SEC Proposal Would Shield Foreign Bank Rescue Tools From US Enforcement
Investors holding securities issued by foreign regulators to stabilize at-risk lenders may be exempt from US securities laws. SEC Chairman Paul Atkins has proposed a rule creating a carve-out for these instruments. The proposal targets securities issued during stabilization efforts by foreign banking regulators. This includes the 'bail-in' powers adopted by the Bank of England after the 2008 financial crisis. The SEC has already granted a request to avoid enforcement action over unregistered securities when a lender acting at the direction of the Bank of England exchanges bail-in securities.
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