The comment period on a proposal to change swap margin rules will be reopened and extended to Jan. 23, the three federal banking regulators and two other federal regulators said Friday.
The Federal Deposit Insurance Corp. (FDIC), Federal Reserve and Office of the Comptroller of the Currency (OCC) joined with the Farm Credit Administration (FCA) and the Federal Housing Finance Agency (FHFA) in issuing the extension. Comments had originally been due Dec. 9.
The agencies said they were extending the comment on the proposal – which would remove the requirement for banks to collect initial margin on swaps with affiliates — to allow “interested persons more time to analyze the issues and prepare their comments.”
The proposal was first announced in September by the FDIC, with Board Member Martin Gruenberg dissenting. Federal Reserve Board Gov. Lael Brainard also issued a dissent, noting she backed portions of the proposed rule but raised concerns about the elimination of the inter-affiliate initial margin requirement without making compensating adjustments elsewhere in regulation.
The proposal has also gained the attention of congressional Democrats. House Financial Services Committee Chairwoman Maxine Waters (D-Calif.), in a statement last fall, said the FDIC should not adopt the proposed rule and that she “will continue to work to prevent its implementation.”
Waters and Sen. Sherrod Brown (D-Ohio), ranking member of the Senate Banking Committee, also said in a joint letter to the heads of the FDIC, Federal Reserve Board, and Office of the Comptroller of the Currency (OCC) that easing the requirements would be “a deliberate decision for less stability in the financial system.”