[Federal Register Volume 77, Number 191 (Tuesday, October 2, 2012)]
[Proposed Rules]
[Pages 60057-60059]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-24276]


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 Proposed Rules
                                                 Federal Register
 ________________________________________________________________________
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 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
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  Federal Register / Vol. 77, No. 191 / Tuesday, October 2, 2012 / 
Proposed Rules  

[[Page 60057]]



DEPARTMENT OF THE TREASURY

Office of the Comptroller of the Currency

12 CFR Part 45

[Docket No. OCC-2011-0008]
RIN 1557-AD43

BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM

12 CFR Part 237

[Docket No. R-1415]
RIN 7100 AD74

FEDERAL DEPOSIT INSURANCE CORPORATION

12 CFR Part 324

RIN 3064-AD79

FARM CREDIT ADMINISTRATION

12 CFR Part 624

RIN 3052-AC69

FEDERAL HOUSING FINANCE AGENCY

12 CFR Part 1221

RIN 2590-AA45


Margin and Capital Requirements for Covered Swap Entities; 
Reopening of Comment Period

AGENCY: Office of the Comptroller of the Currency, Treasury (OCC); 
Board of Governors of the Federal Reserve System (Board); Federal 
Deposit Insurance Corporation (FDIC); Farm Credit Administration (FCA); 
and the Federal Housing Finance Agency (FHFA).

ACTION: Reopening of comment period for proposed rule.

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SUMMARY: The OCC, Board, FDIC, FCA, and FHFA (collectively, the 
Agencies) are reopening the comment period for the proposed rule 
published in the Federal Register on May 11, 2011 (76 FR 27564) to 
establish minimum margin and capital requirements for uncleared swaps 
and security-based swaps entered into by swap dealers, major swap 
participants, security-based swap dealers, and major security-based 
swap participants for which one of the Agencies is the prudential 
regulator (Proposed Margin Rule). Reopening the comment period that 
expired on July 11, 2011 will allow interested persons additional time 
to analyze and comment on the Proposed Margin Rule in light of the 
consultative document on margin requirements for non-centrally-cleared 
derivatives recently published for comment by the Basel Committee on 
Banking Supervision (BCBS) and the International Organization of 
Securities Commissions (IOSCO).

DATES: Comments must be received on or before November 26, 2012.

ADDRESSES: Interested parties are encouraged to submit written comments 
jointly to all of the Agencies. Commenters are encouraged to use the 
title ``Margin and Capital Requirements for Covered Swap Entities'' to 
facilitate the organization and distribution of comments among the 
Agencies. Commenters are also encouraged to identify the number of the 
specific question for comment to which they are responding.
    Office of the Comptroller of the Currency: Because paper mail in 
the Washington, DC area and at the OCC is subject to delay, commenters 
are encouraged to submit comments by the Federal eRulemaking Portal or 
email, if possible. Please use the title ``Margin and Capital 
Requirements'' to facilitate the organization and distribution of the 
comments. You may submit comments by any of the following methods:
     Federal eRulemaking Portal--``Regulations.gov'': Go to 
http://www.regulations.gov. Select ``Document Type'' of ``Proposed 
Rules,'' and in the ``Enter Keyword or ID Box,'' enter Docket ID ``OCC-
2011-0008,'' and click ``Search.'' On ``View By Relevance'' tab at the 
bottom of screen, in the ``Agency'' column, locate the Proposed Rule 
for the OCC, in the ``Action'' column, click on ``Submit a Comment'' or 
``Open Docket Folder'' to submit or view public comments and to view 
supporting and related materials for this rulemaking action.
     Click on the ``Help'' tab on the Regulations.gov home page 
to get information on using Regulations.gov, including instructions for 
submitting or viewing public comments, viewing other supporting and 
related materials, and viewing the docket after the close of the 
comment period.
     Email: [email protected].
     Mail: Office of the Comptroller of the Currency, 250 E 
Street SW., Mail Stop 2-3, Washington, DC 20219.
     Fax: (202) 874-5274.
     Hand Delivery/Courier: 250 E Street SW., Mail Stop 2-3, 
Washington, DC 20219.
    Instructions: You must include ``OCC'' as the agency name and 
``Docket ID OCC-2011-0008'' in your comment. In general, OCC will enter 
all comments received into the docket and publish them on the 
Regulations.gov Web site without change, including any business or 
personal information that you provide such as name and address 
information, email addresses, or phone numbers. Comments received, 
including attachments and other supporting materials, are part of the 
public record and subject to public disclosure. Do not enclose any 
information in your comment or supporting materials that you consider 
confidential or inappropriate for public disclosure.
    You may review comments and other related materials that pertain to 
this proposed rulemaking by any of the following methods:
     Viewing Comments Electronically: Go to http://www.regulations.gov. Select ``Document Type'' of ``Public 
Submissions,'' and in the ``Enter Keyword or ID Box,'' enter Docket ID 
``OCC-2011-0008,'' and click ``Search.'' Comments will be listed under 
``View By Relevance'' tab at the bottom of screen. If comments from 
more than one agency are listed, the ``Agency'' column will indicate 
which comments were received by the OCC.
     Viewing Comments Personally: You may personally inspect 
and photocopy comments at the OCC, 250 E Street SW., Washington, DC 
20219. For security reasons, the OCC requires that visitors make an 
appointment to inspect comments. You may do so by calling (202) 874-
4700. Upon arrival, visitors will be required to present valid 
government-issued photo identification and submit to security screening 
in

[[Page 60058]]

order to inspect and photocopy comments.
     Docket: You may also view or request available background 
documents and project summaries using the methods described above.
    Board of Governors of the Federal Reserve System: You may submit 
comments, identified by Docket No. R-1415 and RIN 7100 AD74, by any of 
the following methods:
     Agency Web Site: http://www.federalreserve.gov. Follow the 
instructions for submitting comments at http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm.
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     Email: [email protected]. Include the 
docket number in the subject line of the message.
     Fax: (202) 452-3819 or (202) 452-3102.
     Mail: Address to Robert deV. Frierson, Secretary, Board of 
Governors of the Federal Reserve System, 20th Street and Constitution 
Avenue NW., Washington, DC 20551.
    All public comments will be made available on the Board's Web site 
at http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm as 
submitted, unless modified for technical reasons. Accordingly, comments 
will not be edited to remove any identifying or contact information. 
Public comments may also be viewed electronically or in paper in Room 
MP-500 of the Board's Martin Building (20th and C Streets NW.) between 
9:00 a.m. and 5:00 p.m. on weekdays.
    Federal Deposit Insurance Corporation: You may submit comments, 
identified by RIN3064 AD-79, by any of the following methods:
     Agency Web Site: http://www.fdic.gov/regulations/laws/federal/propose.html. Follow instructions for submitting comments on 
the Agency Web Site.
     Email: [email protected]. Include the RIN number on the 
subject line of the message.
     Mail: Robert E. Feldman, Executive Secretary, Attention: 
Comments, Federal Deposit Insurance Corporation, 550 17th Street NW., 
Washington, DC 20429.
     Hand Delivery: Comments may be hand delivered to the guard 
station at the rear of the 550 17th Street Building (located on F 
Street) on business days between 7:00 a.m. and 5:00 p.m.
    Instructions: All comments received must include the agency name 
and RIN for this rulemaking and will be posted without change to http://www.fdic.gov/regulations/laws/federal/propose.html, including any 
personal information provided.
    Farm Credit Administration: We offer a variety of methods for you 
to submit your comments. For accuracy and efficiency reasons, 
commenters are encouraged to submit comments by email or through the 
FCA's Web site. As facsimiles (fax) are difficult for us to process and 
achieve compliance with section 508 of the Rehabilitation Act, we are 
no longer accepting comments submitted by fax. Regardless of the method 
you use, please do not submit your comments multiple times via 
different methods. You may submit comments by any of the following 
methods:
     Email: Send us an email at [email protected].
     FCA Web site: http://www.fca.gov. Select ``Public 
Commenters,'' then ``Public Comments,'' and follow the directions for 
``Submitting a Comment.''
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     Mail: Gary K. Van Meter, Director, Office of Regulatory 
Policy, Farm Credit Administration, 1501 Farm Credit Drive, McLean, VA 
22102-5090.
    You may review copies of all comments we receive at our office in 
McLean, Virginia or on our Web site at http://www.fca.gov. Once you are 
in the Web site, select ``Public Commenters,'' then ``Public 
Comments,'' and follow the directions for ``Reading Submitted Public 
Comments.'' We will show your comments as submitted, including any 
supporting data provided, but for technical reasons we may omit items 
such as logos and special characters. Identifying information that you 
provide, such as phone numbers and addresses, will be publicly 
available. However, we will attempt to remove email addresses to help 
reduce Internet spam.
    Federal Housing Finance Agency: You may submit your written 
comments on the proposed rulemaking, identified by regulatory 
information number (RIN) 2590-AA45, by any of the following methods:
     Email: Comments to Alfred M. Pollard, General Counsel, may 
be sent by email at [email protected]. Please include ``RIN 2590-
AA45'' in the subject line of the message.
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments. If you submit your 
comment to the Federal eRulemaking Portal, please also send it by email 
to FHFA at [email protected] to ensure timely receipt by the Agency. 
Please include ``RIN 2590-AA45'' in the subject line of the message.
     U.S. Mail, United Parcel Service, Federal Express, or 
Other Mail Service: The mailing address for comments is: Alfred M. 
Pollard, General Counsel, Attention: Comments/RIN 2590-AA45, Federal 
Housing Finance Agency, Eighth Floor, 400 Seventh Street SW., 
Washington, DC 20024.
     Hand Delivery/Courier: The hand delivery address is: 
Alfred M. Pollard, General Counsel, Attention: Comments/RIN 2590-AA45, 
Federal Housing Finance Agency, Eighth Floor, 400 Seventh Street SW., 
Washington, DC 20024. The package should be logged at the Seventh 
Street entrance Guard Desk, First Floor, on business days between 9:00 
a.m. and 5:00 p.m.
    All comments received by the deadline will be posted for public 
inspection without change, including any personal information you 
provide, such as your name, address (mailing or email), and telephone 
numbers, on the FHFA Web site at http://www.fhfa.gov. Copies of all 
comments timely received will be available for public inspection and 
copying at the address above on government-business days between the 
hours of 10:00 a.m. and 3:00 p.m. To make an appointment to inspect 
comments please call the Office of General Counsel at (202) 649-3804.

FOR FURTHER INFORMATION CONTACT: 
    OCC: Jamey Basham, Assistant Director, Legislative and Regulatory 
Activities Division (202) 874-5090, Marvin Shaw, Counsel, Ron 
Shimabukuro, Senior Counsel, Legislative and Regulatory Activities 
Division (202) 874-5090, or Kurt Wilhelm, Director, Financial Markets 
Group (202) 874-4479, Office of the Comptroller of the Currency, 250 E 
Street SW., Washington, DC 20219.
    Board: Sean D. Campbell, Deputy Associate Director, Division of 
Research and Statistics, (202) 452-3761; Jordan Bleicher, Division of 
Banking Supervision and Regulation, (202) 973-6123; or Christopher M. 
Paridon, Counsel, (202) 452-3274 or Anna M. Harrington, Attorney, (202) 
452-6406, Legal Division, Board of Governors of the Federal Reserve 
System, 20th and C Streets NW., Washington, DC 20551.
    FDIC: Bobby R. Bean, Associate Director, Capital Market Branch, 
(202) 898-6705, John Feid, Senior Policy Analyst, (202) 898-8649, 
Division of Risk Management Supervision, Thomas F. Hearn, Counsel, 
(202) 898-6967, or Ryan K. Clougherty, Senior Attorney, (202) 898-3843, 
Legal Division, Federal Deposit Insurance Corporation, 550 17th Street 
NW., Washington, DC 20429.

[[Page 60059]]

    FCA: William G. Dunn, Acting Associate Director, Finance and 
Capital Markets Team, Office of Regulatory Policy, Farm Credit 
Administration, McLean, VA 22102-5090, (703) 883-4414, TTY (703) 883-
4434, Joseph T. Connor, Associate Director for Policy and Analysis, 
Office of Secondary Market Oversight, Farm Credit Administration, 
McLean, VA 22102-5090, (703) 883-4280, TTY (703) 883-4434, or Rebecca 
S. Orlich, Senior Counsel, Office of General Counsel, Farm Credit 
Administration, McLean, VA 22102-5090, (703) 883-4020, TTY (703) 883-
4020.
    FHFA: Robert Collender, Principal Policy Analyst, Office of Policy 
Analysis and Research, (202) 649-3196, [email protected], or 
Peggy Balsawer, Assistant General Counsel, Office of General Counsel, 
(202) 649-3060, [email protected], (not toll-free numbers), 
Federal Housing Finance Agency, 400 Seventh Street SW., Washington, DC 
20024. The telephone number for the Telecommunications Device for the 
Hearing Impaired is (800) 877-8339.

SUPPLEMENTARY INFORMATION:

I. Background

    On May 11, 2011, the Agencies published in the Federal Register a 
notice of proposed rulemaking that would establish minimum margin and 
capital requirements for registered swap dealers, major swap 
participants, security-based swap dealers, and major security-based 
swap participants for which one of the Agencies is the prudential 
regulator, as required under sections 731 and 764 of the Dodd-Frank 
Wall Street Reform and Consumer Protection Act (the ``Dodd-Frank 
Act'').\1\ Sections 731 and 764 of the Dodd-Frank Act add a new section 
4s to the Commodity Exchange Act and a new section 15F to the 
Securities Exchange Act of 1934, respectively, which require the 
registration and regulation of swap dealers and major swap participants 
and security-based swap dealers and major security-based swap 
participants (collectively, swap entities). For certain types of swap 
entities that are prudentially regulated by one of the Agencies, 
sections 731 and 764 of the Dodd-Frank Act require the Agencies to 
adopt rules jointly for swap entities under their respective 
jurisdictions imposing: (i) Capital requirements and (ii) initial and 
variation margin requirements on all non-cleared swaps and non-cleared 
security-based swaps.\2\
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    \1\ Dodd-Frank Wall Street Reform and Consumer Protection Act, 
Public Law 111-203, 124 Stat. 1376 (2010).
    \2\ Sections 731 and 764 of the Dodd-Frank Act also require the 
Commodity Futures Trading Commission (``CFTC'') and Securities and 
Exchange Commission (``SEC'') to separately adopt rules imposing 
capital and margin requirements for swap entities for which there is 
no prudential regulator. See 7 U.S.C. 6s(e)(2)(B); 15 U.S.C. 78o-
8(e)(2)(B). The Dodd-Frank Act requires the CFTC, SEC, and the 
Agencies to establish and maintain, to the maximum extent 
practicable, capital and margin requirements that are comparable, 
and to consult with each other periodically (but no less than 
annually) regarding these requirements. See 7 U.S.C. 6s(e)(2)(A); 
6s(e)(3)(D); 15 U.S.C. 78o-8(e)(2)(A), 78o-8(e)(3)(D). Staff of the 
Agencies consulted with staff of the CFTC and SEC in developing the 
proposed rule.
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II. Reopening of Comment Period and Request for Comment

    The original comment period to the Proposed Margin Rule closed on 
June 24, 2011.\3\ In order to allow interested persons additional time 
to analyze the proposed rule and prepare their comments, the Agencies 
extended the comment period until July 11, 2011.\4\ In the Proposed 
Margin Rule, the Agencies noted that applying the proposed margin 
requirements to transactions involving foreign swap entities or foreign 
counterparties could subject those transactions to multiple, and 
potentially conflicting, margin requirements established by U.S. and 
foreign regulators and could raise questions of competitive equality 
among U.S. and foreign firms. Margin standards that are developed and 
harmonized on an international basis could help address those issues.
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    \3\ See 76 FR 27564 (May 11, 2011).
    \4\ See 76 FR 37029 (June 24, 2011).
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    In October 2011, the BCBS and IOSCO established a Working Group on 
Margin Requirements to develop harmonized international margin 
standards for non-cleared swaps. On July 6, 2012, BCBS and IOSCO 
published a Consultative Document entitled ``Margin requirements for 
non-centrally-cleared derivatives'' (Consultative Document) that 
outlines possible margin requirements for non-centrally-cleared 
derivatives.\5\ The Consultative Document addresses a number of topics, 
including: (i) The instruments that would be subject to margin 
requirements; (ii) the market participants that would be subject to 
margin requirements; (iii) initial margin and variation margin 
methodology; (iv) eligible collateral; (v) treatment of provided 
margin; (vi) treatment of inter-affiliate transactions; and (vii) 
treatment of cross-border transactions.
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    \5\ See BCBS and IOSCO, Margin requirements for non-centrally-
cleared derivatives (July 6, 2012), available at www.bis.org/publ/bcbs226.pdf.
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    BCBS and IOSCO are requesting comment on the initial proposals set 
forth in the Consultative Document by September 28, 2012. It is 
expected that, after reviewing and evaluating any comments received, 
the BCBS and IOSCO will issue final policy recommendations for margin 
requirements for non-centrally-cleared derivatives. As part of the 
international efforts to implement consistent global standards for non-
centrally-cleared derivatives, the Agencies intend to consider the 
final policy recommendations set forth by the BCBS and IOSCO when 
adopting final U.S. rules for margin for non-cleared swaps.
    Accordingly, the Agencies believe it is appropriate to reopen the 
comment period for the Proposed Margin Rule in order to give interested 
persons additional time to analyze the Proposed Margin Rule in light of 
the Consultative Document and an opportunity to comment on the 
Consultative Document and Proposed Margin Rule concurrently.\6\
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    \6\ On July 12, 2012, the CFTC reopened the comment period on 
its proposed margin rule under section 731 and 764 of the Dodd-Frank 
Act. See 76 FR 41109 (July 12, 2012).
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    Therefore, the Agencies are reopening the comment period until 
November 26, 2012, for all aspects of the Proposed Margin Rule.

    Dated: September 25, 2012.
Thomas Curry,
Comptroller of the Currency.

    By order of the Board of Governors of the Federal Reserve 
System, acting through the Secretary under delegated authority, 
September 18, 2012.
Robert deV. Frierson,
Secretary of the Board.


    Dated at Washington, DC, this 29th of August 2012.

Federal Deposit Insurance Corporation.
Valerie J. Best,
Assistant Executive Secretary.

    Dated: September 7, 2012.
Dale L. Aultman,
Secretary, Farm Credit Administration Board.

    Dated: September 5, 2012.
 Edward J. DeMarco,
 Acting Director, Federal Housing Finance Agency.
[FR Doc. 2012-24276 Filed 10-1-12; 8:45 am]
BILLING CODE 4810-33-8070-01-P;6705-01-P;6714-01-P;6210-01-P;4810-33-P