OCC Files Motion with SEC to Lift Automatic Stay of Approval Order of Capital Plan

Share Article

Clearing House Hopes for Quick Resolution to Benefit Clearing Member Firms and Markets

News Image

OCC, the world’s largest equity derivatives clearing organization, today said it has filed a motion with the U.S. Securities and Exchange Commission (SEC) to lift the current stay of the approval order of its proposed capital plan. Under the SEC’s rules, the stay was instituted automatically after petitions were filed and is part of the SEC’s approval process.

“OCC is seeking to lift the stay of the approval order and move forward with the implementation of our capital plan. We are hopeful that this matter will be resolved promptly as we believe no new issues were raised by the petitions and that the benefits of OCC’s capital plan are exceedingly valuable to market participants,” said Craig Donohue, OCC Executive Chairman. “OCC’s capital plan is a balanced approach, designed in the best interest of our clearing members, their customers, the exchanges and OCC. While significantly strengthening our capital base, it allows us to meet the heightened capital requirements critical for SIFMUs like OCC in a timely manner,” he added.

On February 26 the SEC issued a “notice of no objection” to OCC’s advance notice describing its capital plan, in which the SEC stated that the plan “contributes to reducing systemic risks and supporting the stability of the broader financial system.” On March 6, after extensive consideration of industry comments, the SEC approved OCC’s proposed rule change in support of the plan, which was approved by the SEC through delegated authority to its staff. Even with the approvals, the SEC's rules of practice permit petitions requesting review of the approval order.

The OCC capital plan was designed to strengthen OCC’s capital base and facilitate its compliance with proposed SEC regulations for Systemically Important Financial Market Utilities (SIFMUs) as well as international standards applicable to financial market infrastructures. When the plan was approved, OCC announced a refund of $33.3 million from 2014 fees to its clearing members and the return to a lower fee schedule with reductions by approximately 19 percent. The implementation of the refunds and fee reductions was automatically stayed by the filing of the petitions until the SEC orders otherwise, and OCC intends to implement them as soon as the SEC allows.

About OCC
OCC is the world's largest equity derivatives clearing organization. Founded in 1973, OCC operates under the jurisdiction of both the U.S. Securities and Exchange Commission (SEC) as a Registered Clearing Agency and the U.S. Commodity Futures Trading Commission (CFTC) as a Derivatives Clearing Organization. OCC now provides central counterparty (CCP) clearing and settlement services to 16 exchanges and trading platforms for options, financial futures, security futures and securities lending transactions. More information about OCC is available at http://www.theocc.com.

###

Share article on socal media or email:

View article via:

Pdf Print

Contact Author

Angela Kotso
OCC
+1 312-322-6267
Email >

Caroline Davis
OCC
312-322-1923
Email >