,i #aac? ,,congress #a/ ,session ,h4 ,r4 #fac ,,9 ,,! ,,h\se ,,( ,,repres5tatives ,febru>y #ab1 #bjac ,mr4 ,campbell introduc$ ! foll[+ bill2 :i* 0 ref]r$ to ! ,committee on ,f9ancial ,s]vices ,a ,,bill ,to e/abli% a m>ket-bas$ trigg] to det]m9e ! capital adequacy ( bank hold+ companies & decrease sy/emic risk1 & = o!r purposes4 #a4 ,%ort title ,?is ,act may be cit$ z ! ,sy/emic ,risk ,mitigation ,act4 #b4 ,def9itions ,9 ?is ,act3 7#a7 ,av]age daily clos+ price 7,a7 ,9 g5]al ,! t]m av]age daily clos+ price means ! av]age daily clos+ price ( a cr$it default swap on long-t]m subord9at$ debt ( a bank hold+ company dur+ a #cj-;day p]iod4 7,b7 ,regulations ,! ,bo>d1 ?r\gh regulations1 %all develop a me?od to det]m9e ! daily clos+ price ( a cr$it default swap on long-t]m subord9at$ debt ( a bank hold+ company & %all calculate ! av]age daily clos+ price accord+ly4 7#b7 ,bank hold+ company ,! t]m bank hold+ company has ! same mean+ giv5 su* t]m 9 section #b ( ! ,bank ,hold+ ,company ,act ( #aief 7#ab ,u4,s4,c4 #ahda71 b %all only include su* companies ) total consolidat$ assets great] ?an or equal to #ej1jjj1jjj1jjj4 7#c7 ,bo>d ,! t]m ,bo>d means ! ,bo>d ( ,gov]nors ( ! ,f$]al ,res]ve ,sy/em4 7#d7 ,cr$it default swap ,! t]m cr$it default swap has ! same mean+ giv5 ! t]m swap agreem5t 9 section #bjf;,a ( ! ,gramm-,lea*-,bliley ,act 7#ae ,u4,s4,c4 #gh;c nt74 7#e7 ,long-t]m subord9at$ debt ,! t]m long-t]m subord9at$ debt means unsecur$ bonds or o!r debt in/rum5ts issu$ by a bank hold+ company t-- 7,a7 is subord9at$ to ! claims ( depositors or g5]al cr$itors2 & 7,b7 has a maturity date n less ?an #e ye>s4 7#f7 ,/ress te/ 7,a7 ,9 g5]al ,! t]m /ress te/ means an evaluation design$ by ! ,bo>d to det]m9e :e!r a bank hold+ company-- 7i7 has ! capital1 on a total consolidat$ basis1 necess>y to absorb losses z a result ( adv]se economic conditions2 & 7ii7 is suffici5tly capitaliz$ to meet sy/emically important obligations4 7,b7 ,regulations ,! t]m sy/emically important obligation %all be def9$ 9 regulations prescrib$ by ! ,bo>d4 7#g7 ,ti] #a capital ,! t]m ti] #a capital has ! same mean+ giv5 9 "p #bbe ( title #ab1 ,code ( ,f$]al ,regulations1 z 9 effect on ! date ( enactm5t ( ?is ,act1 or any successor !reto4 #c4 ,m>ket-bas$ trigg] to det]m9e adequacy ( capital 7a7 ,m>ket-,bas$ trigg] 7#a7 ,great] ?an #ej basis po9ts 7,a7 ,9 g5]al ,9 ! case t ! av]age daily clos+ price exce$s #ej basis po9ts-- 7i7 ! ,bo>d %all notify ! bank hold+ company t x ne$s to raise additional ti] #a capital 9 ord] to r$uce su* clos+ price bel[ #ej basis po9ts2 7ii7 n lat] ?an #ad days 7or less if ! ,bo>d makes a det]m9ation t conditions w>rant a %ort] p]iod ( "t7 aft] su* notification "u clause 7i71 su* company %all submit to ! ,bo>d an action plan detail+ h[ ! company int5ds on rem$iat+ its capital defici5cy2 7iii7 su* company has #cj days to implem5t ! plan submitt$ "u clause 7ii7 aft] su* plan is approv$ by ! ,bo>d2 & 7iv7 if aft] ! end ( ! #cj-;day p]iod describ$ 9 clause 7iii7 ! av]age daily clos+ price exce$s #ej basis po9ts1 ! ,bo>d & su* company %all repeat clause 7i7 ?r\gh 7iii7 until su* clos+ price is less ?an or equal to #ej basis po9ts4 7,b7 ,appeal 7i7 ,9 g5]al ,a bank hold+ company may appeal ! f9d+s ( ! ,bo>d "u subp>agraph 7,a7 & reque/ t ! ,bo>d conduct a /ress te/4 7ii7 ,toll+ ,an appeal made pursuant to clause 7i7 %all toll any deadl9e specifi$ "u subp>agraph 7,a7 until ! conclusion ( ! appeals process4 7iii7 ,capital defici5cy ,if ! ,bo>d det]m9es1 aft] conduct+ a /ress te/ pursuant to clause 7i71 t ! bank hold+ company has a capital defici5cy1 ! ,bo>d & ! bank hold+ company %all repeat clause 7i7 ?r\gh 7iii7 ( subp>agraph 7,a7 9 accordance ) clause 7iv7 ( su* subp>agraph4 7#b7 ,great] ?an #ge basis po9ts ,9 ! case t ! av]age daily clos+ price exce$s #ge basis po9ts-- 7,a7 ! ,bo>d %all notify ! bank hold+ company 9 accordance ) clause 7i7 ( p>agraph 7#a77;,a72 7,b7 su* company %all submit & implem5t an action plan 9 accordance ) clause 7ii7 & 7iii7 ( p>agraph 7#a77;,a72 7,c7 ! ,bo>d may susp5d or limit divid5ds paid by ! bank hold+ company until su* company's av]age daily clos+ price is less ?an or equal to #ej basis po9ts2 7,d7 ! ,bo>d %all notify ! company t x w be plac$ into receiv]%ip 9 accordance ) p>agraph 7#c7 if ! av]age daily clos+ price exce$s #ajj basis po9ts2 7,e7 ! ,bo>d %all conduct a /ress te/2 & 7,f7 if ! ,bo>d det]m9es1 aft] conduct+ a /ress te/ pursuant to subp>agraph 7,e71 t su* company has a capital defici5cy1 n lat] ?an #ad days 7or less if ! ,bo>d makes a det]m9ation t conditions w>rant a %ort] p]iod ( "t7 aft] su* /ress te/ is complet$1 su* company %all submit & implem5t an action plan 9 accordance ) clause 7ii7 & 7iii7 ( p>agraph 7#a77;,a74 7#c7 ,great] ?an #ajj basis po9ts ,9 ! case t ! av]age daily clos+ price exce$s #ajj basis po9ts1 ! ,bo>d %all place ! company into receiv]%ip 9 accordance ) ! ord]ly liquidation au?ority provid$ "u title ,,ii ( ! ,dodd-,frank ,wall ,/reet ,re=m & ,consum] ,protection ,act 7#ab ,u4,s4,c4 #echa et seq474 7b7 ,failure ,to submit action plan ,a failure by a bank hold+ company to submit an action plan pursuant to subsection 7a7 )9 ! "t p]iod requir$ "u su* subsection %all result 9 ! ,bo>d plac+ su* company into receiv]%ip z describ$ 9 subsection 7a77#c74 7c7 ,limitation on claims = hold]s ( long-,t]m subord9at$ debt ,any entity t is a hold] ( long-t]m subord9at$ debt ( a bank hold+ company t has be5 plac$ into receiv]%ip pursuant to ?is section %all receive ! less] (-- 7#a7 #hj p]c5t ( ! face value ( su* debt2 or 7#b7 ! residual value ( su* company aft] all o!r claims ( o!r cr$itors h be5 satisfi$4 7d7 ,subord9at$ debt requirem5t 7#a7 ,9 g5]al ,! ,bo>d %all require ea* bank hold+ company to issue & ma9ta9 long-t]m subord9at$ debt 9 an am\nt great] ?an or equal to #ae p]c5t ( ! total consolidat$ assets ( su* company4 7#b7 ,deadl9e ,a bank hold+ company %all meet ! requirem5t set =? 9 p>agraph 7#a7 no lat] ?an ! effective date ( ?is section4 7#c7 ,failure to meet requirem5t ,if a bank hold+ company fails to meet ! requirem5t set =? 9 p>agraph 7#a71 su* company %all submit a plan to ! ,bo>d describ+ ! /eps ! company w take to meet su* requirem5t4 7e7 ,effective date ,?is section %all take effect #b ye>s aft] ! date ( ! enactm5t ( ?is ,act4 #d4 ,repeal 7a7 ,prohibitions on propriet>y trad+ ,section #ac ( ! ,bank ,hold+ ,company ,act ( #aief 7#ab ,u4,s4,c4 #ahea7 is repeal$4 7b7 ,enhanc$ ,prud5tial ,/&>ds ,section #afe ( ! ,dodd-,frank ,wall ,/reet ,re=m & ,consum] ,protection ,act 7#ab ,u4,s4,c4 #ecfe7 is repeal$4