Featured Product

    CFTC Letter Clarifies Reporting Requirements for Bank Swap Dealers

    August 31, 2021

    The Market Participants Division of the Commodity Futures Trading Commission (CFTC) issued a letter on the capital and financial reporting obligations for swap dealers subject to capital requirements of a prudential regulator under the swap dealers financial reporting rules of CFTC. The letter states that, in lieu of complying with the financial reporting requirements of CFTC and subject to certain specified conditions, bank swap dealers may report utilizing certain alternative forms, filing deadlines, and/or reporting standards that are otherwise applicable to them by their prudential or home-country regulators. The relief granted by the letter would expire on the earlier of October 06, 2023 or on the adoption, by CFTC, of any revised financial reporting and notification requirements applicable to such bank swap dealers.

    The CFTC staff determined that providing the conditional relief on a temporary basis would not adversely impact the ability to monitor the capital position of bank swap dealers to the extent of its obligation under the Commodity Exchange Act and CFTC regulations. The letter was issued in response to a joint request received from the Securities Industry and Financial Markets Association and the International Swaps and Derivatives Association (ISDA) on behalf of their swap dealers members who are otherwise required to comply, by October 06, 2021, with the newly adopted capital and financial reporting requirements of CFTC. In their letter, they requested confirmation that the Market Participants Division of CFTC will not recommend an enforcement action if certain swap dealers subject to capital requirements of a prudential regulator fail to comply with financial reporting requirements set forth in Commission regulation. 

    In this recently published letter, the Market Participants Division of CFTC states that it will not recommend that CFTC take an enforcement action against a bank swap dealer for failure to comply with certain financial reporting requirements if:

    • A bank swap dealer that files a Call Report with its applicable U.S. prudential regulator files the Schedule RC—Balance Sheet and the Schedule RC-R—Regulatory Capital from the Call Report, and Schedule 1 from Appendix C to Subpart E of Part 23 of CFTC's regulations, with CFTC on a quarterly basis in lieu of the Balance Sheet and Statement of Regulatory Capital required under Appendix C, provided that the bank swap dealer files the above schedules with CFTC within the timeframe permitted by its applicable prudential regulator to file its Call Report. 
    • A covered non-U.S. bank swap dealer that does not file a Call Report with a U.S. prudential regulator files a statement of financial condition and a statement of regulatory capital in lieu of the Balance Sheet and Statement of Regulatory Capital required under Appendix C, provided that the statements filed with CFTC contain comparable financial information to the information contained in the Balance Sheet and Statement of Regulatory Capital, and such statements are filed with the covered non-U.S. bank swap dealers home country regulator; and include Schedule 1 of Appendix C with its balance sheet and statement of regulatory capital when filed with CFTC.
    • A covered non-U.S. bank swap dealer that prepares and presents the statement of financial condition, the statement of regulatory capital, and Schedule 1 in accordance with the accounting standards permitted by its applicable home-country regulator, including the accounting principles established in its home jurisdiction, provided the statement of financial condition, statement of regulatory capital, and Schedule 1 are submitted to CFTC in the English language, with balances converted to USD.
    • A covered non-U.S. bank swap dealer files the statement of financial condition, statement of regulatory capital, and Schedule 1 within 15 days of the earlier of the date such financial statements are filed with its home-country regulator or the date such financial statements are required to be filed with its home country regulator. A covered non-U.S. bank swap dealer is required to file the financial statements and Schedule 1 with CFTC as of the end of each quarter, unless the covered non-U.S. bank swap dealer is only required to file such financial statements with its home-country regulator on a semi-annual basis, in which case its financial statements and Schedule 1 must be filed with CFTC on a semi-annual basis.
    • A covered non-U.S. bank swap dealer that is dually registered with the U.S. Securities and Exchange Commission (SEC) as security-based swap dealer files a FOCUS Report Part IIC, or other SEC approved financial reports and schedules, with CFTC in lieu of its reporting obligation under Regulation 23.105(p)(2), provided that the FOCUS Report Part IIC, or other SEC-approved financial reports and schedules, are filed with CFTC on the earlier of the due date for the reports under the SEC rules, or the date the reports were filed with the SEC. The FOCUS Report Part IIC or other SEC-approved financial reports and schedules must be filed with CFTC in the English language with balances converted to USD.

    Keywords: Americas, US, Banking, Reporting, Call Reports, Regulatory Capital, Basel, Swaps, Bank Swap Dealers, ISDA, CFTC

    Featured Experts
    Related Articles
    News

    APRA Publishes Results of Climate Risk Self-Assessment Survey

    The Australian Prudential Regulation Authority (APRA) has published the findings of its latest climate risk self-assessment survey conducted across the banking, insurance, and superannuation industries.

    August 04, 2022 WebPage Regulatory News
    News

    ACPR Publishes Updates Related to CRD IV and Covered Bonds

    The French Prudential Supervisory Authority (ACPR) published a notice related to the methods for calculating and publishing prudential ratios under the Capital Requirements Directive (CRD IV) and the minimum requirement for own funds and eligible liabilities (MREL).

    August 03, 2022 WebPage Regulatory News
    News

    BIS Paper Contributes to Debate on Regulating NBFIs and Big Techs

    The Financial Stability Institute (FSI) of the Bank for International Settlements recently published a paper proposing a framework for classifying financial stability regulation as either entity-based or activity-based.

    August 03, 2022 WebPage Regulatory News
    News

    EIOPA Publishes Guidance on Climate Change Scenarios in ORSA

    The European Insurance and Occupational Pension Authority (EIOPA) published the risk dashboard based on Solvency II data and the final version of the application guidance on climate change materiality assessments and climate change scenarios in the Own Risk and Solvency Assessment (ORSA).

    August 02, 2022 WebPage Regulatory News
    News

    EBA and ECB Respond to Proposals on Sustainability Disclosures

    The European Banking Authority (EBA) and the European Central Bank (ECB) published their responses to the consultations of the International Sustainability Standards Board (ISSB) and the European Financial Reporting Advisory Group (EFRAG) on sustainability-related disclosure standards.

    August 01, 2022 WebPage Regulatory News
    News

    BIS Report Notes Existing Gaps in Climate Risk Data at Central Banks

    A Consultative Group on Risk Management (CGRM) at the Bank for International Settlements (BIS) published a report that examines incorporation of climate risks into the international reserve management framework.

    July 29, 2022 WebPage Regulatory News
    News

    EBA Publishes Multiple Regulatory Updates for Regulated Entities

    The European Banking Authority (EBA) published the final guidelines on liquidity requirements exemption for investment firms, updated version of its 5.2 filing rules document for supervisory reporting, and Single Rulebook Question and Answer (Q&A) updates in July 2022.

    July 29, 2022 WebPage Regulatory News
    News

    EIOPA Issues SII Taxonomy and Guide on Sustainability Preferences

    The European Insurance and Occupational Pensions Authority (EIOPA) published Version 2.8.0 of the Solvency II data point model (DPM) and XBRL taxonomy.

    July 29, 2022 WebPage Regulatory News
    News

    EESC Opines on Proposals on CRR and European Single Access Point

    The European Union published, in the Official Journal of the European Union, an opinion from the European Economic and Social Committee (EESC); the opinion is on the proposal for a regulation to amend the Capital Requirements Regulation (CRR).

    July 29, 2022 WebPage Regulatory News
    News

    HM Treasury Publishes Multiple Regulatory Updates in July 2022

    HM Treasury published a draft statutory instrument titled “The Financial Services (Miscellaneous Amendments) (EU Exit) Regulations 2022,” along with the related explanatory memorandum and impact assessment.

    July 29, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8423