H. R. 1165
IN THE HOUSE OF REPRESENTATIVES
February 27, 2015
Mr. Capuano introduced the following bill; which was referred to the Committee on Financial Services
To direct the Securities and Exchange Commission to require that repurchase-to-maturity transactions be treated as secured borrowings.
This Act may be cited as the
Keep Repos to Maturity on Balance Sheet Act of 2015.
Accounting treatment of RTM transactions
In establishing accounting principles or standards for purposes of the securities laws, the Securities and Exchange Commission shall require that a repurchase-to-maturity transaction be treated as a secured borrowing in which the transferred asset serves as collateral.
In this section:
repurchase-to-maturity transaction means a transaction in which—
a financial asset is transferred in exchange for cash, other financial assets, or letters of credit; and
concurrently with the transfer, the transferor and the transferee agree that, at the maturity of the transferred asset, the transferee may either, at the option of the transferee—
return the transferred asset (or a substantially similar asset) to the transferor, thereby obligating the transferor to reacquire the transferred asset (or to acquire the substantially similar asset, as the case may be) for an amount equal to the value of the cash, other financial assets, or letters of credit described in subparagraph (A), plus a stipulated interest factor; or
redeem the transferred asset from the issuer of the transferred asset.
securities laws has the meaning given such term in section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)).
transferred asset means a financial asset transferred in exchange for cash, other financial assets, or letters of credit in a repurchase-to-maturity transaction, as described in paragraph (1)(A).
The treatment required under subsection (a) shall apply beginning on the date that is 90 days after the date of the enactment of this Act.