U.S. Fed issues rule to implement Dodd-Frank swaps push-out

WASHINGTON, June 5 Wed Jun 5, 2013 2:42pm EDT

WASHINGTON, June 5 (Reuters) - The Federal Reserve approved a rule Wednesday requiring that banks receiving federal deposit insurance should spin off some of their swaps trading into separate arms.

The interim final rule, which implements the so-called swaps push-out provision of the 2010 Dodd-Frank law, clarifies that U.S. branches and agencies of foreign banks will be treated as insured depository institutions and will be eligible for a transition period, the Fed said.

The swaps push-out provision takes effect July 16, but banks can request up to 24 months to comply, the Fed said.

Interim final rules are subject to changes if necessary, regulators said, and the Fed will accept comments on the rule through Aug. 4.