Senator Warren and Representative Cummings Request Information from Banks Regarding Swaps Trading Practices

U.S. Senator Elizabeth Warren (D-MA) and House Representative Elijah E. Cummings (D-MD) sent letters to multiple banks, requesting information about how the institutions will alter their swaps trading practices in response to the passage of Section 630 of the 2015 Consolidated and Further Continuing Appropriations Act ("Section 630") (i.e., the amendments to the swaps "push-out" requirements of Section 716 of Dodd-Frank).

In the letter, Senator Warren and Rep. Cummings requested information from the banks so as to "aid in our oversight of the impact of Section 630." Information requested includes:

• the definition of the term "hedging" and "risk management purposes" that the firm will use to determine which swaps trades can now be made under Section 630;
• the total value of derivatives contracts the institution holds for each of "hedging" and "risk management purposes," and the total value of swaps derivatives contracts the institution holds for each of these purposes;
• the types of transactions included in the term "structured finance swap" as used in Section 630, and the value of these transactions;
• copies of the institution's application to the Office of the Comptroller of the Currency to delay implementing Dodd-Frank Section 716;
• a description of any "operation and credit risks" the institution would have experienced had it been required to implement the provisions of Section 716; and
• the total value of swaps the institution would have "pushed out" under Section 716 absent the changes in Section 630, and the total value of swaps the institution now expects to "push out."

Senator Warren and Rep. Cummings requested the information be provided by February 26, 2015, and request a briefing from an official of the institutions by February 19, 2015.

See: Senator Warren's Press Release and Links to Letters. Related news: Senate Approves Appropriations Bill Amending Swaps Push-Out Rule (with Lofchie Comment) (December 12, 2014); Congress to Vote on Bill to Repeal Swaps Push-out Requirements (with Lofchie Comment) (December 10, 2014); FRB Approves Final Rule Clarifying Treatment of Uninsured U.S. Branches of Foreign Banks under "Lincoln" (December 24, 2013).