OCC Issues Final Rule on Collective Investment Funds

The OCC today finalized a rule on prior notice periods for withdrawals from collective investment funds that are invested in real estate or assets not readily marketable. The final rule—which codifies an interim final rule issued by the OCC last year—allows banks to apply to the OCC to extend the one-year redemption period by another year due to unanticipated and severe market conditions for specific assets held by the fund, subject to meeting certain conditions.

The final rule is substantively similar to the IFR, however, the OCC made an American Bankers Association recommended minor revision to one of the conditions necessary for the extension. The rule takes effect upon publication in the Federal Register.