S.Amdt. 4110

SA 4110. Mr. DODD submitted an amendment intended to be proposed to
amendment SA 3739 proposed by Mr. Reid (for Mr. Dodd (for himself and
Mrs. Lincoln)) to the bill S. 3217, to promote the financial stability
of the United States by improving accountability and transparency in
the financial system, to end ``too big to fail'', to protect the
American taxpayer by ending bailouts, to protect consumers from abusive
financial services practices, and for other purposes; which was ordered
to lie on the table; as follows:

On page 515, between lines 11 and 12, insert the following:
(c) Prohibition on Proprietary Trading.--No insured
depository institution, or company that controls, directly or
indirectly, an insured depository institution or is treated
as a bank holding company for purposes of the Bank Holding
Company Act of 1956 (12 U.S.C. 1841 et seq.), or any
subsidiary of such depository institution or company may
purchase or sell, or otherwise acquire or dispose of
derivatives, including swaps, security-based swaps, mixed
swaps, and security-based swap agreements except in
accordance with section 619 of the Restoring American
Financial Stability Act of 2010.
(d) Study and Report.--
(1) Study.--The Financial Stability Oversight Council shall
conduct a study of the impact of the prohibitions of this
section on the swaps and security-based swaps markets,
including the effect of such prohibitions on central clearing
and exchange trading of standardized swaps.
(2) Report.--Not later than 1 year after the date of
enactment of this Act, if the Financial Stability Oversight
Council agrees by an affirmative vote of the majority of its
members then serving to the conclusions and findings of the
study required under paragraph (1), and to any
recommendations for legislative action the Council deems
necessary and appropriate based on such conclusions and
findings, the Council shall make such report, together with
such recommendations, available to the public.
(e) Determination and Finding.--
(1) Determination.--Following issuance of the report
required under subsection (d) and based upon consideration of
the findings and conclusions of the study mandated by such
subsection, the Chairperson of the Financial Stability
Oversight Council may make a written determination
suspending, in whole or in part, the prohibitions of
subsection (a) upon the consideration of the recommendations
of such report and a finding that the prohibitions in
subsection (a) would have a material adverse effect on the
financial markets and economy of the United States.
(2) Congressional notice; effectiveness.--The Chairperson
of the Financial Stability Oversight Council shall submit any
written determination under this subsection, together with
the report required under subsection (d), and any
recommendations for legislative actions, to the Committee on
Banking, Housing, and Urban Affairs and the Committee on
Agriculture, Nutrition, and Forestry of the Senate and the
Committee on Financial Services and the Committee on
Agriculture of the House of Representatives. Any such written
determination by the Chairperson of the Financial Stability
Oversight Council shall not be effective until such
determination has been submitted to the appropriate
committees of Congress described in the prior sentence.
(f) Prudential Matters.--If the prohibition established
under subsection (a) is suspended, in whole or in part,
pursuant to subsection (e), the swaps entity shall conduct
its swap, security-based swap, or other activities in
compliance with such minimum standards as shall be prescribed
in regulations issued by the prudential regulator of such
swaps entity as appropriate and which are reasonably
calculated to permit the swaps entity to conduct its swap,
security-based swap, or other activities in a safe and sound
manner and consistent with protecting taxpayers and the
financial system of the United States.
(g) Rules.--In prescribing regulations described in
subsection (f), the prudential regulator for a swaps entity
shall consider the following factors:
(1) The expertise and managerial strength of the swaps
entity, including systems for effective oversight of the
swaps entity.
(2) The financial strength of the swaps entity.
(3) Systems for identifying, measuring, and controlling
risks arising from the swaps entity's operations and
activities.
(4) Systems for identifying, measuring, and controlling the
swaps entity's participation in existing markets.
(5) Systems for controlling the swaps entity's
participation or entry into in new markets and products.
(h) Effective Date.--Subject to subsection (e), the
prohibition established under subsection (a) shall take
effect 2 years after the date on which the Wall Street
Transparency and Accountability Act of 2010 becomes
effective.
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