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The Board of Governors of the Federal Reserve System ("FRB") adopted a new rule (the "final rule") that requires U.S. global systemically important banking institutions ("GSIBs"), all GSIB subsidiaries (other than certain subsidiaries regulated by the OCC) and the U.S. operations of foreign GSIBs to amend qualified financial contracts ("QFCs") so that they cannot be cancelled immediately in the event of bankruptcy or a resolution process involving the GSIB or its affiliate. Such "QFCs" include [...]

Timing is key to valuation of all types and in all contexts. But in bankruptcy, valuation timing can take on heightened importance because a central element of bankruptcy involves distributing value as of a specific point in time. Higher valuation means larger creditor recoveries in bankruptcy, and lower valuation means smaller creditor recoveries. Valuation can also affect which creditors receive those recoveries and the extent to which various stakeholders retain an interest in the reorganized [...]