Federal swap margin proposals

Published: 13 February 2018



Five US prudential regulators have proposed amendments to the minimum margin requirements for registered swap dealers, major swap participants, security-based swap dealers and major security-based swap participants. The proposed amendments are intended to harmonise the swap margin rules with recent rule changes that impose new restrictions on certain qualified financial contracts (QFCs) of systemically important banking organisations.  

Under the proposed amendments, legacy swaps entered into before the applicable compliance date would not become subject to the margin requirements if they are amended solely to comply with the requirements of the QFC Rules. The proposed amendments would also harmonise the definition of "Eligible Master Netting Agreement" in the Swap Margin Rule with recent changes to the definition of "Qualifying Master Netting Agreement" in the respective capital and liquidity regulations of the Federal Reserve, Federal Deposit Insurance Corporation (FDIC) and Office of the Comptroller of the Currency (OCC) by recognising the restrictions that were adopted by these agencies with respect to the QFC Rules. The agencies request comments on the proposed amendments no later than 60 days after the date of their publication in the US Federal Register.

If members have any questions or comments please contact the AIMA Markets Regulation Team.