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Risk Retention Rule

Risk Retention Rule

Parent term
Structured Security

The Risk Retention rule was a part of the Dodd Frank act that required structured security mangers to retain up to 1/2 of the equity tranche of deals they originated

  • Part of the Dodd Frank act
  • Required CLO managers to keep up to 1/2 the equity tranche of deals they originated
  • Goal was to align manger interests with that of investors
  • Rule was invalidated by U.S. Court of Appeals in 2018

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