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FLOW what is going on pard? I cant get my brain of the trusts 99 plus 1.
So how does it flow through in your? Thoughts? Az has pretty much solidified my thinking. I was wondering your thoughts.
NewFlow regards,
B
As Az and others have shown it can be clearly seen that the dual tracking in the DC. courts is really where our interest should be.
It can be seen clearly why those trusts are of the major interest to all because they are property now of wmi III and in my opinion hence the fuel for wmih's intentions,as well as, all the hedgies and institutional investors...
I am begining to see more clearly why they are here....the dog and pony show with finding suitor is really a back seat to the 1st part Return of proceeds and principal to WMI III estate.....
Trust Regards,
B
Peyton,
Again you cannot treat this stock like others ! Also I would see Az cowboy's post on conversion event.
Redemption/ Replacement Capital Covenant/ Intentions of WMI and the
Company General.
On each day on which the Company redeems
Series 2007- B Company Preferred Securities, the Trust will
apply the redemption proceeds
it receives on the
Series 2007- B Company Preferred Securities to redeem a like
amount of Trust Securities. The redemption provisions of the
Series 2007- B Company Preferred Securities are described
below. Subject to a covenant in
effect until October 25, 2017,
in favor of certain of WMI’s debtholders limiting WMI’s and its’
subsidiaries’ right to purchase or redeem the Series 2007- B
Company Preferred Securities or the Trust Securities (among
others), as described in the next paragraph, and subject to
the Company having received the prior approval of the OTS
for any proposed redemption of Series 2007- B Company Preferred Securities, the Company may, at its option, redeem the Series 2007- B Company Preferred Securities:
•in whole but not in part, on any Dividend Payment Date prior to the Dividend Payment Date in December 2017 upon the occurrence of a Tax Event, an Investment Company Act
Event, a Rating Agency Event or a Regulatory Capital Event, at a cash redemption price equal to the sum of: ( i) the greater of: (A)$1,000 per Series 2007- B Company Preferred Security, or (B)the sum of the present values of $1,000 per
Series 2007-B Company Preferred Security, discounted from the Dividend Payment Date
In December 2017
to the redemption date, and the present values of all undeclared dividends for each Dividend Period from the redemption date to and including the Dividend Payment Date in December 2017, discounted from their applicable Dividend Payment Dates to the redemption date on a quarterly basis, in each case (assuming a 360-day year consisting of twelve
30-day months) at the Treasury Rate,
Having investigated the WaMu/FDIC/Chase fact pattern for nearly seven-years now, and having investigated hundreds of foreclosure cases where JPMorgan Chase claims sole ownership of specific Washington Mutual Bank loans by virtue of the “Purchase & Assumption Agreement” (PAA) with the FDIC, one fact is now well established – no schedule or inventory of assets listing any specific WMB mortgage loan acquired by JPMC exists, or has ever been produced or disclosed. The reason for this fact is that the vast majority of residential mortgage loans were securitized through WaMu’s “Off-Balance Sheet Activities,” meaning WMB sold their loans prior to the FDIC Receivership.
http://bpinvestigativeagency.com/wp-content/uploads/2016/08/Asset-Trusts-Offering-Circular.pdf
These trusts were set-up as Delaware Statutory Trusts with REMIC status. In virtually all PSA agreements for DST’s that are visible, to which the DST’s are irrevocable and elect REMIC status, they are required to maintain complete separateness from any other person or entity. Chase’s naming of these trusts as subsidiaries certainly smells “fishy.” At best, Chase acquired servicing rights to these loans, but even this should not be assumed. How a servicer can take control of a REMIC Trust and claim it as a subsidiary on its 10-K is beyond me, but I’d sure like to see the documentation granting this authority.
In the meantime, someone explain to me how tens of thousands of foreclosures have been conducted in the names of private MBS REMIC trusts since the crash in 2008, and not one foreclosure appears to have occurred within this toxic group of 67,529 loans in the name of Deutsche Bank as Trustee for these trusts. The odds are virtually impossible.
This is very interesting given the timing
Backing it up regards,
B
As J today said in her email.
"It is anticipated that additional information will be posted in the near future.
What that means is exactly what was stated anticipated info in the near future" and just that. Any more and we all read into it and becomes subjective.
"Thank you again for your kind words, and for being so understanding. I know that this has not been a pleasant process for you"
This I believe says only to The Process being unpleasant subjectively I hope for a pleasant outcome ....
Fast forward to the 29th of Sept and a few days if we are going for 18 fiscal year...
Moving on regards,
B
A Strategic decision of Two counts for informational purposes only.
IN NO WAY IS THIS POST OR THE INFO CONTAINED Herein should be taken as a basis for, construed, acted upon, engage in any financial transaction, trade, transfer, or convey or cause to be used as is or for any financial decision. The information in this post is for informational purposes only. It should not be considered, determined, disseminated as, or construed as legal or financial advice, or a recommendation there of: You should consult with an attorney or other professional in making any decisions
1. Yesterday after contacted a public contact for the FDIC as circumstances have shown there was calls for contact by many to a public contact I. Out of respect for as a public official and transparency I included this public contact point of communication info. In doing so I circumstances have or may feel the initiative to do so as well. With more and more calls to do so, I decided, of sound mind and character, to act on my own behalf and for my benefit only, and in no way for influence of anyone or anything. A day after I made the 2nd decision too....
2. Follow my call with a sincere and honest email. Strategically I knew the contact would eventually be contacted and the contact would then probably dry up as a point of public contact. So I sent It! This email stated that my contact treated me as a person, a citizen, me a little fish. I communicated how much this meant to me A "little fish swimming with whales. I spoke of my personal journey following the bk thru the lengthy journey of the courts. I conveyed the hope or possibility I may see back some of the hard-earned dollars and time invested.
I communicated as hard working American citizen I hoped my, common stock, preferred and bonds may see a return thru both the old co and the reorganized debtor. I then stated sincere appreciation and dignity she brought to her dealings with respect to my inquiry and the manner had dealt with me.
This is a public contact reply to my email. I have decided to share this as a member of a public forum that shares in a discussion place of free speech and ideas gathering PUBLIC information of personal importance. I do so only on a public forum so I myself, may start a discussion to further MY understanding of “THE PROCESS”
Hi Barry, and thank you very much for your email. You are very kind. I do wish that I had additional information to provide to you regarding the Washington Mutual Bank Receivership. As I stated, there is a great deal of analysis and many discussions underway. The moment the decisions are made and additional information is available to share, the details will be placed on the Receivership website. For the most up-to-date information regarding the Receivership, please visit: https://www.fdic.gov/bank/individual/failed/wamu.html. It is anticipated that additional information will be posted in the near future. Thank you again for your kind words, and for being so understanding. I know that this has not been a pleasant process for you…
J………
Federal Deposit Insurance Corporation
Receivership Operations
"Our lives begin to end the day we become silent about things that matter."- Martin Luther
441.49k traded and it ends even. Ok now that is over....
AZ,
The gratitude goes to you kind sir for all the light you have shined upon this case through your amazing D.D. and sharing of such. Whether we win,loose,or draw the effort and precise communication of your work is truly admirable. The more I have researched your and a few others D.D. it is amazing the size of the mortgage holdings, trusts and the billions they hold and yes as I think we will find the interest that has accumulated.
As I replied to Bluzie I think all should relax and have patience as the show is soon to start and the curtain will quietly and slowly begin to open to little or no fan fare.
Az regards,
B
Bluzie,
I have been in sales, management and ran two successful small bsn's. I have learned a few things along the way. One of these being, when given access to that which is usually not accessible RESPECT what was given and use it wisely!
I have no intentions of calling her back in anyway shape or form until the 29th of Sept And I will only do so if we do not see a status update.
I have no intentions as some have asked to try to get stock or bond payment info from her. First she is probably not privy to that info and second time will tell soon enough. To barrage this kind soul with specific questions would be A. disrespectful and B. would probably turn the contact sour.
I think it is wise to treat this contact with respect and keep the question for now related to timeline. I for sure will not become The "VERUCA SALT" on the phone. To be honest I hesitated even posting the outcome of the call on this board for fear she may catch some heat for the release of information.
REMEMBER SHE DID NOT STATE OR DIVULGE WHAT THE STATUS UPDATE IS OR WILL CONTAIN. What she confirmed is the case is moving on the time line the heavy lifting board contributors have stated were critical dates and deadlines.
Please respect her kindness.
Respect regards,
B
FDIC JANICE JOHNNY BE COOL
So after having a great day yesterday my only thought now is for everyone to BE COOL on the contact. Yes she is real! Yes she was forth coming with information! Yes she was very helpful! However, NO I do not think it wise to have everyone blow up the phone and hound her. I feel it was a blessing she gave me what she did. So on my best advice I will save that next call for the 29th of Sept. Until then I will leave it alone. She was so nice, so cool, and so helpful to many I do not want to burn her in any way. Lets be content for now with the calm and collaboration she has brought to us and the confirmation she has given to Ron's,Az's and others timeline and THE PROCESS!
Thanks for all the kind words. I am just a little fish doing my part who swims with whales.
Be cool regards,
B
DENNY,
Your welcome just my little bit.. Sure does make AZCoWboys D.D. look spot on ;)
Thanks regards,
B
Big,
I hear you and agree. I know one thing is for sure I gonna get lynched if they put something out that is not good for us. Keep my fingers crossed.
Big Bang regards,
B
Nhtrader,
I called and spoke with Janice at the R&R division see my post Gobsmacked in bold.
regards,
B
Lucky
Lucky Panda first you and others deserve the big thanks for your years of service and hard work. I read all your posts and you are well spoken and level headed. You have a very keen intellect! Your contributions are big here!
I agree! Although we have not yet seen what is behind the curtain or release. I guess as to say for sure it's what we want to hear. B
However Janice was overtly kind and maybe she is just a sweetheart, but who takes the time in her position to say we are working a hard and that hopefully next week we will have the staus update completed? Then the whole large servicing thing out of Florida due to the Hurricane ..that also has me wondering is that like a Mortgage servicing Co? Perfecting or updating lien holders or what ?
Lucky Panda regards,
B
stoxjock,
Your welcome. All I can say it brings forth the realization that yes this case is now rolling forward and Janice was The God send today. Texas sweetheart but when she said she sat on the team resolving it than that's when I knew I struck pay dirt. Nicest Texas lady on the phone you could have talked to. I was looking for the oh crap feeling as she either shut me down or made me feel like I was wasting my time with the case. As I told her I was just a small investor looking for information as in recovery. Right there and then she coul have said something really negative but instead say she alludes to understanding how frustrated must be in not getting any answers.
I mean who knows but it could be alot of things the say in the upcoming release but one thing for sure is this baby is wrapping up to some degree....at least that is what she lead me to believe with the caveat of you can always have a glitch.. but still positive i would say .
Regards,
B
Big did you read what I said! Janice stated an update on the status is forth coming! That is big news to me. Janice sits on that team resolving the bank. I think it is huge news given the recent filings and due diligence put for by a namely few ...it collaborates the timeline. Now it could be a bad update it could be a good update ,however given what Az and others including my own D.D. I would disagree its a waste of time. If I were betting man reading the tone and demeanor of Janice they are pushing hard to wrap this pup up! Gut says its good.
Time well spent regards,
B
Now the hard years of work of Az and the 10 -15 others I see is looking all the more real! Not that I doubted Az at all! It collaborates his work.
It just looks like he nailed the time line...Frigging Nailed it. And to what degree... perfect.
So if you are short or long take to the bank what I said. It could be good news for some and bad for others however its good info for all.. period.
Info regards,
B
JUST Do my little part on a journey together if I can lighten the load for some than I would do it now and forever. ! Just doing my little bit there are some power houses around here that are meat eater operators compared to my bit. Those are the people whom have done the heaviest of lifting for years ! That's who I tip my hat to.
Little lift regards,
B
Stop the presses Continued. I thanked her for her time and she said call back if I had any other questions. She said I know how you must feel about not being able to get answers but very soon and hopefully next week you will get the updates you will be looking for. She says they will be posted on the receivership web page for Washington Metal’s Receivership page!
I am a was raised in a hard- working farm family from the Midwest. My father was a Special Weapons instructor who was invited by Presidential invite to dedicate the Airman monument in D.C. My mother a artist and author recognized nationally. Why am I telling you this because I understand the gravity of this situation to all here both short and long and I fault no one for their positions as long as they are honest. I have honor and I will stand by these words so help me God. To the very best of my ability that is exactly what she said.
Farm Kid regards,
B
Continued because I was so GOBSMACKED I fricking cant hit the right Keys!
While trying to get through to someone I became impatient and called Assistant Director
Institution & Asset Sales
Owned Real Estate
Dan Walker (972) 761-2215
Dan was super nice he asked who I told him and he said he was not involved in the case because there were no asset sales. I said how do you figure. he said because it was a whole bank transfer and that no assets were sold. I said well, where are they? Dan said all I can tell you is there were no asset sales as far as I would be involved.
I said so are they with the receiver? Dan said well they could be. I think he was alluding to the branches and physical assets. He said who you really need to call is a busman as the deal with public inquiries. I said that you and he provided me with another number. I called and just as a general help person answered my phone lit up with Janice's number. I said quickly I had to go and answered
Wow difference between night and day. Janice called and was very polite after I introduced myself as a little fish investor who has been following the case because of money that was hard earned invested. I said that I was following the progression in the case and with the JPMC/DB settlement now complete I was hoping that the case was going to move toward completion. What Janice said next sat me on my behind. " She said I sit on the resolution team and we are working very hard right now to wrap up all the loose ends". She said we are were delayed in updating the R&R status because we are working with a large servicer in FL and the hurricane set us back due to interupption of the hurricane. Then then said we are looking to update the status on the recievership page of the Fdic's recievership page next week hopely. She said I hate to give a drop dead date as glitches occur in the final process sometimes however we believe next week the stautus will be updated! She said I really cannot say much more that that but should you have another question I will try to answer it if I can.
I
Continued because I was so GOBSMACKED I fricking cant hit the right Keys!
While trying to get through to someone I became impatient and called Assistant Director
Institution & Asset Sales
Owned Real Estate
Dan Walker (972) 761-2215
Dan was super nice he asked who I told him and he said he was not involved in the case because there were no asset sales. I said how do you figure. he said because it was a whole bank transfer and that no assets were sold. I said well, where are they? Dan said all I can tell you is there were no asset sales as far as I would be involved.
I said so are they with the receiver? Dan said well they could be. I think he was alluding to the branches and physical assets. He said who you really need to call is a busman as the deal with public inquiries. I said that you and he provided me with another number. I called and just as a general help person answered my phone lit up with Janice's number. I said quickly I had to go and answered
Wow difference between night and day. Janice called and was very polite after I introduced myself as a little fish investor who has been following the case because of money that was hard earned invested. I said that I was following the progression in the case and with the JPMC/DB settlement now complete I was hoping that the case was going to move toward completion. What Janice said next sat me on my behind. " She said I sit on the resolution team and we are working very hard right now to wrap up all the loose ends". She said we are were delayed in updating the R&R status because we are working with a large servicer in FL and the hurricane set us back due to interupption of the hurricane. Then then said we are looking to update the status on the recievership page of the Fdic's recievership page next week hopely. She said I hate to give a drop dead date as glitches occur in the final process sometimes however we believe next week the stautus will be updated! She said I really cannot say much more that that but should you have another question I will try to answer it if I can.
I
STOP THE PRESSES! Janic Hearn Just called Back!
Aaron,
That is not what I said. Please go back and read my post. Some one else may call and get the same answer or a different one. I am just stating what was said. I did not say that they said no payments or money. I also may add that after about 30 sec in the call I was put on speaker. I DO NOT KNOW WHY OR CARE.
My gut tells me that these folks will say only what they can or are privy to. This whole matter is not of panic worry or joking. It is dead serious to me. Furthermore with the secrecy that surrounds this case, those at the lower echelons probably are not close enough to the pulse or have access to how the Chit is gonna go down.
I would suggest a trusted board member here call and see what they are told. I did call back to speak with the
Assistant Director
Claims Administration
(Operations)
Janice Hearn (972) 761- 8635
and left message asking her to return my call. We will see if I can get anymore clarity.
Call regards,
B
So I called this number and 888-206-4662 Spoke with a Mathew and inquired to the status of the Wamu recievership.He stated that it was in process and that I was welcome to call back in the near future . I pressed him and asked him if we were close to the finalization and was it to close this year. He stated "NO". I asked are we months years out still he said "not years". I said so how is it progressing now that the JpMC D Bank settlement has occurred. He said things are progressing and I will transfer you to the Claims group for more information. He transferred me and I went to voice mail and left a message for them to call me back.
My call was routed to Dallas.
Here are some contacts
Division of Resolutions and Receiverships (Dallas)
Deputy Director
Receivership Operations
Randy Taylor (972) 761-8555 Deputy Director
Business Operations Support
David Cooley (972) 761-8638
Associate Director
Receivership Operations
Frank Campagna (972) 761-8025 Assistant Director
Investigations
Connie Dryden (972) 761-2201
Assistant Director
Institution & Asset Sales
Owned Real Estate
Dan Walker (972) 761-2215 Assistant Director
Claims Administration
(Operations)
Janice Hearn (972) 761- 8635
Assistant Director
Institution & Asset Sales
Asset Management
VACANT Assistant Director
Contract Oversight
Wes Kilmer (972) 761-2579
Assistant Director
Institution & Asset Sales
Asset Marketing
Richard Salmon (972) 761-8208 Assistant Director
Receivership Administration and
Strategic Operations
Andrew Stirling (972) 761-2813
Manager
Internal Review
David Tedesco (972) 761-2221 Regional Manager (Dallas)
Michael Houston (972) 761-8204
Good job for reaching out!
Getting back up to speed via doc review and my own due diligence it is abundantly clear WMB deposit base and foot print was essentially purchase. The remainder some which was legally isolated or put in trusts was not or would be never be accessible period. If you were the GOV because of greed, lawyers, old and new money this still requires THE PROCESS.
As big as the financial crisis was the old saying "do not waste a crisis" came to play.
After going back over the reports form the OTS, OIG, FDIC, Subcommittee HLS and on and on… I most definitely would have to agree with the work of AZ, LP, LG,HM,RD,CBA,FWHZ,NF, and lodas on the stock trading mechanics …and so many more.
I said I was getting back up to speed. When I left to raise my two beautiful children the only 5 years ago the only thing that kept me connected was my H payments periodically. I truly can deduct from these board contributors that thru my research I do believe, and can see that this is a massive iceberg which we have only seen the tip of.
Ask yourself one question where did all the assets go? Who has shown them on their books and what is still behind the curtain...
Hat tip to all the hard working contributors of this board! Win lose or draw you my friends are an admirable group of individuals helping those who care to take heed. Like sunlight to the soil and a seed planted beneath the earth’s surface; both in the end spring to a life and rose with faith of a mustard seed.
The seed that lays below this ground when rising you can be proud of the many lives and pockets I feel will be enriched by your RELENTLESS EFFORT.
The majority of the assets are soon to be forth coming ... Just read the sign posts ...it gets clearer by the day.
Hat tip Regards,
Bw
Lodas,
You are to kind. I as you, thought it was of a good willed nature about sharing the journey. Rather just sense or a reflection on the better nature that resides in our souls on this journey of life.
Oh well thank you for your kind words. And some one around here abhors the light of good will.
Goodwill regards,
B
Trying to see if it applies anywhere. C
Federal Register Treatment of Certain Collateralized Debt Obligations Backed Primarily by Trust Preferred Securities; Prohibitions and Restrictions on Certain Interests in Hedge Funds and Private Equity Funds (3064-AE11)
The Office of the Comptroller of the Currency, the Federal Reserve Board, the Federal Deposit Insurance Corporation, the U.S. Commodity Futures Trading Commission, and the Securities Exchange Commission (individually, an Agency, and collectively, the Agencies) will be adopting an interim final rule that would permit banking entities to retain investments in certain pooled investment vehicles that invested their offering proceeds primarily in trust preferred or subordinated debt securities issued by community banking organizations of the type grandfathered under section 171 of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The interim final rule is a companion rule to the final rules adopted by the Agencies to implement section 13 of the Bank Holding Company Act of 1956, which was added by section 619 of the Dodd-Frank Act.
Get off AZ's work.
I suggest those who are calling into question his Research and D.D. to ignore it and go do the massive under taking he has. Do not complain! Go do your own. I bet most of those whining would not last 24hrs learning the complex world of CHAP 11 bk LAW.
You all ought to be thankful he is sharing what he has learned and then compare that against what you have learned and research....in which this message board is the extent of your research.
Az Cowboy regards,
B
Nothing In TD Ameri has changed ?
AZ BBAN Thanks for the quick review . It is all making more sense now that yourself and a few others have done the hefty lifting.
Know what you Own. I have a PKQ's marker shares and new co commons. Still freaks me out a little that I might have missed a better mix.
Thanks again gentleman!
Big regards,
B
Bob,
Yeah I here ya pard, I have some pretty solid convictions but I am with you and the Denke 24b...range! Dam sure would be nice! One way or another soon it will all be revealed...hopefully sooner rather than latter.
Thanks BBANBOB
Regards,
B
Under the NIC's statement of what is on the block madison Lane is all I could find and no relation. So I tend to agree a non event for us.
Agreement regards,
B
AZ Cowboy,
If you get the chance am I thinking correctly WaMu Mortgage Securities Corp.
Thanks regards,
B
AS per the settlement JPMC DB
https://www.law360.com/articles/830819/jpmorgan-to-get-645m-from-fdic-over-wamu-purchase
Under the terms of Friday’s announced settlement, JPMorgan will collect its $645 million from the Washington Mutual Bank receivership estate overseen by FDIC
Washington mutual securities corp.
Please forgive me if this has been already decided as I have a lot on in life and its hard to keep it all clear with the small amount of time I have.
Ok so as per the JPMC DB settlement of 645 from the last filing how does this all flow out? So now that JPMC DB settles am I correct in my thinking that this then flows out down the river and over the fall?
https://www.bamsec.com/filing/92963817000686/2?cik=314643
Total Assets in ABS by Originator
61,528,965,561
Demand in Dispute (3)(8
58,228,668,58
Regards,
B
Rule 360 Safe Harbor Post WAMU
FDIC Securitization Rule FDIC POST WAMU
The way I see it is there is a AWHOLELOTAA Assets that got protected and under even the new law some very big ones still would be untouchable. REMEMBER KILLINGER&FISHMAN/ MANAGEMENT KNEW THEY WERE GOING TO GET ROLLED! The truth is most of the assets were all safe harbored or off Books long before.
New York Washington, D.C. Los Angeles Palo Alto London Paris Frankfurt
Tokyo Hong Kong Beijing Melbourne Sydney
www.sullcrom.com
May 21, 2010
FDIC Securitization Rule
FDIC Proposes Revised Securitization Rule Including Safe Harbors for
Securitization Transactions Not Entitled to Off Balance Sheet
Treatment under New Accounting Standards
SUMMARY
On May 11, 2010, the Federal Deposit Insurance Corporation issued a Notice of Proposed Rulemaking to
address the safe harbor protection in a receivership or conservatorship for financial assets transferred by
an insured depository institution in connection with a securitization or participation after September 30,
2010. This action was prompted by the changes adopted by the Financial Accounting Standards Board in
June 2009 to the accounting standards on which the FDIC’s existing Rule 360.6 is based and builds on a
draft rule presented by the FDIC in an Advance Notice of Proposed Rulemaking issued for public
comment in December 2009. The FDIC is seeking comment on the proposals on or before July 1, 2010.
Similar to existing FDIC Rule 360.6, the proposed rule would protect securitizations made after
September 30, 2010 from repudiation by the FDIC as receiver or conservator if the transfer of financial
assets under the securitization qualifies for sale accounting treatment under generally accepted
accounting principles as in effect for reporting periods beginning after November 15, 2009, except for the
“legal isolation” condition that is addressed by the rule, but the proposed rule would impose substantial
additional conditions that all securitizations must meet to benefit from safe harbor protections after a
grandfathering period ending on September 30, 2010.
The safe harbor raises the issue of the disposition of a participation that does not appear
to fall within the express terms of the rules, for example, because of elements of recourse in the
transfer. [color=red]The discussion of the rules by the FDIC in the Federal Register releases accompanying
adoption of the rules supports the view that other transfers would be safe from potential
repudiation It states that: “If the available evidence provides reasonable assurance that the
transferred assets would be beyond the reach of the powers of a bankruptcy trustee or receiver
for the transferor, then a determination that the transferred assets have been legally isolated
[from the receiver] is appropriate.” 65 Fed. Reg. at 49189.
With these statements as a predicate, the FDIC preamble further provides:
[A] transaction that purports to be a sale (not a participation) of all of a financial
asset, even if it includes recourse against the seller, which would be characterized
as a sale under the general legal view, should not need to be encompassed by the
rule; the FDIC would not be able to recover transferred assets as a result of
repudiation. In the case of a completed sale, the FDIC would have nothing to
repudiate if no further performance is required. Even in the case of a sale
transaction that imposes some continuing obligation, a repudiation by the FDIC
would relieve the FDIC from future performance, but generally should not result
in a recovery of any property that was transferred by the institution before the
appointment of the conservator or receiver[/color]
Safe Harbor legal Isolation 2008 rules
a. Safe Harbor
The goal of the FDIC in addressing the legal isolation concern was succinctly
stated by the FDIC’s General Counsel in Financial Institution Letters issued in conjunction with
the proposed rule and the final rule as adopted:
If the transferred assets [in a securitization or loan participation] are not
sufficiently isolated from the insured bank or thrift, its creditors or the receiver,
the transfers would not qualify for sale treatment under GAAP and the transferred
assets would continue to be reported as assets on the [transferor] institution’s
balance sheet.
The rule responds to those questions by reassuring interested parties that, subject
to certain conditions such as fraud, the FDIC - as conservator or receiver - will not
seek to reclaim, recover or recharacterize as property of the institution or the
receivership financial assets transferred by the institution in connection with a
securitization or participation. Accordingly, the rule should resolve the legal
isolation issue for insured depository institutions. The rule confirms existing
FDIC practice in dealing with securitization and participation transactions.28
With respect to the legal isolation issue, the rule provides a safe harbor determination for
transactions that fall within its terms.29 The FDIC rule states:
(b) The FDIC shall not, by exercise of its authority to disaffirm or repudiate
contracts under 12 U.S.C. 1821(e), reclaim, recover, or recharacterize as property
of the institution or the receivership any financial assets transferred by an insured
depository institution in connection with a securitization or participation, provided
that such transfer meets all conditions for sale accounting treatment under
generally accepted accounting principles, other than the “legal isolation”
condition as it applies to institutions for which the FDIC may be appointed as
conservator or receiver, which is addressed by this section.
Lodas,
Speaking the trading truth! When it breaks they are going to get rolled with afterburners.