SIFMA provides comments to the Office of the Comptroller of the Currency (OCC), the Board of Governors of the Federal Reserve System, and the Federal Deposit Insurance Corporation (FDIC) (collectively the Agencies) on their jointly proposed rulemaking, Liquidity Coverage Ratio: Liquidity Risk Measurement, Standards, and Monitoring, RIN: 1557-AD74. This comment letter is offered by SIFMA’s Municipal Securities Division and focuses on issues raised by the Proposal related to municipal securities, municipal securities financing and state and local government finance. SIFMA is participating with other organizations in a separate industry-wide comment letter that will cover broader issues raised by the Proposal.

SIFMA’s comments on the Proposed Rule focus on three areas: the exclusion of municipal securities from the definition of High-Quality Liquid Assets (HQLA), outflow rate assumptions applied to bank liquidity facilities extended to certain special purpose entities (municipal Tender Option Bond financing vehicles), and the outflow rate assumptions assigned to public sector entity deposits that are collateralized with municipal bonds.