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SEC Adopts Pay Ratio Rule

October 13, 2015

Authors

Bryan Cave

SEC Adopts Pay Ratio Rule

October 13, 2015

by: Bryan Cave

On August 5, 2015, in a 3-2 vote, the SEC adopted the rule implementing the controversial pay ratio requirement pursuant to the Dodd-Frank Act. The rule requires companies to disclose:

  • the median of the annual total compensation of all employees, excluding the principal executive officer, or CEO;
  • the annual total compensation of the CEO (which is already required to be disclosed); and
  • the ratio of  these two amounts.

The new rule applies to companies required to provide executive compensation disclosure under Item 402(c)(2)(x) of Regulation S-K in proxy statements or annual reports on Form 10-K, as well as registration statements or other filings. Most companies are required to report the pay ratio disclosure for their first fiscal year beginning on or after January 1, 2017.

View Bryan Cave’s Client Alert on the Pay Ratio Rule.

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FinCEN Proposes Broad AML Obligations for Investment Advisers

August 31, 2015

Authors

Jeff Ziesman

FinCEN Proposes Broad AML Obligations for Investment Advisers

August 31, 2015

by: Jeff Ziesman

As part of its continuing but slow expansion of the types of financial institutions that are subject to anti-money laundering (AML) obligations under the Bank Secrecy Act and USA PATRIOT Act, FinCEN proposed on August 25, 2015, to require certain investment advisers to establish and maintain AML programs and file suspicious activity reports (the Proposed Rules).  The Proposed Rules go further than FinCEN’s 2002 and 2003 proposals for investment advisors, which generally were limited to proposing AML program requirements only, without additional suspicious activity reporting and certain other record keeping requirements.

In explaining its rationale for the Proposed Rules, FinCEN acknowledges that advisers work with financial institutions that are already subject to BSA requirements, such as when executing trades through broker-dealers to purchase or sell client securities, or when directing custodial banks to transfer assets.  FinCEN notes, however, that these institutions may not have sufficient information to assess suspicious

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Can Your Bank Enter the Wealth Management Business?

January 29, 2015

Authors

Dan Wheeler

Can Your Bank Enter the Wealth Management Business?

January 29, 2015

by: Dan Wheeler

Have you thought about offering your customers wealth management services? The fee opportunities are attractive and the regulatory issues are more manageable than you might think.

Why should a bank’s board directors consider entering the wealth management business? For one, several of your competitors are already doing so. Wells Fargo already employs over 15,000 financial advisors and is looking to serve an even broader swath of the mass market than it already does. And, according to the American Banker, approximately 25% of all banks plan to offer wealth management services by the end of 2016, according to a survey conducted by that publication. If that survey data is representative across the banking industry, your board would not be in the leading edge if you are not considering the risks and rewards of building or acquiring a wealth management division.

This article assumes that U.S. community banks are not looking to

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SEC Adopts Final Rules to Rule 506 Private Placements

August 7, 2013

Authors

Robert Klingler

SEC Adopts Final Rules to Rule 506 Private Placements

August 7, 2013

by: Robert Klingler

The SEC recently adopted new rules to lift the ban on general solicitations and general advertising for Rule 506 private placements and Rule 144A offerings. In addition, the SEC also adopted rules disqualifying “bad actors” from taking advantage of the Rule 506 private placement safe harbor. These new rules will be effective on September 23, 2013. The SEC has further proposed new rules that, among other things, require an SEC filing at the start of Rule 506 placements involving general solicitation, the inclusion of additional cautionary legends and disclosures in offering materials as well as a temporary (two-year) requirement to file general solicitation materials with the SEC.

Regulation D’s Rule 506 provides a safe harbor exemption from registration under the Securities Act of 1933 for private offerings made to accredited investors and no more than 35 non-accredited investors who meet certain investment sophistication requirements. The SEC estimates that Rule 506

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Potential Securities Relief on the Horizon

October 27, 2011

Authors

Robert Klingler

Potential Securities Relief on the Horizon

October 27, 2011

by: Robert Klingler

While any relief still has a long (and uncertain) path before it would be effective, on October 26, 2011, the House Financial Services Committee approved four bills (with bipartisan support) that would remove regulatory federal securities law obstacles to capital formation.

H.R. 1965 would, for banks and bank holding companies, raise the SEC registration threshold to 2,000 shareholders and the deregistration threshold to 1,200 shareholders.

H.R. 2167, the “Private Company Flexibility and Growth Act,” would raise the SEC registration threshold for all companies to 1,000 shareholders and would exclude accredited investors and certain employees from the definition of “held of record” for registration purposes.

H.R. 2940, the “Access to Capital for Job Creators Act,” would permit general solicitation and general advertising for private offerings conducted under Rule 506, so long as all purchasers were accredited investors.

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Financial Services Update – September 23, 2011

September 23, 2011

Authors

Matt Jessee

Financial Services Update – September 23, 2011

September 23, 2011

by: Matt Jessee

House Passes Government Funding Bill, Shutdown Looms Again

The fiscal year Continuing Resolution (CR) that funds the government in lieu of Appropriations bills expires on September 30th. Therefore, Congress is required to pass another funding resolution by October 1st in order to prevent a government shutdown. The House passed its CR late Thursday night after cutting an additional $100M from the Department of Energy program that backed the Solyndra loan. The House bill contains $3.65B in disaster relief, which is partially offset by a $1.5B cut to a Department of Energy loan program for manufacturers of fuel-efficient cars. On Friday, the Senate voted to reject the House’s bill by a vote of 59 to 36 because Senate Democrat leaders are seeking greater disaster relief funding. The most likely outcome is for the House and Senate to pass a “clean” CR that funds the government until November 18 and postpones the

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Financial Services Update – September 16, 2011

September 18, 2011

Authors

Matt Jessee

Financial Services Update – September 16, 2011

September 18, 2011

by: Matt Jessee

Geithner Meets with Eurozone Finance Ministers

On Friday, Treasury Secretary Timothy Geithner met with seventeen European finance ministers in Poland to discuss the eurozone’s debt crisis. Jean-Claude Juncker, president of the Eurogroup, announced the group decided to delay till October a decision on whether to pay out the next tranche of a multi-billion euro loan to Greece. The two-day meeting of Europe’s Economic and Financial Affairs (ECOFIN) Council — hosted by Polish Finance Minister Jacek Rostowski and the president of the National Bank of Poland — comes ahead of G20 and IMF meetings later this month. The European Central Bank, along with the Fed, the Bank of England, the Bank of Japan and the Swiss National Bank, also announced that three U.S. dollar auctions would be held between October and December.

Senate Committee Passes Increased Funding for SEC and CFTC

On Thursday, the Senate Appropriations Financial Services Subcommittee passed its

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Financial Services Update – April 29, 2011

April 29, 2011

Authors

Bryan Cave

Financial Services Update – April 29, 2011

April 29, 2011

by: Bryan Cave

Q1 GDP Slows to 1.8%

On Thursday, the Bureau of Economic Analysis announced that the U.S. GDP growth rate in the first quarter of 2011 slowed to an annual rate of 1.8 percent, compared to a rate of 3.1 percent in fourth quarter 2010 and 3.7 percent in first quarter 2010. The Bureau cited a combination of lower-than-expected economic data, global energy uncertainty, and concerns about the budget deficit as causes of the growth rate decelerating.

Bernanke Announces Rates to Stay at Near Zero, Ends Bond Buying Program

On Wednesday, Federal Reserve Chairman Ben Bernanke held his first quarterly press conference in which he said that the economy and job market are improving moderately, but the housing market and other factors such as gas prices continue to be a drag on growth. He announced that the Fed plans to end the $600 billion treasury bond-buying program in June and will

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Financial Services Update – April 22, 2011

April 22, 2011

Authors

Matt Jessee

Financial Services Update – April 22, 2011

April 22, 2011

by: Matt Jessee

Japan Announces Disaster Relief Fund

On Friday, Japanese Finance Minister Yoshihiko Noda announced a 4 trillion yen ($48.5 billion) emergency budget for disaster relief in the wake of the nuclear crisis triggered by the March tsunami. Noda said the government would not issue new bonds to pay for the fund, and the cabinet plans to submit the emergency budget to parliament on April 28. Given that the material damage alone from the disaster could top $300 billion, the government is expected to seek additional future disaster funding that will likely require tax increases and debt financing.

Justice Department Examines NYSE/Nasdaq/ICE Merger

On Wednesday, Nasdaq-OMX CEO Robert Greifeld and ICE CEO Jeffrey Sprecher disclosed in a letter to NYSE Euronext’s board that they are in discussions with the antitrust division of the Justice Department (DOJ) after buying NYSE Euronext stock which triggered the DOJ’s antitrust review. The letter also disclosed that Nasdaq-OMX

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Financial Services Update – April 8, 2011

April 9, 2011

Authors

Matt Jessee

Financial Services Update – April 8, 2011

April 9, 2011

by: Matt Jessee

European Central Bank Announces Interest Rate Hike; Portugal Bailout Next

On Thursday, Jean-Claude Trichet, European Central Bank president, announced a 25 basis point rise in eurozone borrowing costs, to 1.25 percent. This will be the first of such an increase since the 2008 financial crisis. In response to the news, the euro initially dipped against the dollar but later appreciated to trade above $1.43. In his remarks, Trichet also said the ECB had encouraged Portugal to request an international bailout, which is estimated at 80 billion euros, roughly the same amount as Ireland but less than the 110 billion euro package offered to Greece. EU, European Central Bank and International Monetary Fund officials will meet in Lisbon next week to negotiate the cuts that are deeper than those that were rejected by Portuguese opposition politicians last month.

SEC Reviews Private Company Share Rules

On Wednesday, SEC Chairman Mary Schapiro sent

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