The Treasury Market Practices Group (“TMPG”) announced on June 28, 2011 the final recommended trading practices for Agency Debt and MBS. The recommendations are available at the links below. The Agency Debt practice is unchanged from the proposal; for MBS, the important change is the lowering of the penalty rate from 3% to 2%. The proposed effective dates are as follows:

The TMPG recommends that the fails charge apply to transactions entered into on or after February 1, 2012, as well as to transactions that were entered into prior to, but remain unsettled as of, February 1, 2012. For transactions entered into prior to, and unsettled as of, February 1, 2012, the TMPG recommends that the fails charge begin accruing on the later of February 1, 2012, or the contractual settlement date.
More details on TMPG’s announcements may be found below.  

• Treasury Market Practices Group 
• Agency Debt Securities Fails Charge Trading Practice Summary 
• Agency Mortgage-Backed Securities Fails Charge Trading Practice Summary