Swaps Regulation - End-User Exception to Mandatory Clearing - Comment Letter - Americans for Financial Reform - February 4, 2011
|Final Rule Issue||Effective Date||Compliance Date|
|July 19, 2012||September 17, 2012||April 10, 2013|
End-User Exception to Mandatory Clearing of Swaps
February 4, 2011
From the comment letter:
"AFR urges the SEC to require additional disclosures designed to provide a clear picture of financial risks associated with transactions believed to be eligible for the exception. The required 'Financial Obligation Notice' should be strengthened to require information about:
- the types of collateral provided by the end-user and the impact of posting collateral on the end-user’s ability to meet its financial obligations;
- whether the collateral requirements are unilateral or bilateral;
- contractual terms and whether they are triggered by changes in the credit-rating or other financial circumstances of either of the counterparties;
- whether any 'third-party' guarantor of the end-user’s obligations is a parent or affiliate of the person invoking the end-user exception; and
- the identity of any collateral agent, custodian or other entity involved in segregating collateral."
AFR also noted the importance of including small banks, savings associations, farm credit system institutions and credit unions in the swaps market participants required to clear.