Margin Requirements for Uncleared Swaps for Swap Dealers and Major Swap Participants

SIFMA’s Asset Management Group (AMG) provides comments to multiple regulators on margin requirements for uncleared swaps for swap dealers and major swap participants. The letter includes recommendations that margin requirements be bilateral, unless the end user party elects not to require such margin from its counterparty and that regulators should divide financial entities into five categories, to which different thresholds apply (in decreasing order):

• regulated low-systemic risk entities
• prudentially-regulated entities
• low-risk financial entities
• other entities (other than key market participants)
• key market participants

The letter was sent to the Basel Committee on Banking Supervision (BCBS), International Organization of Securities Commissions (IOSCO), Commodity Futures Trading Commission (CFTC), Office of the Comptroller of the Currency (OCC), Board of Governors of the Federal Reserve System (Fed), Federal Deposit Insurance Corporation (FDIC), Farm Credit Administration (FCA), and the Federal Housing Finance Agency (FHFHA).