82 FR 21850 - Self-Regulatory Organizations; The Depository Trust Company; National Securities Clearing Corporation; Notice of Filing of and No Objection To Advance Notices, as Modified by Amendments No. 1, To Renew the Credit Facility
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 82, Issue 89 (May 10, 2017)
Federal Register Volume 82, Issue 89 (May 10, 2017)
| Page Range | 21850-21854 | |
| FR Document | 2017-09459 |
[Federal Register Volume 82, Number 89 (Wednesday, May 10, 2017)] [Notices] [Pages 21850-21854] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2017-09459] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-80605; File Nos. SR-DTC-2017-802; SR-NSCC-2017-802] Self-Regulatory Organizations; The Depository Trust Company; National Securities Clearing Corporation; Notice of Filing of and No Objection To Advance Notices, as Modified by Amendments No. 1, To Renew the Credit Facility May 5, 2017. Pursuant to Section 806(e)(1) of Title VIII of the Dodd-Frank Wall Street Reform and Consumer Protection Act entitled the Payment, Clearing, and Settlement Supervision Act of 2010 (``Clearing Supervision Act'') \1\ and Rule 19b-4(n)(1)(i) under the Securities Exchange Act of 1934 (``Act''),\2\ notice is hereby given that on April 4, 2017 The Depository Trust Company (``DTC'') and National Securities Clearing Corporation (``NSCC,'' together with DTC, ``Clearing Agencies'') filed with the Securities and Exchange Commission (``Commission'') the advance notices SR-DTC-2017-802 and SR-NSCC-2017- 802. On May 1, 2017, the Clearing Agencies filed Amendments No. 1 to the advance notices.\3\ The advance notices, as modified by Amendments No. 1 (hereinafter, collectively ``Advance Notices''), are described in Items I, II and III below, which Items have been prepared primarily by the Clearing Agencies. The Commission is publishing this notice to solicit comments on the Advance Notices from interested persons and providing notice that the Commission does not object to the Advance Notices. --------------------------------------------------------------------------- \1\ 12 U.S.C. 5465(e)(1). \2\ 17 CFR 240.19b-4(n)(1)(i). \3\ In Amendments No. 1 to the advance notices, the Clearing Agencies request Commission approval to (i) accept $14.075 billion in aggregate commitments for this year's facility, and (ii) clarify that for future renewals of the credit facility, the Clearing Agencies may accept, not just seek, an aggregate commitment amount within 15 percent of $14 billion, as discussed below. --------------------------------------------------------------------------- I. Clearing Agencies' Statement of the Terms of Substance of the Advance Notices These Advance Notices are filed by the Clearing Agencies in connection with their proposals to (1) renew (``Renewal'') their 364- day committed revolving credit facility (``Credit Facility''), described below, and (2) make annual renewals of the Credit Facility on substantially similar terms and conditions (``Future Renewals''), also described below, as described in greater detail below.\4\ --------------------------------------------------------------------------- \4\ Terms not defined herein are defined in the Terms not defined herein are defined in the Rules, By-Laws and Organization Certificate of DTC, available at http://www.dtcc.com/~/media/Files/ Downloads/legal/rules/dtc_rules.pdf; or Rules and Procedures of NSCC (``Rules''), available at http://www.dtcc.com/~/media/Files/ Downloads/legal/rules/nscc_rules.pdf. --------------------------------------------------------------------------- II. Clearing Agencies' Statement of the Purpose of, and Statutory Basis for, the Advance Notices In their filings with the Commission, the Clearing Agencies included statements concerning the purpose of and basis for the Advance Notices and discussed any comments they received on the Advance Notices. The text of these statements may be examined at the places specified in Item IV below. The Clearing Agencies have prepared summaries, set forth in sections A and B below, of the most significant aspects of such statements. (A) Clearing Agencies' Statement on Comments on the Advance Notices Received From Members, Participants, or Others The Clearing Agencies have not solicited or received any written comments relating to these proposals. The Clearing Agencies will notify the Commission of any written comments received by the Clearing Agencies. (B) Advance Notices Filed Pursuant to Section 806(e) of the Payment, Clearing and Settlement Supervision Act Description of the Proposals Renewal. As part of their liquidity risk management regime, the Clearing Agencies maintain a 364-day committed revolving line of credit with a syndicate of commercial lenders, which is renewed every year. The terms and conditions of the current Renewal would be specified in the Sixteenth Amended and Restated Revolving Credit Agreement, to be dated as of May 9, 2017 (``Renewal Agreement''), among the Clearing Agencies,\5\ the lenders party thereto, the administrative agent and the collateral agent. Such terms and conditions are substantially the same as the terms and conditions of the existing credit agreement, dated as of May 10, 2016, as heretofore amended (``Existing Agreement''),\6\ except that pricing \7\ and the amount of the aggregate commitment for NSCC may change. The substantive terms of the Renewal Agreement are set forth in the Summary of Indicative Principal Terms and Conditions, dated March 30, 2017, which is not a public document. The aggregate commitments being sought under the Renewal would be for an amount up to $14 billion for NSCC and DTC together, of which all but $1.9 billion commitment would be the [[Page 21851]] aggregate commitment to NSCC as borrower, as provided in the Existing Agreement; however, the Clearing Agencies may, subject to obtaining all proper internal approvals, accept aggregate commitments under the Renewal up to $14.075 billion. --------------------------------------------------------------------------- \5\ The Renewal Agreement would provide for both DTC and NSCC as borrowers, with an aggregate commitment of $1.9 billion for DTC and the amount of any excess aggregate commitment for NSCC. The borrowers are not jointly and severally liable and each lender has a ratable commitment to each borrower. DTC and NSCC provide separate collateral to secure their respective borrowings. \6\ See Securities Exchange Act Release No. 77750 (April 29, 2016), 81 FR 27181 (May 5, 2016) (SR-DTC-2017-801; SR-NSCC-2016- 801). \7\ ``Pricing'' of the Credit Facility refers to the charges and fees owed by the borrowers to the agents and lenders thereto with respect to the services performed by the agents, the commitment to lend and the rate of interest applicable to any borrowing under the Credit Facility, among other such matters. --------------------------------------------------------------------------- Future Renewals. The Clearing Agencies expect to continue to renew the Credit Facility annually on substantially similar terms and conditions as the Renewal. The terms and conditions of all Future Renewals would be specified in subsequent credit agreements among the Clearing Agencies, the lenders party thereto, the administrative agent and the collateral agent. In connection with all Future Renewals, the Clearing Agencies would not make changes to (a) the amount of aggregate commitment being sought for or accepted by DTC, which would continue to be $1.9 billion; (b) the financial institution acting as administrative agent; or (c) the commitment period, which would continue to be for 364 days. However, in connection with all Future Renewals, the Clearing Agencies may consider changes to (1) the amount of aggregate commitment being sought for and accepted by NSCC, so long as such amounts do not vary more than 15 percent either above or below the amount of aggregate commitment being sought by NSCC under the Renewal being proposed by this Advance Notice, which would be no less than $10.285 billion and no more than $13.915 billion; \8\ (2) the syndicate, so long as all lenders party to future Credit Facilities are subject to the same credit review as those lenders party to the Renewal; (3) pricing and collateral haircuts,\9\ so long as such terms are consistent with the then current market practice; or (4) representations, warranties, covenants, and terms of events of default,\10\ so long as any modifications are immaterial to the Clearing Agencies as a borrower and do not impair the Clearing Agencies' ability to borrow under the line of credit. The Clearing Agencies would not consider such changes as materially altering the terms and conditions of the Credit Facility. --------------------------------------------------------------------------- \8\ NSCC believes that, given the average size of the commitments for NSCC in past Credit Facilities, a difference of no more than 15 percent, either above or below the aggregate NSCC commitment of the Renewal would not be a material change. \9\ ``Collateral haircuts'' with respect to the collateral for any borrowing under the Credit Facility refers to the schedule of percentages of market value, by type of collateral, determining the collateral value of that type of collateral, for purposes of securing a borrowing under the Credit Facility. \10\ ``Events of default'' under the Credit Facility refers to those events or conditions which trigger or constitute a default of the borrowers under the agreement (e.g., a breach of terms or conditions or a failure to perform an obligation). --------------------------------------------------------------------------- So long as the Clearing Agencies do not make changes to the terms described in items (a), (b), and (c) above in any Future Renewal, and so long as any Future Renewal adheres to the conditions described in items (1) through (4) above, the Clearing Agencies would consider such Future Renewal as being on substantially the same terms and conditions as the Renewal and predecessor agreements such that it would not need to be subject to the requirement to file an advance notice filing pursuant to Section 806(e)(1) of the Clearing Supervision Act.\11\ In the event that any annual renewal of the Credit Facility is not on terms and conditions that are substantially similar to the Renewal, as specified in the paragraphs above, such renewal would be subject to an advance notice filing pursuant to Section 806(e)(1) of the Clearing Supervision Act. If the Clearing Agencies determine to address future renewals in such filing, it would include in that filing the proposed conditions to the terms of any subsequent renewals. --------------------------------------------------------------------------- \11\ 12 U.S.C. 5465(e)(1). --------------------------------------------------------------------------- Expected Effect on Risks to the Clearing Agencies, Their Participants and the Market The Renewal and Future Renewals would continue to promote the reduction of liquidity risk to the Clearing Agencies, DTC's Participants, NSCC's Members (collectively, ``Members''), and the securities market in general because they would help the Clearing Agencies maintain sufficient liquidity resources to timely meet their settlement obligations with a high degree of confidence. The Renewal Agreement and its substantially similar predecessor agreements have been in place since the introduction of same day funds settlement at the Clearing Agencies, and the Clearing Agencies expect to continue to renew the Credit Facility annually pursuant to Future Renewals. Management of Identified Risks The Clearing Agencies require same day liquidity resources to cover the failure-to-settle of their Member, or affiliated family of Members, with the largest aggregate liquidity exposure. If a Member defaults on its end-of-day net settlement obligation, the Clearing Agencies may borrow under the Credit Facility to enable them, if necessary, to fund settlement among non-defaulting Members, including settlement of guaranteed trades due to settle. Any NSCC borrowing would be secured principally by (i) securities deposited by NSCC Members in NSCC's Clearing Fund \12\ (i.e., the Eligible Clearing Fund Securities, as defined in NSCC's Rules, pledged by Members to NSCC in lieu of cash Clearing Fund deposits) and (ii) securities cleared through NSCC's Continuous Net Settlement System that were intended for delivery to the defaulting Member upon payment of its net settlement obligation. In addition to the Credit Facility and the Clearing Fund, NSCC has diversified its liquidity resources by implementing a commercial paper and extendible-term note facility.\13\ Any DTC borrowing would be secured principally by (i) securities that were intended to be delivered to the defaulting DTC Participant upon payment of its net settlement obligation and (ii) securities previously designated by the defaulting Participant as collateral. --------------------------------------------------------------------------- \12\ NSCC's Clearing Fund (which operates as its default fund) addresses potential exposure through a number of risk-based component charges calculated and assessed daily and includes additional liquidity deposits by certain NSCC Members pursuant to NSCC's Supplemental Liquidity Deposits rule (NSCC's Rule 4(A)). Supra, note 3. \13\ See Securities Exchange Act Release No. 75730 (August 19, 2015), 80 FR 51638 (August 25, 2015) (SR-NSCC-2015-802). --------------------------------------------------------------------------- As integral parts of NSCC's risk management structure, the Credit Facility, the commercial paper and extendible-term note facility, and the Clearing Fund, together, provide NSCC liquidity to complete end-of- day net funds settlement. The Credit Facility is built into DTC's primary risk management controls, the Net Debit Cap \14\ and Collateral Monitor,\15\ which together require that [[Page 21852]] the end-of-day net funds settlement obligation of a DTC Participant cannot exceed DTC's liquidity resources and is fully collateralized. --------------------------------------------------------------------------- \14\ The Net Debit Cap risk control is designed so that DTC may complete settlement among non-defaulting DTC Participants, even if the Participant or affiliated family of Participants with the largest settlement obligation that day fails to settle. Before completing a transaction in which a Participant is the receiver, DTC calculates the effect the transaction would have on such Participant's Settlement Account, and determines whether any resulting Net Debit Balance would exceed the Participant's Net Debit Cap. Any transaction that would cause the Net Debit Balance to exceed the Net Debit Cap is placed on a pending (recycling) queue until the Net Debit Cap will not be exceeded by processing the transaction. \15\ DTC tracks Collateral in a DTC Participant's account through the Collateral Monitor. At all times, the Collateral Monitor reflects the amount by which the Collateral Value in the account exceeds the Net Debit Balance in the account. When processing a transaction, DTC verifies that the Collateral Monitor of each of the deliverer and receiver will not become negative when the transaction is processed. If the transaction would cause either party's Settlement Account to have insufficient collateral to support its net settlement obligation, the transaction will recycle until the deficient account has sufficient Collateral to proceed or until the applicable cutoff time occurs. --------------------------------------------------------------------------- The Credit Facility is a cornerstone of the Clearing Agencies' risk management and both the Renewal and Future Renewals are critical to the Clearing Agencies' risk management infrastructure. Because the Renewal would preserve substantially similar terms and conditions to the Existing Agreement, and Future Renewals would preserve substantially similar terms and conditions to the Renewal Agreement, the Clearing Agencies believe that the Renewal and Future Renewals would not otherwise affect or alter the management of risk at the Clearing Agencies. Consistency With the Clearing Supervision Act The Clearing Agencies believe the Renewal and Future Renewals are consistent with Section 805(b) of the Clearing Supervision Act.\16\ The objectives and principles of Section 805(b) of the Clearing Supervision Act are the promotion of robust risk management, promotion of safety and soundness, reduction of systemic risks, and support of the stability of the broader financial system.\17\ The Clearing Agencies believe that the Renewal and Future Renewals would promote these objectives and principles because they would provide the Clearing Agencies with a continuing source of committed liquidity to meet its settlement obligations and thus mitigate the Clearing Agencies' liquidity risk. Therefore, the Clearing Agencies believe the Renewal and Future Renewals are consistent with Section 805(b) of the Clearing Supervision Act.\18\ --------------------------------------------------------------------------- \16\ 12 U.S.C. 5464(b). \17\ Id. \18\ Id. --------------------------------------------------------------------------- The Clearing Agencies believe the Renewal and Future Renewals are also consistent with Rule 17Ad-22(b)(3),\19\ Rule 17Ad-22(d)(11),\20\ and Rule 17Ad-22(e)(7) under the Act.\21\ --------------------------------------------------------------------------- \19\ 17 CFR 240.17Ad-22(b)(3). \20\ 17 CFR 240.17Ad-22(d)(11). \21\ 17 CFR 240.17Ad-22(e)(7). The Commission adopted amendments to Rule 17Ad-22, including the addition of new section 17Ad-22(e), on September 28, 2016. See Securities Exchange Act Release No. 78961 (September 28, 2016), 81 FR 70786 (October 13, 2016) (S7-03-14). NSCC and DTC are ``covered clearing agencies'' as defined by new Rule 17Ad-22(a)(5) and must comply with new subsection (e) of Rule 17Ad-22 by April 11, 2017. --------------------------------------------------------------------------- Rule 17Ad-22(b)(3) requires, in part, that central counterparties, like NSCC, to ``establish, implement, maintain and enforce written policies and procedures reasonably designed to . . . [m]aintain sufficient financial resources to withstand, at a minimum, a default by the participant family to which it has the largest exposure in extreme but plausible market conditions . . . .'' \22\ NSCC believes that the Renewal and Future Renewals are consistent with Rule 17Ad-22(b)(3) because they would help NSCC maintain sufficient financial resources to withstand, at a minimum, a default by a NSCC Member to which NSCC has the largest exposure.\23\ --------------------------------------------------------------------------- \22\ 17 CFR 240.17Ad-22(b)(3). \23\ Id. --------------------------------------------------------------------------- Rule 17Ad-22(d)(11) \24\ requires that the Clearing Agencies, ``establish, implement, maintain and enforce written policies and procedures reasonably designed to, as applicable . . . establish default procedures that ensure that the clearing agency can take timely action to contain losses and liquidity pressures and to continue meeting its obligations in the event of a participant default.'' The Clearing Agencies believe the Renewal and Future Renewals are consistent with Rule 17Ad-22(d)(11) \25\ because they would provide the Clearing Agencies with a readily available liquidity resource that would enable the Clearing Agencies to continue to meet its obligations in a timely fashion, in the event of a Member default, thereby helping to contain losses and liquidity pressures from that default. --------------------------------------------------------------------------- \24\ 17 CFR 240.17Ad-22(d)(11). \25\ Id. --------------------------------------------------------------------------- Rule 17Ad-22(e)(7), which was recently adopted by the Commission, will require, in part, that the Clearing Agencies ``effectively measure, monitor, and manage the liquidity risk that arises in or is borne by [it], including measuring, monitoring, and managing its settlement and funding flows on an ongoing and timely basis, and its use of intraday liquidity by . . . [m]aintaining sufficient liquid resources at the minimum in all relevant currencies to effect same-day . . . settlement of payment obligations with a high degree of confidence under a wide range of foreseeable stress scenarios that includes, but is not limited to, the default of the participant family that would generate the largest aggregate payment of obligation for [each Clearing Agency] in extreme but plausible conditions.'' \26\ The Renewal and Future Renewals would provide NSCC with an additional liquidity resource that, together with its other sources of liquidity, including the Clearing Fund and the commercial paper and extendible- term note facility, can be used to complete end of day money settlement in the event a failure of a Member, including the failure of the participant family that would generate the largest aggregate payment of obligation for NSCC in extreme but plausible conditions. The Renewal and Future Renewals would provide DTC with an additional liquidity resource to enable it to complete system-wide settlement notwithstanding the failure-to-settle of a Participant or affiliated family of Participants with the largest net settlement obligation. In this way, the Renewal and Future Renewals are consistent with Rule 17Ad-22(e)(7).\27\ --------------------------------------------------------------------------- \26\ 17 CFR 240.17Ad-22(e)(7). \27\ Id. --------------------------------------------------------------------------- III. Date of Effectiveness of the Advance Notices, and Timing for Commission Action The proposed change may be implemented if the Commission does not object to the proposed change within 60 days of the later of (i) the date that the proposed change was filed with the Commission or (ii) the date that any additional information requested by the Commission is received. The Clearing Agencies shall not implement the proposed change if the Commission has any objection to the proposed change. The Commission may extend the period for review by an additional 60 days if the proposed change raises novel or complex issues, subject to the Commission providing the Clearing Agencies with prompt written notice of the extension. A proposed change may be implemented in less than 60 days from the date the Advance Notices are filed, or the date further information requested by the Commission is received, if the Commission notifies the Clearing Agencies in writing that it does not object to the proposed change and authorizes the Clearing Agencies to implement the proposed change on an earlier date, subject to any conditions imposed by the Commission. The Clearing Agencies shall post notice on their Web site of proposed changes that are implemented. IV. Solicitation of Comments Interested persons are invited to submit written data, views and arguments concerning the foregoing, including whether the Advance Notices are consistent with the Clearing Supervision Act. Comments may be submitted by any of the following methods: [[Page 21853]] Electronic CommentsUse 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-DTC-2017-802 or SR-NSCC-2017-802 on the subject line. Paper Comments Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549. All submissions should refer to File Number SR-DTC-2017-802 or SR-NSCC- 2017-802. One of these file numbers 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 Advance Notices that are filed with the Commission, and all written communications relating to the Advance Notices 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., Washington, DC 20549 on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filings also will be available for inspection and copying at the principal office of the Clearing Agencies and on DTCC's Web site (http://dtcc.com/legal/sec-rule-filings.aspx). 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-DTC-2017-802 or SR-NSCC-2017-802 and should be submitted on or before May 31, 2017. V. Commission Findings and Notice of No Objection Although the Clearing Supervision Act does not specify a standard of review for an advance notice, its stated purpose is instructive: To mitigate systemic risk in the financial system and promote financial stability by, among other things, promoting uniform risk management standards for systemically important financial market utilities and strengthening the liquidity of systemically important financial market utilities.\28\ Section 805(a)(2) of the Clearing Supervision Act \29\ authorizes the Commission to prescribe risk management standards for the payment, clearing, and settlement activities of designated clearing entities and financial institutions engaged in designated activities for which it is the supervisory agency or the appropriate financial regulator. Section 805(b) of the Clearing Supervision Act \30\ states that the objectives and principles for the risk management standards prescribed under Section 805(a) shall be to: --------------------------------------------------------------------------- \28\ 12 U.S.C. 5461(b). \29\ 12 U.S.C. 5464(a)(2). \30\ 12 U.S.C. 5464(b). --------------------------------------------------------------------------- Promote robust risk management; promote safety and soundness; reduce systemic risks; and support the stability of the broader financial system.\31\ --------------------------------------------------------------------------- \31\ Id. --------------------------------------------------------------------------- The Commission has adopted risk management standards under Section 805(a)(2) of the Act \32\ and Section 17A of the Act (``Rule 17Ad- 22'').\33\ The Rule 17Ad-22 requires registered clearing agencies to establish, implement, maintain, and enforce written policies and procedures that are reasonably designed to meet certain minimum requirements for their operations and risk management practices on an ongoing basis.\34\ Therefore, it is appropriate for the Commission to review changes proposed in advance notices against Rule 17Ad-22 and the objectives and principles of these risk management standards as described in Section 805(b) of the Clearing Supervision Act.\35\ The Commission believes the proposal in the Advance Notices is consistent with the objectives and principles described in Section 805(b) of the Act,\36\ and in Rule17Ad-22, in particular, Rule 17Ad-22(e)(7) under the Act.\37\ --------------------------------------------------------------------------- \32\ 12 U.S.C. 5464(a)(2). \33\ See 17 CFR 240.17Ad-22. \34\ Id. \35\ 12 U.S.C. 5464(b). \36\ Id. \37\ 17 CFR 240.17Ad-22(e)(7). --------------------------------------------------------------------------- A. Consistency With Section 805(b) of the Clearing Supervision Act As discussed below, the Commission believes that the changes proposed in the Advance Notice are consistent with Section 805(b) of the Clearing Supervision Act because they (i) promote robust risk management; (ii) are consistent with promoting safety and soundness; and (iii) are consistent with reducing systemic risks and promoting the stability of the broader financial system. The Commission believes that the changes proposed in the Advance Notices are consistent with promoting robust risk management, in particular management of liquidity risk presented to the Clearing Agencies. Renewing and maintaining the currently proposed credit facility in the manner proposed by the Clearing Agencies would diversify the liquidity resources that the Clearing Agencies may use to resolve a Member default. Additionally, allowing the Clearing Agencies annually to renew the credit facility under certain specified circumstances without an additional advance notice, subject to the specific conditions described above (the ``Evergreen'' provisions), would provide the Clearing Agencies and market participants with greater certainty regarding a continuing source of committed liquidity to meet its settlement obligations and thus mitigate the Clearing Agencies' liquidity risk. Further, because the Evergreen provisions would ensure that any such annual renewals would be substantially similar to the currently proposed credit facility, the Commission believes that any such renewals would promote robust risk management by diversifying the liquidity resources that the Clearing Agencies may use to resolve a Member default in the same manner as the currently proposed credit facility. As such, the Commission believes that the proposal would promote robust risk management practices at the Clearing Agencies, consistent with Section 805(b) of the Clearing Supervision Act.\38\ --------------------------------------------------------------------------- \38\ 12 U.S.C. 5464(b). --------------------------------------------------------------------------- The Commission also believes that the changes proposed in the Advance Notices are consistent with promoting safety and soundness. As described above, the currently proposed credit facility would provide the Clearing Agencies with an additional liquidity resource in the event of a Member default. This liquidity would promote safety and soundness for Members because it would provide the Clearing Agencies with a readily available liquidity resource that would enable them to continue to meet their respective obligations in a timely fashion in the event of a Member default, thereby helping to contain losses and liquidity pressures from that default. Because the Evergreen provisions would ensure that any annual renewals implemented without filing an advance notice would be substantially similar to the currently proposed credit facility, any such annual renewals would promote safety [[Page 21854]] and soundness for the same reasons. As such, the Commission believes it is consistent with promoting safety and soundness as contemplated in Section 805(b) of the Clearing Supervision Act.\39\ --------------------------------------------------------------------------- \39\ Id. --------------------------------------------------------------------------- In addition, the Commission believes that the proposal contained in the Advance Notices is consistent with reducing systemic risks and promoting the stability of the broader financial system. As mentioned above, allowing the Clearing Agencies to enter into the currently proposed credit facility would enable the Clearing Agencies, each of which has been designated a systemically important financial market utility,\40\ to maintain an additional liquidity resource that the Clearing Agencies may access to help manage a Member default. In addition, because the Evergreen provisions would ensure that any annual renewals entered into without filing an advance notice would be on substantially similar terms to the currently proposed credit facility, such future renewals also would enable the Clearing Agencies to maintain an additional liquidity resource that the Clearing Agencies may access to help manage a Member default. Moreover, allowing the annual renewal of the credit facility under the proposed Evergreen provisions without filing an additional advance notice would reduce the risk of gaps in availability of this liquidity resource. Further, allowing renewal without an advance notice in these specific circumstances would also provide heightened certainty and stability for the Clearing Agencies and market participants regarding the availability of this liquidity risk management resource on an ongoing basis. Accordingly, the Commission believes that the proposal would help to reduce the systemic risk of the Clearing Agencies, which in turn would help to support the stability of the broader financial system, consistent with Section 805(b) of the Clearing Supervision Act \41\ --------------------------------------------------------------------------- \40\ The Financial Stability Oversight Council designated NSCC a systemically important financial market utility on July 18, 2012. See Financial Stability Oversight Council 2012 Annual Report, Appendix A, http://www.treasury.gov/initiatives/fsoc/Documents/2012%20Annual%20Report.pdf. \41\ Id. --------------------------------------------------------------------------- B. Consistency With Rule 17Ad-22(e)(7) The Commission believes that the changes proposed by the Advance Notices are consistent with the requirements of Rules 17Ad-22(e)(7) under the Act.\42\ Rule 17Ad-22(e)(7) requires the Clearing Agencies to establish, implement, maintain and enforce written policies and procedures reasonably designed to effectively measure, monitor, and manage liquidity risk that arises in or is borne by the Clearing Agencies, including measuring, monitoring, and managing its settlement and funding flows on an ongoing and timely basis, and its use of intraday liquidity, as specified in the rule.\43\ --------------------------------------------------------------------------- \42\ 17 CFR 240.17Ad-22(e)(7). \43\ Id. --------------------------------------------------------------------------- In particular, Rule 17Ad-22(e)(7)(i) under the Act \44\ requires that registered clearing agencies to establish, implement, maintain and enforce written policies and procedures reasonably designed to ``effectively measure, monitor, and manage the liquidity risk that arises in or is borne by [it], including measuring, monitoring, and managing its settlement and funding flows on an ongoing and timely basis, and its use of intraday liquidity by . . . [m]aintaining sufficient liquid resources at the minimum in all relevant currencies to effect same-day . . . settlement of payment obligations with a high degree of confidence under a wide range of foreseeable stress scenarios that includes, but is not limited to, the default of the participant family that would generate the largest aggregate payment of obligation for [each Clearing Agency] in extreme but plausible conditions.'' --------------------------------------------------------------------------- \44\ 17 CFR 240.17Ad-22(e)(7)(i). --------------------------------------------------------------------------- As described above, the currently proposed credit facility would provide the Clearing Agencies with a readily available liquidity resource that would enable them to continue to meet their respective obligations in a timely fashion in the event of a Member default, thereby helping to contain losses and liquidity pressures from that default. Additionally, because the Evergreen provisions would ensure that any annual renewals would be substantially similar to the currently proposed credit facility, such renewals also would provide the Clearing Agencies with a readily available liquidity resource that would enable them to continue to meet their respective obligations in a timely fashion in the event of a Member default, thereby helping to contain losses and liquidity pressures from that default. Moreover, allowing the Clearing Agencies annually to renew the credit facility pursuant to the proposed Evergreen provisions without filing an additional advance notice would reduce the risk of gaps in liquidity coverage and better allow the Clearing Agencies to continually maintain sufficient liquidity resources. Therefore, the Commission believes that the proposal is consistent with Rule 17Ad-22(e)(7)(i). Rule 17Ad-22(e)(7)(ii) under the Act requires the Clearing Agencies to establish, implement, maintain and enforce written policies and procedures reasonably designed to hold qualifying liquid resources sufficient to satisfy payment obligations owed to clearing members.\45\ Rule 17Ad-22(a)(14) of the Act defines ``qualifying liquid resources'' to include, among other things, lines of credit without material adverse change provisions, that are readily available and convertible into cash.\46\ As described above, the currently proposed credit facility would permit the Clearing Agencies to enter into a single credit facility designed to help ensure that the Clearing Agencies have sufficient, readily-available qualifying liquid resources to meet the cash settlement obligations of their largest family of affiliated members. Similarly, because the Evergreen provisions would ensure that any annual renewals would be substantially similar to the currently proposed credit facility, such renewals also would permit the Clearing Agencies to enter into a single credit facility designed to help ensure that the Clearing Agencies have sufficient, readily-available qualifying liquid resources to meet the cash settlement obligations of their largest family of affiliated members. Therefore, the Commission believes that the proposal is consistent with Rule 17Ad-22(e)(7)(ii). --------------------------------------------------------------------------- \45\ 17 CFR 240.17Ad-22(e)(7)(ii). \46\ 17 CFR 240.17Ad-22(a)(14). --------------------------------------------------------------------------- VI. Conclusion It is therefore noticed, pursuant to Section 806(e)(1)(I) of the Clearing Supervision Act,\47\ that the Commission does not object to the Advance Notices SR-DTC-2017-802 and SR-NSCC-2017-802 and that DTC and NSCC be and hereby are authorized to implement the change as of the date of this notice. --------------------------------------------------------------------------- \47\ 12 U.S.C. 5465(e)(1)(I). By the Commission. Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2017-09459 Filed 5-9-17; 8:45 am] BILLING CODE 8011-01-P
![21850 Federal Register / Vol. 82, No. 89 / Wednesday, May 10, 2017 / Notices
proposed Exchange Rule 7.35E(h)(3)(A) Reform and Consumer Protection Act these statements may be examined at
and (B) to define ‘‘previously-live entitled the Payment, Clearing, and the places specified in Item IV below.
orders’’ for Core Open Auction, Trading Settlement Supervision Act of 2010 The Clearing Agencies have prepared
Halt Auction, Closing Auction, and IPO (‘‘Clearing Supervision Act’’) 1 and Rule summaries, set forth in sections A and
Auction and to define how unexecuted 19b–4(n)(1)(i) under the Securities B below, of the most significant aspects
orders would be processed when the Exchange Act of 1934 (‘‘Act’’),2 notice is of such statements.
Exchange transitions from continuous hereby given that on April 4, 2017 The
(A) Clearing Agencies’ Statement on
trading from a prior trading session; (5) Depository Trust Company (‘‘DTC’’) and
Comments on the Advance Notices
amend proposed Exchange rule National Securities Clearing Corporation
Received From Members, Participants,
7.31E(h)(3)(A) to specify that (‘‘NSCC,’’ together with DTC, ‘‘Clearing
or Others
Discretionary Pegged Orders do not Agencies’’) filed with the Securities and
participate in any auctions; (6) amend Exchange Commission (‘‘Commission’’) The Clearing Agencies have not
proposed Exchange Rule 7.34E(c)(1)(A) the advance notices SR–DTC–2017–802 solicited or received any written
to add a provision that Discretionary and SR–NSCC–2017–802. On May 1, comments relating to these proposals.
Pegged Orders may not be entered 2017, the Clearing Agencies filed The Clearing Agencies will notify the
before or during the Early Trading Amendments No. 1 to the advance Commission of any written comments
Session; (7) amend proposed Exchange notices.3 The advance notices, as received by the Clearing Agencies.
Rule 7.46E to reflect recent changes to modified by Amendments No. 1 (B) Advance Notices Filed Pursuant to
publication dates with respect to the (hereinafter, collectively ‘‘Advance Section 806(e) of the Payment, Clearing
Tick Size Pilot Plan; and (8) state that Notices’’), are described in Items I, II and Settlement Supervision Act
the Pillar transition is anticipated to and III below, which Items have been
occur in the third quarter of 2017. prepared primarily by the Clearing Description of the Proposals
The Commission believes that Agencies. The Commission is Renewal. As part of their liquidity risk
Amendment No. 1 does not raise novel publishing this notice to solicit management regime, the Clearing
regulatory issues and is based on, and comments on the Advance Notices from Agencies maintain a 364-day committed
substantively identical to, the existing interested persons and providing notice revolving line of credit with a syndicate
rules of other self-regulatory that the Commission does not object to of commercial lenders, which is
organizations. Accordingly, the the Advance Notices. renewed every year. The terms and
Commission finds good cause, pursuant conditions of the current Renewal
to Section 19(b)(2) of the Act,112 to I. Clearing Agencies’ Statement of the
Terms of Substance of the Advance would be specified in the Sixteenth
approve the proposed rule change, as Amended and Restated Revolving Credit
modified by Amendment No. 1, on an Notices
Agreement, to be dated as of May 9,
accelerated basis. These Advance Notices are filed by 2017 (‘‘Renewal Agreement’’), among
the Clearing Agencies in connection the Clearing Agencies,5 the lenders
VI. Conclusion with their proposals to (1) renew party thereto, the administrative agent
It is therefore ordered, that pursuant (‘‘Renewal’’) their 364-day committed and the collateral agent. Such terms and
to Section 19(b)(2) of the Act, that the revolving credit facility (‘‘Credit conditions are substantially the same as
proposed rule change, as modified by Facility’’), described below, and (2) the terms and conditions of the existing
Amendment No. 1, (SR–NYSEMKT– make annual renewals of the Credit credit agreement, dated as of May 10,
2017–01), be, and it hereby is, approved Facility on substantially similar terms 2016, as heretofore amended (‘‘Existing
on an accelerated basis. and conditions (‘‘Future Renewals’’), Agreement’’),6 except that pricing 7 and
For the Commission, by the Division of also described below, as described in the amount of the aggregate
Trading and Markets, pursuant to delegated greater detail below.4 commitment for NSCC may change. The
authority.113 substantive terms of the Renewal
II. Clearing Agencies’ Statement of the
Eduardo A. Aleman, Agreement are set forth in the Summary
Purpose of, and Statutory Basis for, the
Assistant Secretary. Advance Notices of Indicative Principal Terms and
[FR Doc. 2017–09419 Filed 5–9–17; 8:45 am] Conditions, dated March 30, 2017,
In their filings with the Commission, which is not a public document. The
BILLING CODE 8011–01–P
the Clearing Agencies included aggregate commitments being sought
statements concerning the purpose of under the Renewal would be for an
SECURITIES AND EXCHANGE and basis for the Advance Notices and amount up to $14 billion for NSCC and
COMMISSION discussed any comments they received DTC together, of which all but $1.9
on the Advance Notices. The text of billion commitment would be the
[Release No. 34–80605; File Nos. SR–DTC–
2017–802; SR–NSCC–2017–802] 1 12 U.S.C. 5465(e)(1). 5 The Renewal Agreement would provide for both
2 17 CFR 240.19b–4(n)(1)(i). DTC and NSCC as borrowers, with an aggregate
Self-Regulatory Organizations; The 3 In Amendments No. 1 to the advance notices,
commitment of $1.9 billion for DTC and the amount
Depository Trust Company; National the Clearing Agencies request Commission approval of any excess aggregate commitment for NSCC. The
Securities Clearing Corporation; to (i) accept $14.075 billion in aggregate borrowers are not jointly and severally liable and
Notice of Filing of and No Objection To commitments for this year’s facility, and (ii) clarify each lender has a ratable commitment to each
that for future renewals of the credit facility, the borrower. DTC and NSCC provide separate
Advance Notices, as Modified by Clearing Agencies may accept, not just seek, an collateral to secure their respective borrowings.
Amendments No. 1, To Renew the aggregate commitment amount within 15 percent of 6 See Securities Exchange Act Release No. 77750
jstallworth on DSK7TPTVN1PROD with NOTICES
Credit Facility $14 billion, as discussed below. (April 29, 2016), 81 FR 27181 (May 5, 2016) (SR–
4 Terms not defined herein are defined in the DTC–2017–801; SR–NSCC–2016–801).
May 5, 2017. Terms not defined herein are defined in the Rules, 7 ‘‘Pricing’’ of the Credit Facility refers to the
Pursuant to Section 806(e)(1) of Title By-Laws and Organization Certificate of DTC, charges and fees owed by the borrowers to the
available at http://www.dtcc.com/∼/media/Files/ agents and lenders thereto with respect to the
VIII of the Dodd-Frank Wall Street Downloads/legal/rules/dtc_rules.pdf; or Rules and services performed by the agents, the commitment
Procedures of NSCC (‘‘Rules’’), available at http:// to lend and the rate of interest applicable to any
112 15 U.S.C. 78s(b)(2). www.dtcc.com/∼/media/Files/Downloads/legal/ borrowing under the Credit Facility, among other
113 17 CFR 200.30–3(a)(12). rules/nscc_rules.pdf. such matters.
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![21852 Federal Register / Vol. 82, No. 89 / Wednesday, May 10, 2017 / Notices
the end-of-day net funds settlement to ‘‘establish, implement, maintain and and the commercial paper and
obligation of a DTC Participant cannot enforce written policies and procedures extendible-term note facility, can be
exceed DTC’s liquidity resources and is reasonably designed to . . . [m]aintain used to complete end of day money
fully collateralized. sufficient financial resources to settlement in the event a failure of a
The Credit Facility is a cornerstone of withstand, at a minimum, a default by Member, including the failure of the
the Clearing Agencies’ risk management the participant family to which it has participant family that would generate
and both the Renewal and Future the largest exposure in extreme but the largest aggregate payment of
Renewals are critical to the Clearing plausible market conditions . . . .’’ 22 obligation for NSCC in extreme but
Agencies’ risk management NSCC believes that the Renewal and plausible conditions. The Renewal and
infrastructure. Because the Renewal Future Renewals are consistent with Future Renewals would provide DTC
would preserve substantially similar Rule 17Ad–22(b)(3) because they would with an additional liquidity resource to
terms and conditions to the Existing help NSCC maintain sufficient financial enable it to complete system-wide
Agreement, and Future Renewals would resources to withstand, at a minimum, settlement notwithstanding the failure-
preserve substantially similar terms and a default by a NSCC Member to which to-settle of a Participant or affiliated
conditions to the Renewal Agreement, NSCC has the largest exposure.23 family of Participants with the largest
the Clearing Agencies believe that the Rule 17Ad–22(d)(11) 24 requires that
net settlement obligation. In this way,
Renewal and Future Renewals would the Clearing Agencies, ‘‘establish,
implement, maintain and enforce the Renewal and Future Renewals are
not otherwise affect or alter the consistent with Rule 17Ad–22(e)(7).27
management of risk at the Clearing written policies and procedures
Agencies. reasonably designed to, as applicable III. Date of Effectiveness of the Advance
. . . establish default procedures that Notices, and Timing for Commission
Consistency With the Clearing ensure that the clearing agency can take Action
Supervision Act timely action to contain losses and
The Clearing Agencies believe the liquidity pressures and to continue The proposed change may be
Renewal and Future Renewals are meeting its obligations in the event of a implemented if the Commission does
consistent with Section 805(b) of the participant default.’’ The Clearing not object to the proposed change
Clearing Supervision Act.16 The Agencies believe the Renewal and within 60 days of the later of (i) the date
objectives and principles of Section Future Renewals are consistent with that the proposed change was filed with
805(b) of the Clearing Supervision Act Rule 17Ad–22(d)(11) 25 because they the Commission or (ii) the date that any
are the promotion of robust risk would provide the Clearing Agencies additional information requested by the
management, promotion of safety and with a readily available liquidity Commission is received. The Clearing
soundness, reduction of systemic risks, resource that would enable the Clearing Agencies shall not implement the
and support of the stability of the Agencies to continue to meet its proposed change if the Commission has
broader financial system.17 The Clearing obligations in a timely fashion, in the any objection to the proposed change.
Agencies believe that the Renewal and event of a Member default, thereby
The Commission may extend the
Future Renewals would promote these helping to contain losses and liquidity
period for review by an additional 60
objectives and principles because they pressures from that default.
Rule 17Ad–22(e)(7), which was days if the proposed change raises novel
would provide the Clearing Agencies or complex issues, subject to the
with a continuing source of committed recently adopted by the Commission,
will require, in part, that the Clearing Commission providing the Clearing
liquidity to meet its settlement Agencies with prompt written notice of
obligations and thus mitigate the Agencies ‘‘effectively measure, monitor,
and manage the liquidity risk that arises the extension. A proposed change may
Clearing Agencies’ liquidity risk. be implemented in less than 60 days
Therefore, the Clearing Agencies believe in or is borne by [it], including
measuring, monitoring, and managing from the date the Advance Notices are
the Renewal and Future Renewals are filed, or the date further information
consistent with Section 805(b) of the its settlement and funding flows on an
ongoing and timely basis, and its use of requested by the Commission is
Clearing Supervision Act.18 received, if the Commission notifies the
The Clearing Agencies believe the intraday liquidity by . . . [m]aintaining
sufficient liquid resources at the Clearing Agencies in writing that it does
Renewal and Future Renewals are also not object to the proposed change and
consistent with Rule 17Ad–22(b)(3),19 minimum in all relevant currencies to
effect same-day . . . settlement of authorizes the Clearing Agencies to
Rule 17Ad–22(d)(11),20 and Rule 17Ad–
payment obligations with a high degree implement the proposed change on an
22(e)(7) under the Act.21
of confidence under a wide range of earlier date, subject to any conditions
Rule 17Ad–22(b)(3) requires, in part,
foreseeable stress scenarios that imposed by the Commission.
that central counterparties, like NSCC,
includes, but is not limited to, the The Clearing Agencies shall post
deficient account has sufficient Collateral to default of the participant family that notice on their Web site of proposed
proceed or until the applicable cutoff time occurs. would generate the largest aggregate changes that are implemented.
16 12 U.S.C. 5464(b).
payment of obligation for [each Clearing
17 Id.
Agency] in extreme but plausible IV. Solicitation of Comments
18 Id.
19 17 CFR 240.17Ad–22(b)(3).
conditions.’’ 26 The Renewal and Future Interested persons are invited to
20 17 CFR 240.17Ad–22(d)(11).
Renewals would provide NSCC with an submit written data, views and
21 17 CFR 240.17Ad–22(e)(7). The Commission additional liquidity resource that, arguments concerning the foregoing,
jstallworth on DSK7TPTVN1PROD with NOTICES
adopted amendments to Rule 17Ad–22, including together with its other sources of including whether the Advance Notices
the addition of new section 17Ad–22(e), on liquidity, including the Clearing Fund are consistent with the Clearing
September 28, 2016. See Securities Exchange Act
Release No. 78961 (September 28, 2016), 81 FR 22 17
Supervision Act. Comments may be
CFR 240.17Ad–22(b)(3).
70786 (October 13, 2016) (S7–03–14). NSCC and 23 Id. submitted by any of the following
DTC are ‘‘covered clearing agencies’’ as defined by methods:
24 17 CFR 240.17Ad–22(d)(11).
new Rule 17Ad–22(a)(5) and must comply with
25 Id.
new subsection (e) of Rule 17Ad–22 by April 11,
2017. 26 17 CFR 240.17Ad–22(e)(7). 27 Id.
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![21854 Federal Register / Vol. 82, No. 89 / Wednesday, May 10, 2017 / Notices
and soundness for the same reasons. As establish, implement, maintain and Commission believes that the proposal
such, the Commission believes it is enforce written policies and procedures is consistent with Rule 17Ad–22(e)(7)(i).
consistent with promoting safety and reasonably designed to effectively Rule 17Ad–22(e)(7)(ii) under the Act
soundness as contemplated in Section measure, monitor, and manage liquidity requires the Clearing Agencies to
805(b) of the Clearing Supervision risk that arises in or is borne by the
establish, implement, maintain and
Act.39 Clearing Agencies, including measuring,
In addition, the Commission believes enforce written policies and procedures
monitoring, and managing its settlement
that the proposal contained in the and funding flows on an ongoing and reasonably designed to hold qualifying
Advance Notices is consistent with timely basis, and its use of intraday liquid resources sufficient to satisfy
reducing systemic risks and promoting liquidity, as specified in the rule.43 payment obligations owed to clearing
the stability of the broader financial In particular, Rule 17Ad–22(e)(7)(i) members.45 Rule 17Ad–22(a)(14) of the
system. As mentioned above, allowing under the Act 44 requires that registered Act defines ‘‘qualifying liquid
the Clearing Agencies to enter into the clearing agencies to establish, resources’’ to include, among other
currently proposed credit facility would implement, maintain and enforce things, lines of credit without material
enable the Clearing Agencies, each of written policies and procedures adverse change provisions, that are
which has been designated a reasonably designed to ‘‘effectively readily available and convertible into
systemically important financial market measure, monitor, and manage the cash.46 As described above, the
utility,40 to maintain an additional liquidity risk that arises in or is borne currently proposed credit facility would
liquidity resource that the Clearing by [it], including measuring, permit the Clearing Agencies to enter
Agencies may access to help manage a monitoring, and managing its settlement into a single credit facility designed to
Member default. In addition, because and funding flows on an ongoing and help ensure that the Clearing Agencies
the Evergreen provisions would ensure timely basis, and its use of intraday have sufficient, readily-available
that any annual renewals entered into liquidity by . . . [m]aintaining qualifying liquid resources to meet the
without filing an advance notice would sufficient liquid resources at the
cash settlement obligations of their
be on substantially similar terms to the minimum in all relevant currencies to
largest family of affiliated members.
currently proposed credit facility, such effect same-day . . . settlement of
payment obligations with a high degree Similarly, because the Evergreen
future renewals also would enable the
of confidence under a wide range of provisions would ensure that any
Clearing Agencies to maintain an
additional liquidity resource that the foreseeable stress scenarios that annual renewals would be substantially
Clearing Agencies may access to help includes, but is not limited to, the similar to the currently proposed credit
manage a Member default. Moreover, default of the participant family that facility, such renewals also would
allowing the annual renewal of the would generate the largest aggregate permit the Clearing Agencies to enter
credit facility under the proposed payment of obligation for [each Clearing into a single credit facility designed to
Evergreen provisions without filing an Agency] in extreme but plausible help ensure that the Clearing Agencies
additional advance notice would reduce conditions.’’ have sufficient, readily-available
the risk of gaps in availability of this As described above, the currently qualifying liquid resources to meet the
liquidity resource. Further, allowing proposed credit facility would provide cash settlement obligations of their
renewal without an advance notice in the Clearing Agencies with a readily largest family of affiliated members.
these specific circumstances would also available liquidity resource that would Therefore, the Commission believes that
provide heightened certainty and enable them to continue to meet their the proposal is consistent with Rule
stability for the Clearing Agencies and respective obligations in a timely 17Ad–22(e)(7)(ii).
market participants regarding the fashion in the event of a Member
availability of this liquidity risk default, thereby helping to contain VI. Conclusion
management resource on an ongoing losses and liquidity pressures from that
default. Additionally, because the It is therefore noticed, pursuant to
basis. Accordingly, the Commission Section 806(e)(1)(I) of the Clearing
believes that the proposal would help to Evergreen provisions would ensure that
any annual renewals would be Supervision Act,47 that the Commission
reduce the systemic risk of the Clearing
substantially similar to the currently does not object to the Advance Notices
Agencies, which in turn would help to
proposed credit facility, such renewals SR–DTC–2017–802 and SR–NSCC–
support the stability of the broader
financial system, consistent with also would provide the Clearing 2017–802 and that DTC and NSCC be
Section 805(b) of the Clearing Agencies with a readily available and hereby are authorized to implement
Supervision Act 41 liquidity resource that would enable the change as of the date of this notice.
them to continue to meet their By the Commission.
B. Consistency With Rule 17Ad–22(e)(7) respective obligations in a timely
Eduardo A. Aleman,
The Commission believes that the fashion in the event of a Member
default, thereby helping to contain Assistant Secretary.
changes proposed by the Advance
Notices are consistent with the losses and liquidity pressures from that [FR Doc. 2017–09459 Filed 5–9–17; 8:45 am]
requirements of Rules 17Ad–22(e)(7) default. Moreover, allowing the Clearing BILLING CODE 8011–01–P
under the Act.42 Rule 17Ad–22(e)(7) Agencies annually to renew the credit
requires the Clearing Agencies to facility pursuant to the proposed
Evergreen provisions without filing an
jstallworth on DSK7TPTVN1PROD with NOTICES
39 Id. additional advance notice would reduce
40 The Financial Stability Oversight Council the risk of gaps in liquidity coverage
designated NSCC a systemically important financial and better allow the Clearing Agencies
market utility on July 18, 2012. See Financial
Stability Oversight Council 2012 Annual Report,
to continually maintain sufficient
Appendix A, http://www.treasury.gov/initiatives/ liquidity resources. Therefore, the
45 17 CFR 240.17Ad–22(e)(7)(ii).
fsoc/Documents/2012%20Annual%20Report.pdf.
41 Id. 43 Id. 46 17 CFR 240.17Ad–22(a)(14).
42 17 CFR 240.17Ad–22(e)(7). 44 17 CFR 240.17Ad–22(e)(7)(i). 47 12 U.S.C. 5465(e)(1)(I).
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Document Created: 2017-05-10 00:01:06
Document Modified: 2017-05-10 00:01:06
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Notices | |
| FR Citation | 82 FR 21850 |
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