83 FR 55598 - Agency Information Collection Activities; Information Collection Renewal; Comment Request; Margin and Capital Requirements for Covered Swap Entities
DEPARTMENT OF THE TREASURY
Office of the Comptroller of the Currency Federal Register Volume 83, Issue 215 (November 6, 2018)
Office of the Comptroller of the Currency
Federal Register Volume 83, Issue 215 (November 6, 2018)
| Page Range | 55598-55600 | |
| FR Document | 2018-24209 |
[Federal Register Volume 83, Number 215 (Tuesday, November 6, 2018)] [Notices] [Pages 55598-55600] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2018-24209] ----------------------------------------------------------------------- DEPARTMENT OF THE TREASURY Office of the Comptroller of the Currency Agency Information Collection Activities; Information Collection Renewal; Comment Request; Margin and Capital Requirements for Covered Swap Entities AGENCY: Office of the Comptroller of the Currency (OCC), Treasury. ACTION: Notice and request for comment. ----------------------------------------------------------------------- SUMMARY: The OCC, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other federal agencies to take this opportunity to comment on a continuing information collection as required by the Paperwork Reduction Act of 1995 (PRA). In accordance with the requirements of the PRA, the OCC may not conduct or sponsor, and respondents are not required to respond to, an information collection unless it displays a currently valid Office of Management and Budget (OMB) control number. The OCC is soliciting comment concerning the renewal of its information collection titled ``Margin and Capital Requirements for Covered Swap Entities.'' DATES: Comments must be received by January 7, 2019. ADDRESSES: Commenters are encouraged to submit comments by email, if possible. You may submit comments by any of the following methods:Email: [email protected]. Mail: Legislative and Regulatory Activities Division, Office of the Comptroller of the Currency, Attention: 1557-0251, 400 7th Street SW, Suite 3E-218, Washington, DC 20219. Hand Delivery/Courier: 400 7th Street SW, Suite 3E-218, Washington, DC 20219. Fax: (571) 465-4326. Instructions: You must include ``OCC'' as the agency name and ``1557-0251'' in your comment. In general, the OCC will publish your comment on www.reginfo.gov 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 include 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 information collection beginning on the date of publication of the second notice for this collection \1\ by any of the following methods: --------------------------------------------------------------------------- \1\ Following the close of the 60-day comment period for this notice, the OCC will publish a notice for 30 days of comment for this collection. --------------------------------------------------------------------------- Viewing Comments Electronically: Go to www.reginfo.gov. Click on the ``Information Collection Review'' tab. Underneath the ``Currently under Review'' section heading, from the drop-down menu, select ``Department of Treasury'' and then click ``submit''. This information collection can be located by searching by OMB control number ``1557-0251'' or ``Margin and Capital Requirements for Covered Swap Entities.'' Upon finding the appropriate information collection, click on the related ``ICR Reference Number.'' On the next screen, select ``View Supporting Statement and Other Documents'' and then click on the link to any comment listed at the bottom of the screen. For assistance in navigating www.reginfo.gov, please contact the Regulatory Information Service Center at (202) 482-7340. Viewing Comments Personally: You may personally inspect comments at the OCC, 400 7th Street SW, Washington, DC. For security reasons, the OCC requires that visitors make an appointment to inspect comments. You may do so by calling (202) 649-6700 or, for persons who are deaf or hearing impaired, TTY, (202) 649-5597. Upon arrival, visitors will be required to present valid government-issued photo identification and submit to security screening in order to inspect comments. FOR FURTHER INFORMATION CONTACT: Shaquita Merritt, Clearance Officer, (202) 649-5490 or, for persons who are deaf or hearing impaired, TTY, (202) 649-5597, Chief Counsel's Office, Office of the Comptroller of the Currency, 400 7th Street SW, Washington, DC 20219. SUPPLEMENTARY INFORMATION: Under the PRA (44 U.S.C. 3501-3520), federal agencies must obtain approval from the OMB for each collection of information they conduct or sponsor. ``Collection of information'' is defined in 44 U.S.C. 3502(3) and 5 CFR 1320.3(c) to include Agency requests or requirements that members of the public submit reports, [[Page 55599]] keep records, or provide information to a third party. Section 3506(c)(2)(A) of title 44 (44 U.S.C. 3506(c)(2)(A)) requires federal agencies to provide a 60-day notice in the Federal Register concerning each proposed collection of information, including each proposed extension of an existing collection of information, before submitting the collection to OMB for approval. To comply with this requirement, the OCC is publishing notice of the renewal of the collection of information set forth in this document. Title: Margin and Capital Requirements for Covered Swap Entities. OMB Control No.: 1557-0251 (Merging in 1557-0335). Description: Title VII of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) established a comprehensive regulatory framework for derivatives, which are generally characterized as swaps and security-based swaps. Sections 731 and 764 of the Dodd- Frank Act require the registration and regulation of swap dealers and major swap participants and security-based swap dealers and major security-based swap participants, respectively (collectively, ``swap entities''). For certain types of swap entities that are prudentially regulated by one of the Agencies,\2\ sections 731 and 764 of the Dodd- Frank Act required the Agencies to jointly adopt rules for swap entities under their respective jurisdictions imposing capital requirements and initial and variation margin requirements on all non- cleared swaps. Swap entities that are prudentially regulated by the Agencies and therefore subject to the proposed rule are referred to herein as ``covered swap entities.'' --------------------------------------------------------------------------- \2\ The Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Federal Housing Finance Agency, and the Farm Credit Administration. --------------------------------------------------------------------------- Section 302 of the Terrorism Risk Insurance Program Reauthorization Act of 2015 (TRIPRA),\3\ amended sections 731 and 764 of the Dodd-Frank Act to provide that the initial and variation margin requirements do not apply to certain transactions with specified counterparties that qualify for an exemption or exception from clearing. Non-cleared swaps and non-cleared security-based swaps that are exempt under section 302 of TRIPRA are not subject to the Agencies' rules implementing margin requirements. TRIPRA augmented provisions that would allow swap entities to collect no initial or variation margin from certain ``other counterparties'' like commercial end-users with a provision that grants an exception from the margin requirements for certain swaps with these and certain additional counterparties. In addition, swap entities could continue with the current practice of collecting initial or variation margin at such times and in such forms and amounts (if any) as the covered swap entity determines appropriate consistent with its overall credit risk management of its exposures to ``other counterparties.'' --------------------------------------------------------------------------- \3\ Pubic Law 114-1, 129 Stat. 3 (2015). --------------------------------------------------------------------------- Section by Section Analysis The reporting requirements found in 12 CFR 45.1(d) refer to other statutory provisions that set forth conditions for an exemption from clearing. Section 45.1(d)(1) provides an exemption for non-cleared swaps if one of the counterparties to the swap is not a financial entity, is using swaps to hedge or mitigate commercial risk, and notifies the Commodity Futures Trading Commission of how it generally meets its financial obligations associated with entering into non- cleared swaps. Section 45.1(d)(2) provides an exemption for security- based swaps if the counterparty notifies the Securities and Exchange Commission (SEC) of how it generally meets its financial obligations associated with entering into non-cleared security-based swaps. Section 45.2 defines terms used in part 45, including the definition of ``eligible master netting agreement,'' which provides that a covered swap entity that relies on the agreement for purpose of calculating the required margin must: (1) Conduct sufficient legal review of the agreement to conclude with a well-founded basis that the agreement meets specified criteria; and (2) establish and maintain written procedures for monitoring relevant changes in law and to ensure that the agreement continues to satisfy the requirements of this section. The term ``eligible master netting agreement'' is used elsewhere in part 45 to specify instances in which a covered swap entity may: (1) Calculate variation margin on an aggregate basis across multiple non-cleared swaps and security-based swaps and (2) calculate initial margin requirements under an initial margin model for one or more swaps and security-based swaps. Section 45.5(c)(2)(i) specifies that a covered swap entity shall not be deemed to have violated its obligation to collect or post margin from or to a counterparty if the covered swap entity has made the necessary efforts to collect or post the required margin, including the timely initiation and continued pursuit of formal dispute resolution mechanisms, or has otherwise demonstrated upon request to the satisfaction of the agency that it has made appropriate efforts to collect or post the required margin. Section 45.7 generally requires a covered swap entity to ensure that any initial margin collateral that it collects or posts is held at a third-party custodian. Section 45.7(c) requires the custodian to act pursuant to a custody agreement that: (1) Prohibits the custodian from rehypothecating, repledging, reusing, or otherwise transferring (through securities lending, securities borrowing, repurchase agreement, reverse repurchase agreement or other means) the collateral held by the custodian, except that cash collateral may be held in a general deposit account with the custodian if the funds in the account are used to purchase an asset held in compliance with Sec. 45.7, and such purchase takes place within a time period reasonably necessary to consummate such purchase after the cash collateral is posted as initial margin and (2) is a legal, valid, binding, and enforceable agreement under the laws of all relevant jurisdictions, including in the event of bankruptcy, insolvency, or a similar proceeding. A custody agreement may permit the posting party to substitute or direct any reinvestment of posted collateral held by the custodian under certain conditions. With respect to collateral collected by a covered swap entity pursuant to Sec. 45.3(a) or posted by a covered swap entity pursuant to Sec. 45.3(b), the agreement must require the posting party to substitute only funds or other property that would qualify as eligible collateral under Sec. 45.6 and for which the amount net of applicable discounts described in Appendix B would be sufficient to meet the requirements of Sec. 45.3 and direct reinvestment of funds only in assets that would qualify as eligible collateral under Sec. 45.6. Section 45.8 establishes standards for the use of initial margin models. These standards include: (1) A requirement that the covered swap entity receive prior approval from the relevant Agency based on demonstration that the initial margin model meets specific requirements (Sec. Sec. 45.8(c)(1) and 45.8(c)(2)); (2) a requirement that a covered swap entity notify the relevant Agency in writing 60 days before extending use of the model to additional product types, making certain changes to the initial margin model, or making material changes to modeling assumptions (Sec. 45.8(c)(3)); and (3) a variety of quantitative requirements, [[Page 55600]] including requirements that the covered swap entity validate and demonstrate the reasonableness of its process for modeling and measuring hedging benefits, demonstrate to the satisfaction of the relevant Agency that the omission of any risk factor from the calculation of its initial margin is appropriate, demonstrate to the satisfaction of the relevant Agency that incorporation of any proxy or approximation used to capture the risks of the covered swap entity's non-cleared swaps or non-cleared security-based swaps is appropriate, periodically review and, as necessary, revise the data used to calibrate the initial margin model to ensure that the data incorporate an appropriate period of significant financial stress (Sec. Sec. 45.8(d)(5), 45.8(d)(10), 45.8(d)(11), 45.8(d)(12), and 45.8(d)(13)). Also, if the validation process reveals any material problems with the initial margin model, the covered swap entity must promptly notify the Agency of the problems, describe to the Agency any remedial actions being taken, and adjust the initial margin model to ensure an appropriately conservative amount of required initial margin is being calculated (Sec. 45.8(f)(3)). Section 45.8 also establishes requirements for the ongoing review and documentation of initial margin models. These standards include: (1) A requirement that a covered swap entity review its initial margin model annually (Sec. 45.8(e)); (2) a requirement that the covered swap entity validate its initial margin model at the outset and on an ongoing basis, describe to the relevant Agency any remedial actions being taken, and report internal audit findings regarding the effectiveness of the initial margin model to the covered swap entity's board of directors or a committee thereof (Sec. Sec. 45.8(f)(2), 45.8(f)(3), and 45.8(f)(4)); (3) a requirement that the covered swap entity adequately document all material aspects of its initial margin model (Sec. 45.8(g)); and (4) that the covered swap entity must adequately document internal authorization procedures, including escalation procedures, that require review and approval of any change to the initial margin calculation under the initial margin model, demonstrable analysis that any basis for any such change is consistent with the requirements of this section, and independent review of such demonstrable analysis and approval (Sec. 45.8(h)). Section 45.9 addresses the treatment of cross-border transactions and, in certain limited situations, will permit a covered swap entity to comply with a foreign regulatory framework for non-cleared swaps (as a substitute for compliance with the prudential regulators' rule) if the prudential regulators jointly determine that the foreign regulatory framework is comparable to the requirements in the prudential regulators' rule. Section 45.9(e) allows a covered swap entity to request that the prudential regulators make a substituted compliance determination and must provide the reasons therefore and other required supporting documentation. A request for a substituted compliance determination must include: (1) A description of the scope and objectives of the foreign regulatory framework for non-cleared swaps and non-cleared security-based swaps; (2) the specific provisions of the foreign regulatory framework for non-cleared swaps and security- based swaps (scope of transactions covered; determination of the amount of initial and variation margin required; timing of margin requirements; documentation requirements; forms of eligible collateral; segregation and re-hypothecation requirements; and approval process and standards for models); (3) the supervisory compliance program and enforcement authority exercised by a foreign financial regulatory authority or authorities in such system to support its oversight of the application of the non-cleared swap and security-based swap regulatory framework; and (4) any other descriptions and documentation that the prudential regulators determine are appropriate. A covered swap entity may make a request under this section only if directly supervised by the authorities administering the foreign regulatory framework for non- cleared swaps and non-cleared security-based swaps. Section 45.10 requires a covered swap entity to execute trading documentation with each counterparty that is either a swap entity or financial end user regarding credit support arrangements that: (1) Provides the contractual right to collect and post initial margin and variation margin in such amounts, in such form, and under such circumstances as are required and (2) specifies the methods, procedures, rules, and inputs for determining the value of each non- cleared swap or non-cleared security-based swap for purposes of calculating variation margin requirements and the procedures for resolving any disputes concerning valuation. Section 45.11(b)(1) provides that the requirement for a covered swap entity to post initial margin under Sec. 45.3(b) does not apply with respect to any non-cleared swap or non-cleared security-based swap with a counterparty that is an affiliate. A covered swap entity shall calculate the amount of initial margin that would be required to be posted to an affiliate that is a financial end user with material swaps exposure pursuant to Sec. 45.3(b) and provide documentation of such amount to each affiliate on a daily basis. Type of Review: Extension of a currently approved collection. Affected Public: Individuals; Businesses or other for-profit. Frequency of Response: On occasion. Estimated Number of Respondents: 10. Estimated Total Annual Burden: 17,390 hours. Comments submitted in response to this notice will be summarized and included in the submission to OMB. Comments are requested on: (a) Whether the information collections are necessary for the proper performance of the OCC's functions, including whether the information has practical utility; (b) The accuracy of the OCC's estimates of the burden of the information collections, including the validity of the methodology and assumptions used; (c) Ways to enhance the quality, utility, and clarity of the information to be collected; (d) Ways to minimize the burden of information collections on respondents, including through the use of automated collection techniques or other forms of information technology; and (e) Estimates of capital or start-up costs and costs of operation, maintenance, and purchase of services to provide information. Dated: October 31, 2018. Theodore J. Dowd, Deputy Chief Counsel, Office of the Comptroller of the Currency. [FR Doc. 2018-24209 Filed 11-5-18; 8:45 am] BILLING CODE 4810-33-P
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TABLE 2—CONTACT INFORMATION
Telephone number
Type of question Email addresses
(not toll free)
CDFI Bond Guarantee Program ..................................................................... (202) 653–0421 ................................. bgp@cdfi.treas.gov.
Option 5 .............................................
CDFI Certification ........................................................................................... (202) 653–0423 ................................. ccme@cdfi.treas.gov.
Compliance Monitoring and Evaluation .......................................................... (202) 653–0423 ................................. ccme@cdfi.treas.gov.
Information Technology Support .................................................................... (202) 653–0422 ................................. AMIS@cdfi.treas.gov.
C. Communication with the CDFI SUMMARY: The OCC, as part of its for this collection 1 by any of the
Fund. The CDFI Fund will use the AMIS continuing effort to reduce paperwork following methods:
internet interface to communicate with and respondent burden, invites the • Viewing Comments Electronically:
applicants, Qualified Issuers, Program general public and other federal Go to www.reginfo.gov. Click on the
Administrators, Servicers, Certified agencies to take this opportunity to ‘‘Information Collection Review’’ tab.
CDFIs and Eligible CDFIs, using the comment on a continuing information Underneath the ‘‘Currently under
contact information maintained in their collection as required by the Paperwork Review’’ section heading, from the drop-
respective AMIS accounts. Therefore, Reduction Act of 1995 (PRA). down menu, select ‘‘Department of
each such entity must maintain accurate In accordance with the requirements Treasury’’ and then click ‘‘submit’’. This
contact information (including contact of the PRA, the OCC may not conduct information collection can be located by
person and authorized representative, or sponsor, and respondents are not searching by OMB control number
email addresses, fax numbers, phone required to respond to, an information ‘‘1557–0251’’ or ‘‘Margin and Capital
numbers, and office addresses) in its collection unless it displays a currently Requirements for Covered Swap
respective AMIS account. For more valid Office of Management and Budget Entities.’’ Upon finding the appropriate
information about AMIS, please see the (OMB) control number. The OCC is information collection, click on the
AMIS Landing Page at https:// soliciting comment concerning the related ‘‘ICR Reference Number.’’ On the
amis.cdfifund.gov. renewal of its information collection next screen, select ‘‘View Supporting
titled ‘‘Margin and Capital Statement and Other Documents’’ and
VII. Information Sessions and Outreach
Requirements for Covered Swap then click on the link to any comment
The CDFI Fund may conduct Entities.’’ listed at the bottom of the screen.
webcasts, webinars, or information • For assistance in navigating
DATES: Comments must be received by
sessions for organizations that are www.reginfo.gov, please contact the
January 7, 2019.
considering applying to, or are Regulatory Information Service Center
interested in learning about, the CDFI ADDRESSES: Commenters are encouraged
to submit comments by email, if at (202) 482–7340.
Bond Guarantee Program. The CDFI • Viewing Comments Personally: You
Fund intends to provide targeted possible. You may submit comments by
any of the following methods: may personally inspect comments at the
outreach to both Qualified Issuer and OCC, 400 7th Street SW, Washington,
Eligible CDFI participants to clarify the • Email: prainfo@occ.treas.gov.
• Mail: Legislative and Regulatory DC. For security reasons, the OCC
roles and requirements under the CDFI requires that visitors make an
Activities Division, Office of the
Bond Guarantee Program. For further appointment to inspect comments. You
Comptroller of the Currency, Attention:
information, please visit the CDFI may do so by calling (202) 649–6700 or,
1557–0251, 400 7th Street SW, Suite
Fund’s website at http:// for persons who are deaf or hearing
3E–218, Washington, DC 20219.
www.cdfifund.gov. • Hand Delivery/Courier: 400 7th impaired, TTY, (202) 649–5597. Upon
Authority: Pub. L. 111–240; 12 U.S.C. Street SW, Suite 3E–218, Washington, arrival, visitors will be required to
4701, et seq.; 12 CFR part 1808; 12 CFR part DC 20219. present valid government-issued photo
1805; 12 CFR part 1815. • Fax: (571) 465–4326. identification and submit to security
Mary Ann Donovan, Instructions: You must include screening in order to inspect comments.
Director, Community Development Financial ‘‘OCC’’ as the agency name and ‘‘1557– FOR FURTHER INFORMATION CONTACT:
Institutions Fund. 0251’’ in your comment. In general, the Shaquita Merritt, Clearance Officer,
[FR Doc. 2018–24273 Filed 11–5–18; 8:45 am] OCC will publish your comment on (202) 649–5490 or, for persons who are
BILLING CODE 4810–70–P
www.reginfo.gov without change, deaf or hearing impaired, TTY, (202)
including any business or personal 649–5597, Chief Counsel’s Office, Office
information that you provide, such as of the Comptroller of the Currency, 400
DEPARTMENT OF THE TREASURY name and address information, email 7th Street SW, Washington, DC 20219.
addresses, or phone numbers. SUPPLEMENTARY INFORMATION: Under the
Office of the Comptroller of the Comments received, including PRA (44 U.S.C. 3501–3520), federal
Currency attachments and other supporting agencies must obtain approval from the
materials, are part of the public record OMB for each collection of information
Agency Information Collection and subject to public disclosure. Do not
Activities; Information Collection they conduct or sponsor. ‘‘Collection of
khammond on DSK30JT082PROD with NOTICES
include any information in your information’’ is defined in 44 U.S.C.
Renewal; Comment Request; Margin comment or supporting materials that
and Capital Requirements for Covered 3502(3) and 5 CFR 1320.3(c) to include
you consider confidential or Agency requests or requirements that
Swap Entities inappropriate for public disclosure. members of the public submit reports,
AGENCY: Office of the Comptroller of the You may review comments and other
Currency (OCC), Treasury. related materials that pertain to this 1 Following the close of the 60-day comment
information collection beginning on the period for this notice, the OCC will publish a notice
ACTION: Notice and request for comment.
date of publication of the second notice for 30 days of comment for this collection.
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including requirements that the covered demonstrable analysis and approval rules, and inputs for determining the
swap entity validate and demonstrate (§ 45.8(h)). value of each non-cleared swap or non-
the reasonableness of its process for Section 45.9 addresses the treatment cleared security-based swap for
modeling and measuring hedging of cross-border transactions and, in purposes of calculating variation margin
benefits, demonstrate to the satisfaction certain limited situations, will permit a requirements and the procedures for
of the relevant Agency that the omission covered swap entity to comply with a resolving any disputes concerning
of any risk factor from the calculation of foreign regulatory framework for non- valuation.
its initial margin is appropriate, cleared swaps (as a substitute for Section 45.11(b)(1) provides that the
demonstrate to the satisfaction of the compliance with the prudential requirement for a covered swap entity to
relevant Agency that incorporation of regulators’ rule) if the prudential post initial margin under § 45.3(b) does
any proxy or approximation used to regulators jointly determine that the not apply with respect to any non-
capture the risks of the covered swap foreign regulatory framework is cleared swap or non-cleared security-
entity’s non-cleared swaps or non- comparable to the requirements in the based swap with a counterparty that is
cleared security-based swaps is prudential regulators’ rule. Section an affiliate. A covered swap entity shall
appropriate, periodically review and, as 45.9(e) allows a covered swap entity to calculate the amount of initial margin
necessary, revise the data used to request that the prudential regulators that would be required to be posted to
calibrate the initial margin model to make a substituted compliance an affiliate that is a financial end user
ensure that the data incorporate an determination and must provide the with material swaps exposure pursuant
appropriate period of significant reasons therefore and other required to § 45.3(b) and provide documentation
financial stress (§§ 45.8(d)(5), supporting documentation. A request of such amount to each affiliate on a
45.8(d)(10), 45.8(d)(11), 45.8(d)(12), and for a substituted compliance daily basis.
45.8(d)(13)). Also, if the validation determination must include: (1) A Type of Review: Extension of a
process reveals any material problems description of the scope and objectives currently approved collection.
with the initial margin model, the of the foreign regulatory framework for
Affected Public: Individuals;
covered swap entity must promptly non-cleared swaps and non-cleared
Businesses or other for-profit.
notify the Agency of the problems, security-based swaps; (2) the specific
provisions of the foreign regulatory Frequency of Response: On occasion.
describe to the Agency any remedial Estimated Number of Respondents:
actions being taken, and adjust the framework for non-cleared swaps and
security-based swaps (scope of 10.
initial margin model to ensure an Estimated Total Annual Burden:
appropriately conservative amount of transactions covered; determination of
the amount of initial and variation 17,390 hours.
required initial margin is being Comments submitted in response to
calculated (§ 45.8(f)(3)). margin required; timing of margin
requirements; documentation this notice will be summarized and
Section 45.8 also establishes requirements; forms of eligible included in the submission to OMB.
requirements for the ongoing review and collateral; segregation and re- Comments are requested on:
documentation of initial margin models. hypothecation requirements; and (a) Whether the information
These standards include: (1) A approval process and standards for collections are necessary for the proper
requirement that a covered swap entity models); (3) the supervisory compliance performance of the OCC’s functions,
review its initial margin model annually program and enforcement authority including whether the information has
(§ 45.8(e)); (2) a requirement that the exercised by a foreign financial practical utility;
covered swap entity validate its initial regulatory authority or authorities in (b) The accuracy of the OCC’s
margin model at the outset and on an such system to support its oversight of estimates of the burden of the
ongoing basis, describe to the relevant the application of the non-cleared swap information collections, including the
Agency any remedial actions being and security-based swap regulatory validity of the methodology and
taken, and report internal audit findings framework; and (4) any other assumptions used;
regarding the effectiveness of the initial descriptions and documentation that the (c) Ways to enhance the quality,
margin model to the covered swap prudential regulators determine are utility, and clarity of the information to
entity’s board of directors or a appropriate. A covered swap entity may be collected;
committee thereof (§§ 45.8(f)(2), make a request under this section only (d) Ways to minimize the burden of
45.8(f)(3), and 45.8(f)(4)); (3) a if directly supervised by the authorities information collections on respondents,
requirement that the covered swap administering the foreign regulatory including through the use of automated
entity adequately document all material framework for non-cleared swaps and collection techniques or other forms of
aspects of its initial margin model non-cleared security-based swaps. information technology; and
(§ 45.8(g)); and (4) that the covered swap Section 45.10 requires a covered swap (e) Estimates of capital or start-up
entity must adequately document entity to execute trading documentation costs and costs of operation,
internal authorization procedures, with each counterparty that is either a maintenance, and purchase of services
including escalation procedures, that swap entity or financial end user to provide information.
require review and approval of any regarding credit support arrangements
change to the initial margin calculation that: (1) Provides the contractual right to Dated: October 31, 2018.
under the initial margin model, collect and post initial margin and Theodore J. Dowd,
demonstrable analysis that any basis for variation margin in such amounts, in Deputy Chief Counsel, Office of the
Comptroller of the Currency.
khammond on DSK30JT082PROD with NOTICES
any such change is consistent with the such form, and under such
requirements of this section, and circumstances as are required and (2) [FR Doc. 2018–24209 Filed 11–5–18; 8:45 am]
independent review of such specifies the methods, procedures, BILLING CODE 4810–33–P
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Document Created: 2018-11-06 00:18:35
Document Modified: 2018-11-06 00:18:35
| 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 | |
| Action | Notice and request for comment. | |
| Dates | Comments must be received by January 7, 2019. | |
| Contact | Shaquita Merritt, Clearance Officer, (202) 649-5490 or, for persons who are deaf or hearing impaired, TTY, (202) 649-5597, Chief Counsel's Office, Office of the Comptroller of the Currency, 400 7th Street SW, Washington, DC 20219. | |
| FR Citation | 83 FR 55598 |
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