News Article Reuters February 9, 2011 In remarks prepared for the hearing and released by the House Agriculture Committee, CFTC Chairman Gary Gensler said margin requirements would be aimed at swap dealers, not end users, who are exempt from clearing requirements. "Proposed rules on margin requirements should focus only on transactions between financial entities rather than those transactions that involve non-financial end users," Gensler said. Cross References Dodd-Frank Act, Title VII, Secs. 723(a)(7) 731; new CEA Secs. 2(h)(7) 4s(e)(3)(A) CWT C&F Memo: Regulation of End Users of Swaps Under
International Swaps and Derivatives Association April 14, 2011 ISDA today released preliminary results from its 2011 ISDA Margin Survey. The Survey reveals that, among large dealers, 80 percent of all transactions are now executed with the support of a collateral agreement. The process of reconciling collateralized portfolios shows steady advances in adoption. One hundred percent of large dealers and 73 percent of all survey respondents indicated that they pro-actively perform portfolio reconciliations.
CFTC Dodd Frank Rulemaking 76 FR 23732 April 28, 2011 Comment Period Closing Date: June 27, 2011 The proposed regulations would implement the new statutory framework of Section 4s(e) of the Commodity Exchange Act ("CEA"), added by Section 731 of the Dodd-Frank Act, which requires the Commission to adopt capital and initial and variation margin requirements for certain swap dealers ("SDs") and major swap participants ("MSPs"). The proposed rules address initial and variation margin requirements for SDs and MSPs. The proposed rules will not impose margin requirements on nonfinancial end users
CFTC Speeches May 11, 2011 "NOT ALL END-USERS ARE CREATED EQUAL" Commissioner Scott O'Malia expresses concerns regarding the margin and capital rules as they interact with the definition of swap dealer. He observes that many of the comments related to the proposed definition echo "a recurring theme: the definition is too broad and the exceptions are too narrow. Unfortunately, our proposal captures legitimate commercial end-users as swap dealers." On capital and margin requirements for end-users, O'Malia states that "there is no doubt that the cost for end-users in all categories to hedge their
CFTC Notice May 12, 2011 The CFTC is proposing to adopt capital, financial reporting, and recordkeeping requirements for certain swap dealers (SDs) and major swap participants (MSPs), as well as proposing to amend certain capital requirements for futures commission merchants (FCMs) that also register as SDs or MSPs and supplemental capital requirements, and supplemental financial reporting requirements for these FCMs. The comment period for the proposed rules is being aligned with that of the Commission's proposed rulemaking on margin requirements so that commenters will have the opportunity