House Subcommittee Examines Derivatives Proposals

The Subcommittee on Capital Markets, Securities and Investments reviewed legislative proposals relevant to derivatives end users.

ISDA CEO Scott O'Malia and SIFMA President and CEO Kenneth Bentsen testified in support of several recommendations to improve the current framework for the regulation of swaps and derivatives markets, including:

• domestic and global harmonization of rules, as well as other efforts to simplify and streamline rules;
• exemption of inter-affiliate swaps from initial margin requirements;
• harmonization of SEC and CFTC rules; and
• amendments to the supplemental leverage ratio to exempt margin posted by clients.

Mr. O'Malia advocated for a retention of the current $8 billion de minimis threshold. Mr. Bentsen said that any determination as to the threshold must appropriately take into consideration cross-border registration implications.