Earlier today, the Board of Directors (the “Board”) of the Federal Deposit Insurance Corporation (FDIC) approved a final rule to establish margin requirements on non-cleared swaps and security-based swaps (collectively, for this posting, “non-cleared swaps”).  The FDIC is issuing the rule jointly with the OCC, the board of the Federal Reserve,
Continue Reading A Marginally Important Day: FDIC’s Board Approves Joint Final Rule on Margin for Uncleared Swaps and Finalizes Relief for End-Users

On November 26th, the Division of Clearing and Risk (the “Division”) of the Commodity Futures Trading Commission (“CFTC”) published No-Action Letter 14-144 (also referred to as “CFTC Letter 14-144”), in order to update the conditions that must be satisfied by corporate end-users to avail themselves of “treasury affiliate relief” from the central clearing and trade execution mandate, as originally provided for by No-Action Letter 13-22 (the”2013 No-Action Letter”).  In general, No-Action Letter 14-144 relaxes conditions and requirements of the 2013 No-Action Letter that market participants highlighted as making use of the relief under that letter impractical for many treasury affiliates.

This posting provides background on the treasury affiliate exception and an overview of the current conditions that must now be satisfied by a treasury affiliate in order to claim relief from central clearing.  The relief afforded by this letter is likely to be of interest to both end-user and swap provider counterparties, as there are conditions of the relief that apply to both “sides” of the trade.


Continue Reading Attention Corporate Treasurers and Swap Provider Banks: CFTC Updates End-User Exception For Treasury Affiliates