Large Bank Supervision Forum 2023

02. Regulatory Oversight and History

For financial professional or qualified institutional investor use only. Not for inspection by, distribution or quotation to the general public.

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Regulatory Milestones and Consequential Bank Regulation

1980’s High Yield Bond volume peaked to support LBO activity. Syndicated Loan Market Emerges. First retail Mutual Fund

2010 – Today. Mature Asset Class. Evolution and Growth of Primary and Secondary Markets  Efficiency and Liquidity, Transparency and Reporting. Enhanced Portfolio Management. Disruption from pandemic and monetary policy moves. Market has adjusted to elements of the Dodd Frank Act

2000’s “Loan Traders”

1990’s Loan Syndication and Trading Association (LSTA) formed. Ratings and coverage begin. “B” or Institutional Term Loans popularized. Secondary market, CLOs, 2 nd lien loans and securitization emerge.

emerge and LSTA S&P Index supports efficient trading of higher volumes . Growth of Enterprise Value in bankruptcy. Global growth

1977 Interagency Shared National Credit (SNC) Program Established. REGULATION INNOVATION

2001 OCC Bulletin 2001-18 “Leveraged Financing– Sound Risk Management Practices”

2010 The Dodd Frank Wall Street Reform and Consumer Protection Act and revisions

1981* OCC Bankng Circular 181, Purchase of Loans in Whole or In Part Participations.

2008 OCC

1988 Examining Circular 245, “Highly Leveraged Transactions” published.

2013-14 2013

2020 OCC Bulletin 2020-81 Credit Risk Management of Loan

Publishes Leveraged Lending – Comptrollers Handbook

Interagency Guidance on Leveraged Lending and 2014 FAQ for Implementing the Guidance.

Purchase Activities

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*Revised 10-30-2013