Submitted via [email protected]
Securities and Exchange Commission
100 F Street NE
Washington, DC 20549-1090
Re: Amendment No. 1, to Amend the Requirements for Covered Agency Transactions under FINRA Rule 4210 (Margin Requirements) as Approved Pursuant to SR-FINRA-2015-036 (Release No. 34-92713; File No. SR-FINRA-2021-010)
Dear Madam or Sir,
The Securities Industry and Financial Markets Association1 and its Asset Management Group2 jointly submit this response to the Commission’s consultation on FINRA’s Amendment No. 13 (“Amendment No. 1”) to its proposal4 (“the Original Proposal”) to amend the rules governing margin requirements for covered agency transactions. Together, SIFMA and SIFMA AMG members include many of the largest buy- and sell-side participants in the mortgage-backed securities markets covered by this rule and share a keen interest in the continued liquidity of these markets, which provide the funding for the majority of mortgage lending in the United States. SIFMA and SIFMA AMG each sent comment letters related to the Original Proposal.5,6
We appreciate FINRA’s response to several of our comments along with some of our requests for clarification of various provisions and terms.
We wish to jointly reiterate an important point made in each of our individual responses to the initial consultation – the need for a sufficient period for implementation of the amendments to 4210. In the Original Proposal, FINRA indicated that the effective date of the rule would be no more than 180 days
1 SIFMA is the voice of the U.S. securities industry. We represent the broker-dealers, banks and asset managers whose nearly 1 million
employees provide access to the capital markets, raising over $2.5 trillion for businesses and municipalities in the U.S., serving clients with over $18.5 trillion in assets and managing more than $67 trillion in assets for individual and institutional clients including mutual funds andretirement plans. SIFMA, with offices in New York and Washington, D.C., is the U.S. regional member of the Global Financial Markets Association (GFMA).
2 SIFMA AMG brings the asset management community together to provide views on U.S. and global policy and to create industry best
practices. SIFMA AMG’s members represent U.S. and global asset management firms whose combined assets under management exceed $45 trillion. The clients of SIFMA AMG member firms include, among others, tens of millions of individual investors, registered investmentcompanies, endowments, public and private pension funds, UCITS and private funds such as hedge funds and private equity funds. For more information, visit http://www.sifma.org/amg.
3 Available here: https://www.sec.gov/rules/sro/finra/2021/34-92713.pdf
4 Available here: https://www.federalregister.gov/documents/2021/05/25/2021-10959/self-regulatory-organizations-financial-industry regulatory-authority-inc-notice-of-filing-of-a
5 SIFMA broker-dealer letter: https://www.sifma.org/wp-content/uploads/2021/06/SIFMA-B-D-Comment-Letter-FINRA-4210-Proposal 2021.pdf
6 SIFMA AMG letter: https://www.sifma.org/wp-content/uploads/2021/06/AMG_4210_June2021.pdf