Sec. 2. Reform of prohibition on swap activity assistance
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Section 716 of the Dodd-Frank Wall Street Reform and Consumer Protection Act ( 15 U.S.C. 8305 ) is amended— in subsection (b)— in paragraph (2)(B), by striking insured depository institution and inserting covered depository institution ; and by adding at the end the following: The term covered depository institution means— an insured depository institution, as that term is defined in section 3 of the Federal Deposit Insurance Act ( 12 U.S.C. 1813 ); and a United States uninsured branch or agency of a foreign bank. ; in subsection (c)— in the heading for such subsection, by striking and inserting insured ; covered by striking an insured and inserting a covered ; by striking such insured and inserting such covered ; and by striking or savings and loan holding company and inserting savings and loan holding company, or foreign banking organization (as such term is defined under Regulation K of the Board of Governors of the Federal Reserve System (12 C.F.R. 211.21(o))) ; by amending subsection
(d)to read as follows: The prohibition in subsection
(a)shall not apply to any covered depository institution that limits its swap and security-based swap activities to the following: Hedging and other similar risk mitigating activities directly related to the covered depository institution's activities. Acting as a swaps entity for swaps or security-based swaps other than a structured finance swap. Acting as a swaps entity for swaps or security-based swaps that are structured finance swaps, if— such structured finance swaps are undertaken for hedging or risk management purposes; or each asset-backed security underlying such structured finance swaps is of a credit quality and of a type or category with respect to which the prudential regulators have jointly adopted rules authorizing swap or security-based swap activity by covered depository institutions. For purposes of this subsection: The term structured finance swap means a swap or security-based swap based on an asset-backed security (or group or index primarily comprised of asset-backed securities). The term asset-backed security has the meaning given such term under section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)). ; in subsection (e), by striking an insured and inserting a covered ; and in subsection (f)— by striking an insured depository and inserting a covered depository ; and by striking the insured depository each place such term appears and inserting the covered depository .
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Sec. 2
Reform of prohibition on swap activity assistance
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