SECTION 1. Section 6(a) of Chapter 167E of the General Laws is hereby amended by inserting a new clause (6) as follows:
(6) The total obligations of one borrower for the purposes of this section shall include credit exposures as a counterparty in derivative transactions with the bank. For purposes of this clause (6), (i) the term “derivative transaction” shall include any transaction that is a contract, agreement, swap, warrant, note, or option that is based, in whole or in part, on the value of, any interest in, or any quantitative measure or the occurrence of any event relating to, one or more commodities, securities, currencies, interest or other rates, indices, or other assets; and (ii) “credit exposure” to a counterparty in connection with derivative transactions shall be determined based on an amount that the bank reasonably determines under the terms of the derivative or otherwise would be its loss were the counterparty to default on that date, taking into account any netting and collateral arrangements, and any guarantees or other credit enhancements; provided that the bank may elect to determine credit exposure on the basis of such other method of determining credit exposure as may be permitted by the bank’s primary Federal regulatory authority.
The information contained in this website is for general information purposes only. The General Court provides this information as a public service and while we endeavor to keep the data accurate and current to the best of our ability, we make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability or availability with respect to the website or the information contained on the website for any purpose. Any reliance you place on such information is therefore strictly at your own risk.