Shearman & Sterling represented J.P. Morgan as the initial purchaser in connection with KWG Group Holdings Limiteds tap offering of $158 million 7.40% senior notes due 2024. Finalists University of The DoddFrank Act added a new Section 27B to the Securities Act intended to address certain conflicts of interest that, if implemented, could create significant hurdles for synthetic securitisations. Shearman & Sterling advised IFC on the first housing bond issued in Bangladesh, provided to BRAC Bank Limited. Under the most recent no-action letter, the SEC staff will not take enforcement action against a broker-dealer that publishes, or submits for publication, quotations for fixed-income securities, if the broker-dealer reasonably has determined that the security or its issuer meets one of several specified criteria, or there is current and publicly available financial information (consistent with Rule 15c2-11(b)) about the issuer. The case is currently stayed and briefs have been filed, including an amicus curiae brief filed by the Structured Finance Association in support of the Trusts position. The old trope of competition at US firms was something that the current intake was quick to dismiss too. The presence or absence of some or all of these factors does not necessarily result in substantive consolidation. The Trusts hold more than 800,000 private education student loans totalling approximately USD12 billion, all of which were originated by private banks prior to 2008. An SPE that is subject to entity-level tax, such as a corporation or a partnership that is taxed as a corporation, will potentially incur tax liability for any gains resulting from the sale of financial assets and any income otherwise paid with respect to the financial assets in excess of deductible expenses. The firms structured transactions practice serves the financing needs of the worlds most sophisticated businesses. the transferors obligation to pay the transferees collection costs for delinquent or uncollectible financial assets. Synthetic securitisations are permitted. Shearman & Sterling advised Osaka Gas and its U.S. subsidiary Osaka Gas USA Corporation in connection with the agreement with Oriden LLC to jointly develop a portfolio of more than 700 MWdc (600 MWac) of utility-scale solar and storage projects throughout certain U.S. markets. DaFa Properties Group Limiteds $100 million Senior Notes Offering. One trainee quipped that its more likeable than other types of finance, because its more tangible and more rewarding when youre working to finance something from nothing! Trainees were quick to highlight that the teams work involves plenty of crossover with the firms offices in Abu Dhabi and Saudi Arabia too. Penalties for violating the rules can include suspension or revocation of an NRSROs registration if the SEC makes a finding under certain specified sections of the Exchange Act that the NRSRO violated the conflicts-of-interest rule and the violation affected a credit rating. In some instances, the perfection representations relating to chattel paper may also call for the original being marked as pledged to the trustee to reduce the risk that a third-party acquirer obtains possession without actual knowledge of the prior security interest. If that strategy is not available, there are a number of potential exclusions from the covered fund definition in the Volcker Rule itself, of which the loan securitisation exemption is most important in the securitisation context. Reg AB II deviates from the typical shelf registration practice of using a base prospectus and a supplemental prospectus, and instead requires the filing of one integrated prospectus. OGUSA's Joint Venture with MHI Group to Acquire Brighter Future Solar Farm. Reg AB II introduced new ABS-specific registration statement forms, Forms SF-1 and SF-3, to reflect the additional disclosure requirements and shelf-eligibility requirements under Reg AB II. If the CDS counterparty becomes subject to bankruptcy proceedings, the SPE will nevertheless have the right to terminate and close out each swap entered into with that counterparty, and realise against any collateral or other credit support relating to such swap, without being subject to the stay or the prohibition against ipso facto clauses. Among the reasonable determinations that qualify for relief are the following. Under the CFPA, a covered person includes (A) any person that engages in offering or providing a consumer financial product or service; and (B) any affiliate of a such a person, if such affiliate acts as a service provider to such person. In June 2017, the ARRC identified SOFR as its preferred alternative to LIBOR for many purposes, including securitisations. satisfaction of specified eligibility criteria when sold; all required consents and authorisations having been obtained; various additional tailored representations. The CFTC can also impose equitable remedies, including restitution and disgorgement of gains. The combination of our extensive experience and global presence enables us to provide clients with swift, coordinated and effective advice on a variety of tax issues in multiple jurisdictions. He assists clients with administrative proceedings as well as litigation in the US Tax Court. The court did not decide whether the Trusts have any liability for the actions of the servicers only that the CFPB has enforcement jurisdiction over the Trusts. Banks that are primarily constrained by the leverage ratio, as compared to the risk-weighted assets (RWA) ratio, will also typically view highly rated, but lower-yielding, senior securities as less attractive investments, whereas insurance companies and banks that are primarily constrained by the RWA requirements may find the highly rated senior tranche highly attractive due to the small amount of regulatory capital required. Held here at our London office, the day will comprise of the following: An introduction to the industry and to Shearman & Sterling. For a sale of financial assets to be valid and enforceable against third parties, it has to attach and be perfected similar to what applies to a security interest in collateral. Shearman & Sterling has historically run four vacation schemes: one in the winter, two in spring, and one in the summer. In September 2017, the Consumer Financial Protection Bureau (CFPB) filed suit against 15 National Collegiate Student Loan Trusts (the Trusts), alleging that the Trusts had violated the Consumer Financial Protection Act (CFPA) by engaging in unfair and deceptive practices in connection with the servicing and collection of the private education (not Federally guaranteed) student loans owned by each of the Trusts (but not originated nor serviced by any Trust entity). Establishing a bankruptcy-remote special-purpose entity (SPE) is a key aspect of a typical securitisation transaction. As a result, the ruling, if upheld on appeal, would allow the CFPB to proceed with an enforcement action directly against the Trusts for liability for actions undertaken by the Trusts servicers (on behalf of the Trusts) and not by the Trusts themselves. For those trainees hoping for the luck of the draw, the projects development & finance (PDF) seat is one plenty will have their eye on. Admittedly, I had no idea what these terms meant going in, one trainee (reassuringly) quipped, but you learn so much as you go. In fact, trainees told us that through regular meetings, the firm was always transparent about what trainees could get involved in, which ranged from document management and helping with conditions precedent, to board minutes and one-on-one emails with clients and counsel. The perfection of a security interest in a financial asset automatically also perfects a security interest in related supporting rights, such as collateral or letter of credit rights. There is no effect on contracts that already contain fallback provisions that identify a benchmark replacement that is not based in any way on USD LIBOR, or as to which the parties agree in writing to opt out of the application of the LIBOR Act. Because of the significant consequences to the securitisation transaction, the rating agencies tend to require an opinion to the effect that the SPEs activities would not amount to it engaging in a US trade or business. The Trust Indenture Act of 1939 is amended to provide that the right of any holder of any indenture security to receive payment of the principal of and interest on such indenture security shall not be deemed to be impaired or affected by any change occurring by the application of the LIBOR Act to any indenture security. Owner trustees typically act on behalf of the holders of any trust certificates issued by an issuer trust (if applicable). The penalties range from injunction or restraining orders, writs or orders mandating compliance, to fines. The National Association of Insurance Commissioners (NAIC) has adopted a risk-based capital (RBC) methodology intended to be a minimum regulatory capital standard based on the insurance companys risk profile and is one of the tools that give regulators legal authority to take control of an insurance company. The firms success is built on its clients success. At the time the ARRC fallback recommendations were released, term SOFR rates were purely theoretical: SOFR was primarily an overnight rate, measuring the cost of borrowing cash overnight as collateralised by US Treasury securities in the repurchase agreement market. Clients hail from a range of sectors, including banking, media and aerospace. Shearman & Sterling is one of the worlds leading law firms, serving the domestic and cross-border needs of an impressive roster of clients. The LIBOR Act covers contracts that reference LIBOR tenors other than the uncommon one-week and two-month tenors, and provides as follows. The structure also allows for some series to be in their revolving period while other series are in their amortisation period. Consequently, the traditional means of addressing the Volcker Rule have been to avoid relying on any of these exemptions. As noted above, transactions that violate the securities laws may be voidable and may give rise to both private and public enforcement. However, many broker-dealers appear to have concluded that their quotation procedures for these securities do involve publishing them (or submitting them for publication), so that the rule does not apply. The firm now recruits exclusively through its vacation scheme. You hear that US firms have cut-throat cultures, but that isn't the case, one emphasised. Follow Shearman & Sterling on Instagram and LinkedIn. Regularly advises on complex tax planning and structuring matters. Until recently, Rule 15c2-11 has always been understood by market participants to apply only to equity securities. We were told that if you hit a certain number of hours of pro bono, you get a star on your door. Who said lawyers couldnt be suckers for some positive reinforcement? Synthetic securitisations typically use credit default swaps (CDSs) to transfer such exposure. Our Firm Overview:Shearman & Sterling has a long and distinguished history of supporting its clients wherever they do business, from major financial centers to emerging and growth markets, for nearly 150 years. Each Fellow receives $25,000 and the opportunity to clerk in one of our U.S. offices the summer following their 1L or 2L year. I was looking for top-tier transactional work in areas like finance and M&A, one trainee told us, and thats where the firms profile comes into its own. In fact, Chambers UK awards the firm a host of rankings in banking & finance and capital markets in the capital, as well as a top-tier nod for its projects work nationwide. Guangzhou Fineland Real Estate Developments Exchange Offer and Concurrent New Money Offering. There may also be additional representations relating to the nature and characteristics of the relevant assets. However, such securities offerings generally will look to, and to the extent practicable seek to comply with, the disclosure requirements applicable to registered offerings. Shearman & Sterling represented HSBC as the sole dealer manager in connection with an offer to purchase for cash by Jiayuan International Group Limited for its outstanding 13.75% senior notes due 2022. The independent director(s) also provide(s) important protection against dissolution of the SPE, in part by requiring such a directors participation in a dissolution decision, and in part by providing that such independent director becomes a springing member or springing partner if the absence of a member or partner would cause dissolution. 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