Agencies Finalize Amendments to Swap Margin Rule

Orrick - Finance 20/20
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Orrick - Financial Industry Review

On June 25, federal agencies finalized a rule that updates margin and capital requirements for banks and other entities with significant swap activities. The updated rule no longer requires entities that are part of the same banking organization to hold a specific amount of initial margin for uncleared swaps with each other, such swaps being known as inter-affiliate swaps. The changes to the swap margin rule also provide additional flexibility to allocate collateral internally. The final rule is intended to facilitate risk management and maintain existing safeguards. Release. Final Rule.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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