The Federal Reserve voted to re-propose a rule that would require prudentially regulated swap dealers and participants to put up capital and collect minimum amounts and initial margin and variation margin from counterparties to swaps not cleared by a central counterparty.
The rule, which will be jointly issued by the Fed, FDIC, OCC, Federal Housing Finance Agency and Farm Credit Administration, would set margin requirements based on the risk associated with the counterparty, whether it is an end user, another swap entity or other counterparty. The proposal would also determine what counts as collateral.
The agencies originally proposed capital and margin requirements for swap entities in April 2011. They are re-proposing the rule with changes based on earlier comments and on international standards for margin requirements released in 2013.
Read the proposed rule.