[Federal Register Volume 59, Number 250 (Friday, December 30, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-32155]


[[Page Unknown]]

[Federal Register: December 30, 1994]


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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-35132; File Nos. 600-19 and 600-22]

 

Self-Regulatory Organizations; MBS Clearing Corporation; Order 
Granting Approval of Application for Extension of Temporary 
Registration as a Clearing Agency

    On November 7, 1994, the MBS Clearing Corporation (``MBS'') filed 
with the Securities and Exchange Commission (``Commission''), pursuant 
to Section 19(a) of the Securities Exchange Act of 1934 (``Act''),\1\ a 
request for extension of its registration as a clearing agency under 
Section 17A of the Act for a period of eighteen months.\2\ Notice of 
MBS's request for extension of temporary registration appeared in the 
Federal Register on November 16, 1994.\3\ This order approves MBS's 
request for extension of temporary registration as a clearing agency 
through June 30, 1996.
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    \1\15 U.S.C. 78s(a) (1988).
    \2\Letter from David T. Rusoff, Foley & Lardner, to Ari 
Burstein, Attorney, Division of Market Regulation, Commission, 
(November 7, 1994).
    MBS filed with the Commission an amendment to its Form CA-1 
dated August 15, 1994, which was considered in connection with this 
extension of MBS's temporary registration.
    \3\Securities Exchange Act Release No. 34948 (November 8, 1994), 
59 FR 59263.
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    On February 2, 1987, the Commission granted the application of MBS 
for registration as a clearing agency pursuant to Sections 17A(b) and 
19(a)(1) of the Act\4\ and Rule 17Ab2-1(c)\5\ thereunder on a temporary 
basis for a period of eighteen months.\6\ Subsequently, the Commission 
issued orders that extended MBS's temporary registration as a clearing 
agency with the last order extending MBS's registration through 
December 31, 1994.\7\
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    \4\15 U.S.C. 78q-1(b) and 78s(a)(1) (1988).
    \5\17 CFR 240.17Ab2-1(c) (1994).
    \6\Securities Exchange Act Release No. 24046 (February 2, 1987), 
52 FR 4218 (order granting MBS registration as a clearing agency for 
a period not to exceed eighteen months).
    \7\Securities Exchange Act Release Nos. 25957 (August 2, 1988), 
53 FR 29537; 27079 (July 31, 1989), 54 FR 32412; 28492 (September 
28, 1990), 55 FR 41148; 29751 (September 27, 1991), 56 FR 50602; 
31750 (January 21, 1993), 58 FR 6424; and 33348 (December 15, 1993), 
58 FR 68183.
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    Since the last order extending MBS's temporary registration, the 
Chicago Stock Exchange, MBS's parent corporation, sold their entire 
interest in MBS to MBS participants and the National Securities 
Clearing Corporation (``NSCC''). The Commission issued a no-action 
letter to MBS in connection with the sale stating that the new MBS that 
resulted after the sale can rely upon MBS's current clearing agency 
registration.\8\ The amended Form CA-1 considered in connection with 
this extension of temporary registration corrected any information that 
became inaccurate or incomplete as a result of MBS's sale.
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    \8\Letter from Jerry W. Carpenter, Assistant Director, Division 
of Market Regulation, Commission, to J. Craig Long, Foley & Lardner 
(August 5, 1994).
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    As discussed in detail in the original order granting MBS's 
registration, one of the primary reasons for MBS's registration was to 
enable it to provide for the safe and efficient clearance and 
settlement of transactions in mortgage-backed securities. Since the 
original temporary registration order, MBS has implemented several 
improvements to its operating and financial standards and continues to 
work towards enhancing the safety and efficiency of its operations. In 
addition, MBS has made significant progress towards implementation of a 
fully operational off-site backup system. Specifically, MBS recently 
entered into a facilities management agreement with the Securities 
Industry Automation Corporation (``SIAC'') to provide, among other 
things, data processing support for MBS. The conversion to SIAC is 
intended to facilitate the establishment of a fully operational off-
site backup system.
    MBS has functioned effectively as a registered clearing agency for 
over seven years. Accordingly, in light of the past performance of MBS 
and the need for MBS to provide continuity of service to its 
participants, the Commission believes that, pursuant to Section 
17A(b)(2) of the Act, it is necessary and appropriate in the public 
interest and for the prompt and accurate clearance and settlement of 
securities transactions to approve MBS's request to extend its 
registration through June 30, 1996. Any comments received concerning 
MBS's amended application will be considered in conjunction with the 
Commission's consideration of whether to grant MBS permanent 
registration as a clearing agency under Section 17A(b) of the Act.\9\
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    \9\15 U.S.C. 78q-1(b) (1988).
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    It is therefore ordered, That MBS's registration as a clearing 
agency be and hereby is approved on a temporary basis through June 30, 
1996.

    For the Commission, by the Division of Market Regulation 
pursuant to delegated authority.\10\
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    \10\17 CFR 200.30-3(a)(50) (1994).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 94-32155 Filed 12-29-94; 8:45 am]
BILLING CODE 8010-01-M