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Proposed Swap Dealer Capital Requirements: The CFTC’s Long Path Towards a More Risk-Based Approach  

Author:  Katherine Cooper.

Source: Volume 51, Number 14, August 15 2018 , pp.173-178(6)

Review of Securities & Commodities Regulation

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The CFTC’s proposed minimum capital requirements for SDs and MSPs have met with criticism from industry on a variety of points. These include the use of initial margin, reliance on notional amounts, effect on smaller SDs, inconsistency with the SEC’s proposed capital rule, duplicative reviews for internal capital models, and reporting requirements. The author reviews the proposal and the criticism, and suggests that, with likely improvements, the final rules will better achieve risk-based outcomes for required minimum capital.

Keywords: Swap Dealers (“SDs”); Major Swap Participants (“MSPs”); Minimum Capital Standards

Affiliations:  1: Murphy & McGonigle PC.

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