the same
amount as the ratio of the unpaid principal balance of the qualifying
CRE loans to the total unpaid principal balance of CRE loans that are
included in the pool of assets collateralizing the asset-backed
securities issued pursuant to the securitization transaction (the
qualifying asset ratio); provided that;
    (1) The qualifying asset ratio is measured as of the cut-off date
or similar date for establishing the composition of the pool assets
collateralizing the asset-backed securities issued pursuant to the
securitization transaction; and
    (2) The qualifying asset ratio does not exceed 50 percent.
    (c) Exception for securitizations of qualifying CRE only.
Notwithstanding other provisions of this section, the risk retention
requirements of subpart B of this part shall not apply to
securitization transactions where the transaction is collateralized
solely by servicing assets and qualifying CRE loans.

Sec. Sec.  1234.16 and 1234.18  [Removed and Reserved]

0
12. Remove and reserve Sec. Sec.  1234.16 and 1234.18.

Securities and Exchange Commission

    For the reasons stated in the Supplementary Information, the
Securities and Exchange Commission proposes the amendments under the
authority set forth in Sections 7, 10, 19(a), and 28 of the Securities
Act and Sections 3, 13, 15, 15G, 23 and 36 of the Exchange Act.
    For the reasons set out above, title 17, chapter II of the Code of
Federal Regulations is proposed to be amended as follows:

PART 246--CREDIT RISK RETENTION

0
13. The authority citation for part 246 is added to read as follows:

    Authority:  15 U.S.C. 77g, 77j, 77s, 77z-3, 78c, 78m, 78o, 78o-
11, 78w, 78mm

0
14. Part 246 is added as set forth at the end of the Common Preamble.
0
15. Section 246.1 is added to read as follows:

Sec.  246.1  Purpose, scope, and authority.

    (a) Authority and purpose. This part (Regulation RR) is issued by
the Securities and Exchange Commission (``Commission'') jointly with
the Board of Governors of the Federal Reserve System, the Federal
Deposit Insurance Corporation, the Office of the Comptroller of the
Currency, and, in the case of the securitization of any residential
mortgage asset, together with the Secretary of Housing and Urban
Development and the Federal Housing Finance Agency, pursuant to Section
15G of the Securities Exchange Act of 1934 (15 U.S.C. 78o-11). The
Commission also is issuing this part pursuant to its authority under
Sections 7, 10, 19(a), and 28 of the Securities Act and Sections 3, 13,
15, 23, and 36 of the Exchange Act. This part requires securitizers to
retain an economic interest in a portion of the credit risk for any
asset that the securitizer, through the issuance of an asset-backed
security, transfers, sells, or conveys to a third party. This part
specifies the

permissible types, forms, and amounts of credit risk retention, and
establishes certain exemptions for securitizations collateralized by
assets that meet specified underwriting standards or otherwise qualify
for an exemption.
    (b) The authority of the Commission under this part shall be in
addition to the authority of the Commission to otherwise enforce the
federal securities laws, including, without limitation, the antifraud
provisions of the securities laws.

Department of Housing and Urban Development

Authority and Issuance

    For the reasons stated in the SUPPLEMENTARY INFORMATION, HUD
proposes to add the text of the common rule as set forth at the end of
the SUPPLEMENTARY INFORMATION to 24 CFR chapter II, subchapter B, as a
new part 267 to read as follows:

PART 267--CREDIT RISK RETENTION

0
16. The authority citation for part 267 is added to read as follows:

    Authority: 15 U.S.C. 78-o-11; 42 U.S.C. 3535(d).

0
17. Section 267.1 is added to read as follows:

Sec.  267.1  Credit risk retention exceptions and exemptions for HUD
programs.

    The credit risk retention regulations codified at 12 CFR part 43
(Office of the Comptroller of the Currency); 12 CFR part 244 (Federal
Reserve System); 12 CFR part 373 (Federal Deposit Insurance
Corporation); 17 CFR part 246 (Securities and Exchange Commission); and
12 CFR part 1234 (Federal Housing Finance Agency) include exceptions
and exemptions in subpart D of each of these codified regulations for
certain transactions involving programs and entities under the
jurisdiction of the Department of Housing and Urban Development.

    Dated: August 28, 2013.
Thomas J. Curry,
Comptroller of the Currency.

    By order of the Board of Governors of the Federal Reserve
System, August 27, 2013.
Robert deV. Frierson,
Secretary of the Board.

    Dated at Washington, DC, this 28 of August 2013.

    By order of the Board of Directors.

Federal Deposit Insurance Corporation.
Robert E. Feldman,
Executive Secretary.

    Dated: August 28, 2013.

    By the Securities and Exchange Commission.
Elizabeth M. Murphy
Secretary.

    Dated: August 28, 2013.
Edward J. DeMarco,
Acting Director, Federal Housing Finance Agency.

    Dated: August 26, 2013.

    By the Department of Housing and Urban Development.
Shaun Donovan,
Secretary.
[FR Doc. 2013-21677 Filed 9-19-13; 8:45 am]
BILLING CODE 4810-33-P; 6210-01-P; 6741-01-P; 8010-01-P; 8070-01-P;


[Federal Register: October 26, 2010 (Volume 75, Number 206)]
[Proposed Rules]
[Page 65585-65586]
[DOCID:fr26oc10-18]

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 71

[Docket No. FAA-2010-0323; Airspace Docket No. 10-ANE-106]

Proposed Establishment of Class E Airspace; Lancaster, NH

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Notice of proposed rulemaking (NPRM), withdrawal.

-----------------------------------------------------------------------

SUMMARY: This action withdraws the NPRM published in the Federal
Register on July 22, 2010 which proposed to establish Class E airspace
at Weeks Medical Center Heliport, Lancaster, NH. The NPRM is being
withdrawn as a portion of the proposed airspace already exists. A new
rulemaking will be forthcoming to correctly establish the new airspace.

DATES: Effective 0901 UTC, October 26, 2010.

FOR FURTHER INFORMATION CONTACT: Richard Horrocks, Operations Support
Group, Eastern Service Center, Federal Aviation Administration, P.O.
Box 20636, Atlanta, Georgia 30320; telephone<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

History

    On July 22, 2010, a NPRM was published in the Federal Register to
establish Class E airspace at Lancaster, NH to accommodate special
standard instrument approach procedures for Weeks Medical Center
Heliport. (75 FR 42630) Docket No. FAA-2010-0323. After publication the
FAA found that the airspace description in the proposed rule
incorrectly included existing controlled airspace 1,200 feet above the
surface. To avoid confusion, this proposed rule is being withdrawn and
will be established under another rulemaking.

Lists of Subjects in 14 CFR Part 71

    Airspace, Incorporation by reference, Navigation (Air).

The Withdrawal

    Accordingly, pursuant to the authority delegated to me, the Notice
of

Proposed Rulemaking, Airspace Docket No. 10-ANE-106, as published in
the Federal Register on July 22, 2010 (75 FR 42630) (FR Doc. 2010-
0323), is hereby withdrawn.

    Authority:  49 U.S.C. 106(g); 40103, 40113, 40120; E.O. 10854,
24 FR 9565, 3 CFR, 1959-1963 Comp., p. 389.

    Issued in College Park, Georgia, on October 15, 2010.
Mark D. Ward,
Manager, Operations Support Group, Eastern Service Center, Air Traffic
Organization.
[FR Doc. 2010-26943 Filed 10-25-10; 8:45 am]
BILLING CODE 4910-13-P