Resolving complex transactional, regulatory, litigation and enforcement challenges
Dechert is a trusted advisor to financial institutions worldwide, with extensive sector experience built upon a century-long heritage of bank representations. Our experience and track record is well chronicled with regard to M&A transactions and contests for control, marketplace lending and financial technology, federal and state bank regulation, systemic stability regulation and bank enforcement and litigation.
Dechert’s financial institutions and bank regulatory practice is built on the decades of experience our lawyers have in advising large, regional, foreign and community financial services companies, their holding companies and investors, private and registered funds, and asset managers with regard to the most complex transactional, regulatory, litigation and enforcement challenges that confront them.
Our practice includes former government officials and regulators who, throughout their careers, have been at the forefront of developments in the industry.
Mergers, Acquisitions & Other Control Transactions
- Wells Fargo’s acquisition of the banking assets of GECC
- Federal Credit Union bid proposal to the National Credit Union Administration (NCUA) to acquire Montauk Credit Union (in Conservatorship)
- Capital One’s US$9 billion acquisition of ING FSB
- Bank of Ireland’s €1.1 billion recapitalization by five U.S. private investors
- Certares LP joint venture with American Express, a bank holding company, to provide business travel services
- Equity Bancshares Inc. acquisition of First Community Bancshares
- First Bank of Delaware transfer of its assets and liabilities to a liquidating trust for the benefit of its public shareholders in connection with the sale of assets to the Bryn Mawr Trust Company
- Various Bank Holding Companies establishment of joint ventures to invest in middle market commercial loans
- Foreign Banking Organizations with respect to their acquisitions and investments in the United States
- Harleysville National Corporation, a bank holding company, in connection with its merger with First Niagara Financial Group, Inc.
- Power Corporation of Canada’s US$3.9 billion acquisition of Putnam Investments, Inc.
- A Private Investor obtaining a no-action letter from the OCC in connection with the acquisition of bank shares
- A Financial Services Company’s acquisition of a federally chartered credit card bank regulated by the OCC
- Various Bank Holding Companies organization of business development companies (BDCs)
- An FDIC-Insured Bank pre-existing FDIC insurance premium adjustments
Marketplace Lending & Fintech Representations
- BitGo, Inc. in connection with an equity investment by Goldman Sachs
- Certain large mutual funds complexes and their Boards of Directors with respect to the acquisition by the Funds of residential mortgage loans.
- Morgan Stanley Investment Management in the establishment of AIP Alternative Lending Fund A and AIP Alternative Lending Fund P - registered closed-end funds organized primarily to acquire marketplace loans.
- A digital asset and technology company with respect to the establishment of a de novo special purpose national bank charter
- A consumer payments fintech company in responding to a civil investigative demand from the CFPB
- A major fintech company in an inquiry regarding money transmission licensing requirements
Open Bank Recaps & De Novo Bank Charters
- A wealth management company application to establish a de novo national trust bank (in process)
- A life insurance company’s de novo formation of a federal savings bank to engage in the trust/fiduciary business
- Negotiation of a Consent Order between Melrose Credit Union and the New York State Department of Financial Institutions
- Advising Citibank regarding a CFPB enforcement action alleging violations of the Credit Card Accountability and Responsibility and Disclosure Act of 2009 relating to credit card add-on products
- National Bank Advice regarding a CFPB mortgage origination examination alleging violations of fair and responsible banking, including ECOA, HMDA, RESPA, TILA and UDAAP laws
- Dechert’s chairman, Andy Levander, has advised many of the leading financial institutions or their affiliates such as AIG, Aon, Bank of NY, Barclays, Citigroup, Credit Suisse, GLG Man Group, Goldman Sachs, JP Morgan, Merrill Lynch, Morgan Stanley, the NYSE, RCS Capital Management LLC, Riverstone Holdings, Societe Generale and UBS. For example, in 2012, he led the defense of Deutsche Bank in a billion dollar False Claims Act case brought by the United States Attorney’s Office of the Southern District of New York and, in 2006, he negotiated a global settlement for BAWAG, Austria’s fourth largest bank, with Refco’s debtors, creditors, shareholders, bondholders and investors, as well as with the SEC and the Department of Justice.
FSOC & FSB Representations
- The U.S. Chamber of Commerce and the ICI as amicus in MetLife’s challenge in federal district court and the U.S. Court of Appeals to its designation of MetLife as a SIFI by FSOC
- A large financial services company in the administrative challenge of FSOC SIFI designation rules
- A large trade association, Filing comments with regard to the FSOC SIFI designation rules
- An insurance company with regard to the FSOC designation process, submission of arguments and designation appeal
- A large financial services company with regard to potential designation by FSOC as SIFI designation rules
- A large trade association filing comments with regard to the FSOC SIFI designation rules
- An insurance company representation through the FSOC designation process, submission of arguments and designation appeal
- Advising a large financial services company with regard to potential designation by FSOC as SIFIs
- Two large trade associations filing comments with FSOC with regard to its money market fund recommendations under Section 120 of Dodd-Frank
- Advising a large trade association with regard to comments concerning the Office of Financial Research’s report on the potential designation of asset management firms
- Filing comments on behalf of a large asset management company concerning FSB’s methodology on the potential designation of asset management firms
Financial services companies value our practical experience in guiding their compliance with regulatory challenges and the development of alternative structures, transactions and operations impacted by the hundreds of rules stemming from the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank) and the balance of federal and state regulation which impact nearly every aspect of their business structuring controlling and non-controlling investments in banks, pursuing de novo bank charters, and interpreting the scope and application of the Volcker Rule and the Federal Reserve Board’s (FRB) merchant banking rules.
We appear for our clients before the:
- Federal Reserve Board (FRB)
- Office of the Comptroller of the Currency (OCC)
- Federal Deposit Insurance Corporation (FDIC)
- Consumer Financial Protection Bureau (CFPB)
- Financial Stability Oversight Council (FSOC)
- Securities and Exchange Commission (SEC)
- Federal Housing Finance Agency (FHFA)
- Department of Justice (DOJ)
- New York Department of Financial Services
- Other states that maintain a high profile in financial institutions regulation and enforcement
Keeping banking clients on the leading edge
- We counsel banking organizations and investors on a wide range of regulatory matters, including bank acquisitions, the establishment of de novo banks and the scope of permissible activities and investments under federal and state banking law. We regularly advise clients on the application of the Volcker Rule and in structuring non-controlling investments in banks and other entities.
- We also closely monitor developments in the marketplace lending and Fintech space and advise clients on a range of related matters, including state licensing requirements, the applicability of federal preemption and the process for obtaining an OCC Fintech or other special purpose charter.
Bank Sponsored Common and Collective Trust
We assist banks and trust companies with the establishment of collective trust funds, but most often work with investment managers that partner with banks or trust companies in order to make their investment management services available to retirement plan investors. In addition, our lawyers:
- Advise on establishment and operation of the funds and related regulatory requirements.
- Assist with the requirements for maintaining exemption from SEC registration for collective investment funds that are sub-advised by non-affiliated entities.
- Advise financial institutions and investment advisory firms offering collective funds as investment options in 401(k) plans and other retirement products
- Advise regarding use of common trust funds as investment vehicles for tax-exempt and non-U.S. institutional investors.
- Advise on issues relating to the use of collective funds as vehicles for investing in alternative asset classes.
- Assist financial institutions in converting their common and collective funds into proprietary mutual funds registered with the SEC.
The Volcker Rule
The Volcker Rule imposes substantial compliance requirements on a banking entity’s board of directors and management. Our lawyers are uniquely positioned to advise clients on these matters.
- We have practiced at or appeared before all of the agencies responsible for implementing the Volcker Rule and are nationally recognized by Chambers USA for our work in Financial Services: Banking in both Regulatory Enforcement & Investigations and Compliance.
- Our lawyers are working with both U.S. and non-U.S. clients to address the wide range of strategic, operational and regulatory issues that are raised by the Volcker Rule, both for banking entities and entities that are not subject to the Rule.
- Dechert has authored a comprehensive book on this topic titled The Volcker Rule: Commentary and Analysis which was published by Thomson Reuters in April 2014.
The Bank Holding Company Act and Change in Bank Control Act
The Bank Holding Company Act (BHCA) and the Change in Bank Control Act (CBCA) each impose requirements on banks and their parent holding companies and affiliates with respect to filing obligations and permissible activity limitations. Our lawyers have broad experience in interpreting these statutes and related regulatory agency guidance and are uniquely positioned to assist clients on these matters:
- We have counseled funds, asset managers and other corporate clients in structuring transactions and investments to comply with requirements under the BHCA and the CBCA.
- We often are called upon to analyze cross-border investments and represent global asset management firms in connection with their activities within the United States, including permissible investments under Section 4 of the BHCA and permissible activities of Financial Holding Companies under Regulation Y.
- We regularly counsel private equity fund clients in interpreting the Federal Reserve Board’s interpretations of control under the BHCA and assist in structuring transactions and agreements consistent with these interpretations.
Top-ranked for M&A by the most prominent league tables and legal directories, Dechert advises clients engaged in mergers, tender and exchange offers, leveraged buyouts, cross-border transactions, going-private transactions, strategic alliances, collaborations and joint ventures, acquisitions, divestitures, proxy contests, and special committee assignments.
During the planning phase, we analyze tax and regulatory implications and conduct risk assessments.
Our interdisciplinary team handles every aspect of complex regulated transactions, including mergers between healthy banks, controlling and non-controlling investments in banks by private equity or hedge funds and FDIC-assisted acquisitions of failed institutions.
Whether advising a target or acquiring a company regarding sale, responding to an unsolicited “bear hug”, implementing a corporate restructuring, devising anti-takeover measures, conducting a proxy contest or consent solicitation, or litigating the many issues that arise in such contested situations, Dechert lawyers have been there on behalf of clients.
Dechert’s bank regulatory lawyers have extensive experience in working on corporate transactions which require regulatory approvals.
- We especially understand the importance of developing regulatory, transactional and litigation strategies that complement each other and are focused on achieving our clients’ clear objectives.
- In addition to this experience and the many transactional matters that our lawyers have advised on, they are also authors of numerous articles on transactional issues, as well as three highly regarded books on the bank control rules applicable in contested and non-contested situations.
- They are experts in the federal banking agencies’ control rules which apply to the issues that inevitably arise in these matters.
We regularly handle many of the most complex bank and financial institution enforcement cases, whether working to prevent charges from being filed, mounting a proactive defense, negotiating a settlement, or handling pretrial and trial advocacy.
Similarly, with an experienced regulatory eye, we handle internal investigations on behalf of companies and their boards of directors relating to regulatory violations, disclosure issues, accounting irregularities, whistleblower matters, money laundering, insider transactions, financial statement irregularities, regulatory filings, market timing and insider trading issues, among others.
We also assist our clients in navigating related complex issues, particularly where third party lawsuits have been brought or are threatened, and whistleblowers, criminal prosecutors or grand juries complicate the investigation.
Our lawyers have handled dozens of ground-breaking lawsuits in a variety of federal and state courts involving a wide range of bank regulatory policies, actions, transactions and regulations.
We have extensive experience consumer financial services and payments matters and have represented banks and companies in investigations and proceedings brought by the CFPB, other bank regulatory agencies and the DOJ.
Dechert lawyers have deep experience advising on federal receivership issues related to the FDIC. Additionally, we possess a thorough understanding of the impact of FDIC receivership rules on the claims and counter-claims that arise when a bank’s parent holding company files for bankruptcy. We regularly represent creditors, investors and borrowers in the claims and receivership resolution process, as well as related lawsuits against FDIC Receivers.
Our lawyers have appeared before the Financial Stability Oversight Council (FSOC) and its various subcommittees, commented on or challenged its pronouncements and designations regarding systemically important financial institutions (SIFIs) on behalf of large insurance companies, non-depository financial institutions and private as well as registered investment funds and managers.
We have also submitted a variety of comments to the FSOC and the Financial Stability Board (FSB) on a wide range of systemic issues and policies impacting our clients and their potential designation. We have also participated in the first litigation against FSOC, filing an amicus brief in support of MetLife’s challenge to its designation as a SIFI.