[Federal Register Volume 77, Number 43 (Monday, March 5, 2012)]
[Notices]
[Pages 13164-13165]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-5207]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-66485; File No. SR-FICC-2012-01]


Self-Regulatory Organizations; Fixed Income Clearing Corporation; 
Notice of Filing of Proposed Rule Change To Make a Technical Correction 
to the Rule Relating to the Calculation of Funds-Only Settlement 
Amounts for Repo Brokers

February 28, 2012.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'') \1\ and Rule 19b-4 \2\ thereunder notice is hereby given that 
on February 14, 2012, the Fixed Income Clearing Corporation (``FICC'') 
filed with the Securities and Exchange Commission (``Commission'') the 
proposed rule change as described in Items I and II below, which Items 
have been prepared primarily by FICC. The Commission is publishing this 
notice to solicit comments on the proposed rule change from interested 
persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The proposed rule change consists of modifications to Rule 19, 
Section 4 of the rules of the Government Securities Division (``GSD'') 
of FICC.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, FICC included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. FICC has prepared summaries, set forth in sections A, B, 
and C below, of the most significant aspects of such statements.\3\
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    \3\ The Commission has modified the text of the summaries 
prepared by FICC.
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A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    The purpose of this filing is to make technical corrections to GSD 
Rule 19 (Special Provisions For Brokered Repo Transactions), Section 4 
(Calculations of Funds-Only Settlement Amounts for Repo Brokers) as 
described below. GSD Rule 19, Section 4 states that FICC may retain any 
amount of a Credit Forward Mark Adjustment Payment that is in excess of 
the Cap \4\ and that interest earned on such amount shall be paid to 
the Repo Broker on the subsequent business day. The second part of this 
sentence is incorrectly stated because FICC pays interest to those who 
were debited forward mark adjustment amounts not those who were 
credited such amounts. On the following day (i.e., the day after the 
broker received the Credit Forward Mark Adjustment Payment) when the 
broker is debited the interest for the use of funds it received as a 
credit, the broker will be debited the interest on the amount that it 
actually received as a credit (i.e., it will not be debited interest 
for the amount of Credit payment withheld above the Cap). The rule is 
also revised to state that Repo Brokers with more than one Segregated 
Repo Account must aggregate Debit Forward Mark Adjustments and Credit 
Forward Mark Adjustment Payments in those accounts for purposes of the 
Cap. The Repo Brokers currently comply with this correction and the 
revision reflects current practice.
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    \4\ The GSD rules define ``Cap'' as any Debit Forward Mark 
Adjustment Payment or Credit Forward Mark Adjustment Payment up to a 
dollar amount, as determined by FICC from time to time, that is 
automatically collected from or paid to the Repo Broker, as 
applicable.
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    FICC believes that the proposed rule change is consistent with 
Section 17A of the Act and the rules and regulations thereunder because 
it makes technical corrections to its rules to ensure that they are 
consistent and accurate.

B. Self-Regulatory Organization's Statement on Burden on Competition

    FICC does not believe that the proposed rule change will have any 
impact or impose any burden on competition.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    Written comments relating to the proposed rule change have not yet 
been solicited or received. FICC will notify the Commission of any 
written comments received by FICC.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Within 45 days of the date of publication of this notice in the 
Federal Register or within such longer period up to 90 days (i) as the 
Commission may designate if it finds such longer period to be 
appropriate and publishes its reasons for so finding or (ii) as to 
which the self- regulatory organization consents, the Commission will:
    (A) By order approve or disapprove the proposed rule change or
    (B) Institute proceedings to determine whether the proposed rule 
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-FICC-2012-01 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy, 
Secretary, Securities and Exchange Commission, 100 F Street NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-FICC-2012-01. This file 
number should be included on the subject line if email is used. To help 
the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all 
written statements with respect to the proposed rule change that are 
filed with the Commission, and all written communications relating to 
the proposed rule change between the Commission and any person, other 
than those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C. 552, will be available for Web site viewing and 
printing in the Commission's Public Reference Room, 100 F Street NE.,

[[Page 13165]]

Washington, DC 20549, on official business days between the hours of 10 
a.m. and 3 p.m. Copies of such filing also will be available for 
inspection and copying at FICC's principal office and on FICC's Web 
site at http://dtcc.com/downloads/legal/rule_filings/2012/ficc/SR_FICC_2012_01.pdf. All comments received will be posted without 
change; the Commission does not edit personal identifying information 
from submissions. You should submit only information that you wish to 
make available publicly.
    All submissions should refer to File Number SR-FICC-2012-01 and 
should be submitted on or before March 26, 2012.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\5\
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    \5\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-5207 Filed 3-2-12; 8:45 am]
BILLING CODE 8011-01-P