Self-Regulatory Organizations; The Depository Trust Company; Fixed Income Clearing Corporation; National Securities Clearing Corporation; Notice of Filing and Immediate Effectiveness of Proposed Rule Changes To Revise the Clearing Agency Investment Policy, 67779-67785 [2018-28378]
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Federal Register / Vol. 83, No. 249 / Monday, December 31, 2018 / Notices
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will impose
any burden on competition not
necessary or appropriate in furtherance
of the purposes of the Act. The
proposed rule change does not make
any substantive change to Exchange
General 8 and will not impact
competition.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
No written comments were either
solicited or received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule
change does not: (i) Significantly affect
the protection of investors or the public
interest; (ii) impose any significant
burden on competition; and (iii) become
operative for 30 days from the date on
which it was filed, or such shorter time
as the Commission may designate, it has
become effective pursuant to Section
19(b)(3)(A)(iii) of the Act 13 and
subparagraph (f)(6) of Rule 19b–4
thereunder.14
At any time within 60 days of the
filing of the proposed rule change, the
Commission summarily may
temporarily suspend such rule change if
it appears to the Commission that such
action is necessary or appropriate in the
public interest, for the protection of
investors, or otherwise in furtherance of
the purposes of the Act. If the
Commission takes such action, the
Commission shall institute proceedings
to determine whether the proposed rule
should be approved or disapproved.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
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Electronic Comments
• Use the Commission’s internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
MRX–2018–40 on the subject line.
Paper Comments
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–MRX–2018–40. This file
number should be included on the
subject line if email is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
internet website (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for website viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE,
Washington, DC 20549, on official
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the
filing also will be available for
inspection and copying at the principal
office of the Exchange. All comments
received will be posted without change.
Persons submitting comments are
cautioned that we do not redact or edit
personal identifying information from
comment submissions. You should
submit only information that you wish
to make available publicly. All
submissions should refer to File
Number SR–MRX–2018–40 and should
be submitted on or before January 22,
2019.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.15
Brent J. Fields,
Secretary.
[FR Doc. 2018–28383 Filed 12–28–18; 8:45 am]
BILLING CODE 8011–01–P
13 15
U.S.C. 78s(b)(3)(A)(iii).
14 17 CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6) requires a self-regulatory organization to give
the Commission written notice of its intent to file
the proposed rule change at least five business days
prior to the date of filing of the proposed rule
change, or such shorter time as designated by the
Commission. The Exchange has satisfied this
requirement.
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SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–84949; File Nos. SR–DTC–
2018–012; SR–FICC–2018–014; SR–NSCC–
2018–013]
Self-Regulatory Organizations; The
Depository Trust Company; Fixed
Income Clearing Corporation; National
Securities Clearing Corporation;
Notice of Filing and Immediate
Effectiveness of Proposed Rule
Changes To Revise the Clearing
Agency Investment Policy
December 21, 2018.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2
notice is hereby given that on December
13, 2018, The Depository Trust
Company (‘‘DTC’’), Fixed Income
Clearing Corporation (‘‘FICC’’), and
National Securities Clearing Corporation
(‘‘NSCC,’’ and together with DTC and
FICC, the ‘‘Clearing Agencies’’) filed
with the Securities and Exchange
Commission (‘‘Commission’’) the
proposed rule changes as described in
Items I, II and III below, which Items
have been prepared primarily by the
Clearing Agencies. The Clearing
Agencies filed the proposed rule
changes pursuant to Section 19(b)(3)(A)
of the Act 3 and Rule 19b–4(f)(4)
thereunder.4 The Commission is
publishing this notice to solicit
comments on the proposed rule changes
from interested persons.
I. Clearing Agencies’ Statement of the
Terms of Substance of the Proposed
Rule Changes
The proposed rule changes consists of
amendments to the Clearing Agency
Investment Policy (‘‘Investment Policy’’)
of the Clearing Agencies in order to (1)
update the governance for changes to
the Investment Policy and provide for
annual approval of the Investment
Policy by the Board of Directors of each
of the Clearing Agencies (collectively,
‘‘Boards’’); (2) revise the process for
identifying an applicable external credit
rating for a potential investment
counterparty when there are
discrepancies between available
external credit ratings for that potential
counterparty; (3) amend the authority to
approve (a) the establishment of an
investment relationship with an
investment counterparty, (b) investment
transactions that exceed applicable
investment limits, and (c) investment
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A).
4 17 CFR 240.19b–4(f)(4).
2 17
15 17
PO 00000
CFR 200.30–3(a)(12).
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transactions in high grade corporate
debt and U.S. Treasury securities; and
(4) make technical corrections and
revisions to clarify and simplify
statements in the Investment Policy; as
described in greater detail below.
II. Clearing Agencies’ Statement of the
Purpose of, and Statutory Basis for, the
Proposed Rule Changes
In their filings with the Commission,
the Clearing Agencies included
statements concerning the purpose of
and basis for the proposed rule changes
and discussed any comments they
received on the proposed rule changes.
The text of these statements may be
examined at the places specified in Item
IV below. The Clearing Agencies have
prepared summaries, set forth in
sections A, B, and C below, of the most
significant aspects of such statements.
(A) Clearing Agencies’ Statement of the
Purpose of, and Statutory Basis for, the
Proposed Rule Changes
1. Purpose
The Clearing Agencies are proposing
to revise the Investment Policy, which
was adopted in December 2016 5 and are
maintained in compliance with Rule
17Ad–22(e)(16) under the Act.6
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Overview of the Investment Policy
The Investment Policy governs the
management, custody and investment of
cash deposited to the respective NSCC
and FICC Clearing Funds, and the DTC
Participants Fund,7 the proprietary
liquid net assets (cash and cash
equivalents) of the Clearing Agencies,
and other funds held by the Clearing
Agencies pursuant to their respective
rules.
The Investment Policy identifies the
guiding principles for investments and
defines the roles and responsibilities of
DTCC staff in administering the
Investment Policy pursuant to those
5 See Securities Exchange Act Release No. 79528
(December 12, 2016), 81 FR 91232 (December 16,
2016) (SR–DTC–2016–007, SR–FICC–2016–005,
SR–NSCC–2016–003).
6 17 CFR 240.17Ad–22(e)(16). As discussed in
this filing, the Investment Policy also addresses
compliance with the requirements of Rule 17Ad–
22(e)(3). 17 CFR 240.17Ad–22(e)(3).
7 The respective Clearing Funds of NSCC and
FICC, and the DTC Participants Fund are described
further in the Rules & Procedures of NSCC (‘‘NSCC
Rules’’), the DTC Rules, By-laws and Organization
Certificate (‘‘DTC Rules’’), the Clearing Rules of the
Mortgage-Backed Securities Division of FICC
(‘‘MBSD Rules’’) or the Rulebook of the Government
Securities Division of FICC (‘‘GSD Rules’’),
respectively, available at https://dtcc.com/legal/
rules-and-procedures. See Rule 4 (Clearing Fund) of
the NSCC Rules, Rule 4 (Participants Fund and
Participants Investment) of the DTC Rules, Rule 4
(Clearing Fund and Loss Allocation) of the GSD
Rules and Rule 4 (Clearing Fund and Loss
Allocation) of the MBSD Rules.
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principles. The Investment Policy is coowned by DTCC’s Treasury group
(‘‘Treasury’’) 8 and the Counterparty
Credit Risk team (‘‘CCR’’) within
DTCC’s Group Chief Risk Office
(‘‘GCRO’’).9 Treasury is responsible for
identifying potential counterparties to
investment transactions, establishing
and managing investment relationships
with approved investment
counterparties, and making and
monitoring all investment transactions
with respect to the Clearing Agencies.
CCR is responsible for conducting a
credit review of any potential
counterparty, updating those reviews on
a quarterly basis, and establishing an
investment limit for each counterparty.
The Investment Policy also identifies
sources of funds that may be invested,
and the permitted investments of those
funds, including the authority required
to make such investments and the
parameters of, and limitations on, each
type of investment. Allowable
investments include bank deposits,
reverse repurchase agreements, direct
obligations of the U.S. government,
money market mutual funds, high-grade
corporate debt, and hedge transactions.
Finally, the Investment Policy defines
the approval authority required to
exceed established investment limits.
Proposed Revisions to the Investment
Policy
The Investment Policy is reviewed
and approved by the Boards annually.
In connection with the most recent
annual review of the Investment Policy,
the Clearing Agencies have decided to
propose certain revisions and updates.
These proposed revisions, described in
greater detail below, are designed to
update the Investment Policy and help
ensure that it continues to operate as
intended.
1. Investment Policy Change
Management and Annual Board
Approval
The Clearing Agencies are proposing
revisions to two aspects of governance
in the Investment Policy: (1) Approving
changes to the Investment Policy and (2)
annual approval by the Board, as
described below.
8 Treasury is a part of the DTCC Finance
Department and is responsible for the safeguarding,
investment and disbursement of funds on behalf of
the Clearing Agencies and in accordance with the
principles outlined in the Investment Policy.
9 Among other responsibilities, GCRO is generally
responsible for the systems and processes designed
to identify and manage credit, market and liquidity
risks to the Clearing Agencies.
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a. Governance for Approving Changes to
Investment Policy
Currently, the Investment Policy
includes a statement that ‘‘routine’’
changes to the Investment Policy must
be approved jointly by an officer in
Treasury and an officer in CCR, and that
material changes to the Investment
Policy must be approved by the Boards,
or such committee as may be delegated
authority by the Boards from time to
time.
The Boards have delegated to the
General Counsel and the Deputy
General Counsels of the Clearing
Agencies the authority to approve
certain proposed rule changes of the
Clearing Agencies and the filings with
respect to such proposed rule changes
required by Rule 19b–4 under the Act.10
Specifically, the Boards have delegated
to the General Counsel and Deputy
General Counsels of the Clearing
Agencies authority to approve (1)
proposed rule changes that may be filed
pursuant to Section 19(b)(3)(A) of the
Act,11 (2) proposed rule changes that
constitute clarifications, corrections or
minor changes in the rules of the
Clearing Agencies but that will not be
filed pursuant to Section 19(b)(3)(A) of
the Act,12 in each case, other than any
rule change where the aggregate annual
fees generated as a result of such rule
change are anticipated to be more than
$1,000,000 at the time of the filing, and
(3) all proposed changes that are subject
to an advance notice as required by Rule
19b–4(n) under the Act 13 but do not
constitute a change to the rules of
Clearing Agencies.
Therefore, the statement within the
Investment Policy that ‘‘routine’’
changes to the Investment Policy must
be approved jointly by an officer in
Treasury and an officer in CCR, and that
material changes to the Investment
Policy must be approved by the Boards
or committees of the Boards is
inconsistent with these existing
delegations of approval authority. As
such, the Clearing Agencies are
proposing to amend the Investment
Policy to clarify that changes to the
Investment Policy may be approved by
either (1) the Boards, (2) such Board
committees as may be delegated
authority by the Boards from time to
time pursuant to their charters, or (3),
with respect to certain changes, the
General Counsel or Deputy General
Counsels of the Clearing Agencies,
pursuant to authority delegated by the
10 17
11 15
CFR 240.19b–4.
U.S.C. 78s(b)(3)(A).
12 Id.
13 17
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Boards and with the advice and
direction of Treasury and CCR.
The proposed change would make the
Investment Policy consistent with
existing internal delegations of authority
and would also facilitate expedited
review and approval of changes that
may not require the review and
approval of the Boards or committees of
the Boards.
b. Annual Approval of Investment
Policy by Boards
The Investment Policy currently states
that the Boards or such committees as
may be delegated authority from time to
time shall review the Investment Policy
on an annual basis.
Rule 17Ad–22(e)(3) under the Act
requires the Clearing Agencies to
maintain a sound risk management
framework for comprehensively
managing the risks that arise in or are
borne by the Clearing Agencies,
including investment and custody
risks.14 Rule 17Ad–22(e)(3)(i) under the
Act requires that the risk management
policies, procedures, and systems that
are maintained in compliance with Rule
17Ad–22(e)(3) be subject to review on a
specified periodic basis and be
approved by the Boards annually.15 As
stated above, the Investment Policy
governs the management, custody and
investment held by the Clearing
Agencies, and is maintained in order to
manage the Clearing Agencies’
investment and custody risks, as
required by Rule 17Ad–22(e)(3) under
the Act.16 Therefore, the Investment
Policy must be approved by the Boards
annually, as required by Rule 17Ad–
22(e)(3)(i) under the Act.17
The Clearing Agencies are proposing
to amend the Investment Policy to
provide that the Investment Policy shall
be approved annually by the Boards or
such committees as may be delegated
authority from time to time.18 The
proposed change would align the
governance of the Investment Policy
with the applicable requirements of
Rule 17Ad–22(e)(3)(i) under the Act.19
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2. Process for Identifying External Credit
Rating of Potential Investment
Counterparties
One of the responsibilities of CCR
under the Investment Policy is to
perform credit reviews of potential
investment counterparties. The credit
review is used to determine if the
14 17
CFR 240.17Ad–22(e)(3).
CFR 240.17Ad–22(e)(3)(i).
16 17 CFR 240.17Ad–22(e)(3).
17 17 CFR 240.17Ad–22(e)(3)(i).
18 Id.
19 Id.
15 17
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Clearing Agencies should establish an
investment relationship with that entity,
and what, if any, limits should be
placed on investments with that entity
as an investment counterparty. These
credit reviews may include, for
example, a business description,
identification of key risks and any
mitigants to those risks, a general
financial analysis of the potential
counterparty, such counterparty’s
available external credit ratings, and the
recommended investment limit for such
counterparty. The Investment Policy
sets a minimum external credit rating
for potential investment counterparties
for specified types of investments.
External credit ratings may be assigned
by either S&P Global Ratings, Moody’s
Investors Service, Inc., or Fitch Ratings
Inc.
Currently, the Investment Policy
states that if there is a single notch
discrepancy between available external
credit ratings, CCR shall use the more
favorable rating available. The
Investment Policy further states that, if
there is a multiple notch discrepancy
between available external credit ratings
for a potential investment counterparty,
CCR may use its discretion, based on
information available to it, in
determining the applicable credit rating
for its credit review of that counterparty.
The Clearing Agencies are proposing
to amend the Investment Policy to
remove CCR’s discretion that may be
used when there is a multiple notch
discrepancy between the external credit
ratings, and instead require that CCR
shall use the rating that is one notch
above the lowest available external
credit rating for that counterparty.
The Clearing Agencies determined
that this approach would be appropriate
because credit ratings may be obtained
from one of the three credit rating
agencies identified above, so there could
only be a maximum of three available
credit ratings for an entity. As such,
under this proposed approach, the
middle available rating would be
applied where there is a multiple notch
discrepancy between available credit
ratings.
The Clearing Agencies believe the
proposed change would improve the
process for applying an external credit
rating in connection with credit reviews
because it would create a clear and
objective approach to identifying the
applicable external credit rating in these
circumstances by removing CCR’s
discretion in determining which rating
to apply.
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67781
3. Approval Authority for Investments
Relationships, Exceeding Investment
Limits and Certain Investment
Transactions
The Investment Policy identifies the
groups of individuals who have the
authority to approve (1) the
establishment of an investment
relationship with an investment
counterparty, (2) investment
transactions that exceed applicable
investment limits, and (3) investment
transactions in high grade corporate
debt and U.S. Treasury securities. The
Clearing Agencies are proposing to
revise the approval authority in the
Investments Policy, as described below.
a. Focus the Approval Authority for
Investments Relationships and
Exceeding Investment Limits to
Managing Director in CCR
The Clearing Agencies are proposing
to amend the authority for approving
the establishment of investment
relationships and investment
transactions that exceed investment
limits to restrict one of the individuals
authorized to provide such approvals to
a Managing Director in CCR, rather than
any Managing Director in GCRO, for the
reasons described below.
First, with respect to the authority to
establish an investment relationship
with an investment counterparty, the
Investment Policy currently identifies
two groups of authorized individuals—
‘‘Group A’’ and ‘‘Group B’’—and
provides that an investment relationship
may be approved by either two
individuals from Group A acting jointly,
or by one individual from Group A and
one individual from Group B acting
jointly. Currently, Group A includes the
Group Chief Risk Officer or a Managing
Director in the Financial Risk
Management group (the former name of
the GCRO).20
Second, with respect to approving
investment transactions that exceed
applicable investment limits, the
Investment Policy currently identifies
three groups of individuals—‘‘Group
A,’’ ‘‘Group B,’’ and ‘‘Group C’’—and
provides that an investment transaction
that exceeds applicable investment
limits may be approved by either one
individual in Group A and one
individual from Group B acting jointly;
or one individual in Group A or one
individual in Group B, and one
individual in Group C, acting jointly.
Currently, Group B includes both a
20 As described below, the Clearing Agencies are
proposing to make a technical revision to the
Investment Policy to update all references to the
Financial Risk Management group, or ‘‘FRM,’’ to the
Group Chief Risk Office, or ‘‘GCRO.’’
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Managing Director in GCRO and the
Group Chief Risk Officer.
The Clearing Agencies are proposing
to limit the Managing Director in GCRO
who is authorized to provide these
approvals to a Managing Director in the
CCR group within GCRO. As described
above, CCR is responsible for
conducting the credit reviews of
potential investment counterparties, and
for setting investment limits for
investment counterparties. Therefore, a
Managing Director in CCR is more
closely involved in conducting credit
reviews of potential investment
counterparties and setting investment
limits that are appropriate based on
those reviews, where other Managing
Directors within GCRO do not have a
role in the administration of the
Investment Policy. Therefore, the
Clearing Agencies believe this proposed
change is appropriate because it would
focus the authorization to an individual
who may be more capable of providing
an informed authorization when
necessary.
The Clearing Agencies are also
proposing to provide that a Managing
Director in CCR may assign a delegate
within CCR with the title of Executive
Director or higher, to jointly approve
investment transactions that exceed
applicable limits in the event a CCR
Managing Director is unavailable. The
approval of these transactions may be
required in a short timeframe.
Therefore, the proposed change would
allow the Clearing Agencies to obtain
these joint approvals from an officer
within CCR, when necessary, without
unnecessary delay in the event a
Managing Director in CCR is not
available to provide the requested
authorization.
b. Revising Approval Authority for
Certain Investment Transactions
The Clearing Agencies are proposing
to make two revisions to the approval
authority for investment transactions in
high grade corporate debt and U.S.
Treasury securities, as described below.
Currently, the Investment Policy
provides that investment transactions in
high grade corporate debt and U.S.
Treasury securities where the remaining
time to maturity is two years or less
must be approved by two individuals,
acting jointly, who are identified in a
group of individuals that includes both
senior level executives and lower level
officers. The value of investments that
mature on a longer timeframe are
subject to greater uncertainty over that
period and such investments are
generally viewed as posing greater risk.
Therefore, the Investment Policy
provides that investment transactions in
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high grade corporate debt and U.S.
Treasury securities where the remaining
time to maturity is more than two years
must be approved by two individuals,
acting jointly, from the same group of
individuals who are authorized to
approve such investments that mature
on a shorter timeframe, so long as at
least one of those individuals is a senior
level executive.
First, the Clearing Agencies are
proposing to revise the scope of
investments that the two groups of
individuals are authorized to approve.
The proposed change would provide the
first group of individuals with authority
to approve investments, with two of
them acting jointly, for a time to
maturity of one year or less, and would
provide the second group of individuals
with authority to approve investments
with a time to maturity of greater than
one year, and up to a maximum of ten
years for investments in U.S. Treasury
securities and up to a maximum of five
years for investments in high grade
corporate debt. This proposed change
would provide for a more conservative
approach to approving these
investments by limiting the investments
that may be approved by the first group
of authorized individuals to only those
that mature on a shorter timeframe, and
pose less risk.
Second, the Clearing Agencies are
proposing to include an Executive
Director in Finance in the first group of
individuals, who are authorized to act
jointly to approve investment
transactions with a remaining time to
maturity of one year or less. This
proposed change would provide the
Clearing Agencies with more flexibility
to authorize investment transactions
where the time to maturity is one year
or less by authorizing an additional
officer to approve this revised set of
investments. The Investment Policy
would continue to require that at least
one of the individuals who approve
investments that have a longer time to
maturity be a senior level executive.
4. Technical Revisions
The Clearing Agencies are proposing
to reorganize and reorder certain
sections of the Investment Policy, and
make other updates, corrections and
clarifications, as described below.
a. Reordering and Reorganizing Certain
Sections of the Investment Policy
First, the Clearing Agencies are
proposing to remove Section 1.1, titled
‘‘Document Control Information,’’ from
the Investment Policy. The information
under this heading would be
incorporated into the Overview in
Section 1, and this proposed change
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would simplify the organization of this
Section.
Second, the Clearing Agencies are
proposing to move the information
currently in Section 7 to other sections
in the Investment Policy and eliminate
Section 7. Currently, Section 7.1
describes the authorizations for
establishing investment relationships,
and Section 7.2 describes the
authorizations for entering into
investment transactions. The
information currently in Section 7.1
would be moved to a new Section 4.3.
This proposed change would revise the
Investment Policy so the authorizations
for establishing investment
relationships appears directly after the
description of credit reviews of
potential investment counterparties
performed by CCR in Section 4.2.
The information currently in Section
7.2 would be moved to Section 6.2. This
proposed change would revise the
Investment Policy so the authorizations
for investment transactions appear in
the same Section as the description of
the applicable investment type. As such,
Sections 6.2.1, 6.2.2, and 6.2.4, which
describe investments in bank deposits,
reverse repurchase agreements, and
money market mutual funds,
respectively, would include a statement
that investment transactions in these
investment types are authorized
pursuant to Section 4.1 of the
Investment Policy and no separate
approvals for such investment
transactions are required. Sections 6.2.3
and 6.2.5, which describe investments
in U.S. treasury securities and highgrade corporate debt, respectively,
would include a table of the required
authorizations for investment
transactions in these investment types.
The authorizations described in these
tables would be amended as described
above. The Investment Policy would
also be updated to make conforming
changes to update internal crossreferences to these reorganized Sections.
Third, the Clearing Agencies are
proposing to revise Section 6.2.6, which
describes hedge transactions. The
proposed change would move a
statement regarding factors that may be
considered when authorizing a hedge
transaction to appear above the table of
authorizations of those transactions.
This proposed change would align
Section 6.2.6 to be organized similarly
to other subsections within Section 6.2,
such that the information regarding
authorizations of those transactions
appears at the end of the subsection.
The Clearing Agencies believe each of
the proposed changes are appropriate.
By reorganization the Investment Policy
such that sections regarding similar
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matters appear together, the proposed
changes would improve the clarity of
the Investment Policy.
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b. Other Updates and Technical
Revisions
The Clearing Agencies are also
proposing to make other updates and
technical revisions to the Investment
Policy. These technical revisions would,
for example, correct internal crossreferences, revise the use of defined
terms, and clarify descriptions within
the Investment Policy, without changing
the substantive statements being
revised.
For example, Section 6.2.1 would be
revised to include term deposits in a list
of types of bank deposit investment
transactions that may be executed
pursuant to the Investment Policy.
While the existing list was intended to
be non-exhaustive, the proposed change
would clarify that term bank deposits
are also permitted. As another example,
the Investment Policy would be revised
to reflect a change to the name of the
DTCC’s Financial Risk Management
group, or ‘‘FRM,’’ to the GCRO.
The Clearing Agencies believe the
proposed updates and technical
revisions would improve the clarity and
accuracy of the Investment Policy and,
therefore, would facilitate the execution
of the Investment Policy.
2. Statutory Basis
The Clearing Agencies believe that the
proposed rule changes are consistent
with the requirements of the Act and the
rules and regulations thereunder
applicable to a registered clearing
agency. In particular, the Clearing
Agencies believe that the proposed
modifications to the Investment Policy
are consistent with Section 17A(b)(3)(F)
of the Act 21 and Rules 17Ad–22(e)(3)(i)
and (16) under the Act,22 for the reasons
described below.
Section 17A(b)(3)(F) of the Act
requires, in part, that the rules of each
of the Clearing Agencies be designed to
assure the safeguarding of securities and
funds which are in the custody or
control of each of the Clearing Agencies
or for which they are responsible.23 The
investment guidelines and governance
procedures set forth in the Investment
Policy are designed to safeguard funds
which are in the custody or control of
the Clearing Agencies or for which they
are responsible. Such protections
include, for example, following a
prudent and conservative investment
philosophy that places the highest
21 15
U.S.C. 78q–1(b)(3)(F).
CFR 240.17Ad–22(e)(3)(i) and (16).
23 15 U.S.C. 78q–1(b)(3)(F).
22 17
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priority on maximizing liquidity and
risk avoidance. The Clearing Agencies
believe each of these proposed changes
would help facilitate the effective
execution of the Investment Policy
pursuant to the guiding principle set
forth therein. Therefore, the Clearing
Agencies believe the proposed changes
would allow the Clearing Agencies to
continue to operate the Investment
Policy pursuant to a prudent and
conservative investment philosophy
that assures the safeguarding of
securities and funds which are in their
custody and control, or for which they
are responsible.
First, the Clearing Agencies believe
the proposed changes to the Investment
Policy governance would improve the
processes for maintaining the
Investment Policy and ensuring it
continues to operate as intended. The
proposed changes to reflect the existing
delegation of authority to the General
Counsel and Deputy General Counsels
of the Clearing Agencies to approve
certain changes to the Investment Policy
would align this process to existing
governance and delegations of authority
within the Clearing Agencies. This
proposed change would permit an
expedited review and approval of
changes that do not require action by
the Boards or Board committees. In this
way, the Clearing Agencies believe the
proposed change would simplify the
steps necessary for the Clearing
Agencies to make certain non-material
changes to the Investment Policy,
subject to required regulatory review
and approval of such changes.
Meanwhile, the Clearing Agencies
believe that the proposed change to
require annual approval of the
Investment Policy would provide for
stronger Board oversight and create an
important control over the Investment
Policy’s effectiveness.
Second, the Clearing Agencies believe
the proposed change to the process for
identifying an applicable external credit
rating for potential investment
counterparties when there is a multiple
notch discrepancy between available
ratings would improve the credit
reviews of those entities. The proposed
change would improve credit reviews
by creating a more objective approach to
this aspect of those reviews and creating
more consistency in the evaluation of
these entities. Understanding the risks
that may be presented by an investment
counterparty is an important aspect of
the Investment Policy’s guidelines and
governance procedures that are
designed to safeguard funds which are
in the custody or control of the Clearing
Agencies or for which they are
responsible.
PO 00000
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Fmt 4703
Sfmt 4703
67783
Third, the Clearing Agencies believe
the proposed change to certain approval
authority within the Investment Policy
would both enable the Clearing
Agencies to authorize those individuals
who are involved with the matters that
they may be asked to approve, and
would facilitate those approvals by
authorizing additional individuals to
approve lower risk matters. The
proposed change to the approval
authority for establishing investment
relationships and entering investment
transactions that exceed applicable
limits to include only Managing
Directors in CCR would refine this
approval authority to individuals who
are involved in these matters, and may
be better able to provide an informed
approval. The proposed change to the
approval authority for investment
transactions with maturity time would
shift that authority to senior executives
for investments that pose greater risk,
creating a more conservative approach
to those approvals. The proposed
change to authorize Executive Directors
in Finance to approve investment
transactions with remaining time to
maturity of less than one year would
facilitate the approval of these
transactions that pose less risk to the
Clearing Agencies.
Finally, the Clearing Agencies believe
the proposed changes to reorganize
certain sections within the Investment
Policy and the proposed updates and
technical revisions to the Investment
Policy would improve the clarity and
accuracy of the Investment Policy. By
creating clearer descriptions, the
Clearing Agencies believe these
proposed changes would make the
Investment Policy more effective in
governing the management, custody,
and investment of funds of and held by
the Clearing Agencies.
For the reasons described above, the
Clearing Agencies believe the proposed
changes would improve the
effectiveness of the Investment Policy
and allow the Investment Policy to
continue to be administered in
alignment with the investment
guidelines and governance procedures
set forth therein. Given that such
guidelines and governance procedures
are designed to safeguard funds which
are in the custody or control of the
Clearing Agencies or for which they are
responsible, the Clearing Agencies
believe the proposed changes are
consistent with the requirements of
Section 17A(b)(3)(F) of the Act.24
Rule 17Ad–22(e)(3)(i) requires, in
part, that the Clearing Agencies
establish, implement, maintain and
24 Id.
E:\FR\FM\31DEN1.SGM
31DEN1
khammond on DSK30JT082PROD with NOTICES
67784
Federal Register / Vol. 83, No. 249 / Monday, December 31, 2018 / Notices
enforce written policies and procedures
reasonably designed to maintain a
sound risk management framework for
comprehensively managing investment
and custody risks that arise in or are
borne by the Clearing Agencies, which
includes risk management policies,
procedures, and systems designed to
identify, measure, monitor, and manage
the range of risks that arise in or are
borne by the Clearing Agencies, that are
subject to review on a specified periodic
basis and approved by the board of
directors annually.25 The Clearing
Agencies are proposing to revise the
Investment Policy to require that it be
reviewed and approved by the Boards,
or an authorized Board Committee, at
least annually. The Boards, or an
authorized Board Committee, will be
provided with a copy of the Investment
Policy at a regularly scheduled meeting,
along with a memorandum describing
any changes that had been made to the
Investment Policy since its last annual
approval. This proposed change would
provide for important oversight of the
operation of the Investment Policy and
its continued effectiveness in governing
the management, custody and
investment of funds held by the
Clearing Agencies. The proposed change
is also designed to align the governance
of the Investment Policy with the
applicable requirements of Rule 17Ad–
22(e)(3)(i) under the Act.26
Rule 17Ad–22(e)(16) under the Act
requires the Clearing Agencies to
establish, implement, maintain and
enforce written policies and procedures
reasonably designed to safeguard the
Clearing Agencies’ own and their
participants’ assets, minimize the risk of
loss and delay in access to these assets,
and invest such assets in instruments
with minimal credit, market, and
liquidity risks.27
The Clearing Agencies believe that the
Investment Policy follows a prudent and
conservative investment philosophy,
placing the highest priority on
maximizing liquidity and avoiding risk
of loss, by requiring the segregation of
funds of each Clearing Agency and of
types of funds of each Clearing Agency,
using external credit ratings in the
evaluation of counterparties, and
establishing investment limits by
counterparty as well as investment type.
As originally implemented, the
Investment Policy was designed to meet
the requirements of Rule 17Ad–
22(e)(16) under the Act.28
25 17
IV. Solicitation of Comments
(B) Clearing Agencies’ Statement on
Burden on Competition
Paper Comments
Each of the Clearing Agencies believes
that none of the proposed revisions to
the Investment Policy would have any
impact, or impose any burden, on
competition. The Investment Policy
applies equally to the Clearing Fund
and Participants Fund deposits, as
applicable, of each member of the
Clearing Agencies, and establishes a
uniform policy at the Clearing Agencies.
The proposed changes to the Investment
Policy would not affect any changes on
the fundamental purpose or operation of
this document and, as such, would also
not have any impact, or impose any
burden, on competition.
(C) Clearing Agencies’ Statement on
Comments on the Proposed Rule
Changes Received From Members,
Participants, or Others
The Clearing Agencies have not
solicited or received any written
comments relating to this proposal. The
Clearing Agencies will notify the
Commission of any written comments
received by the Clearing Agencies.
III. Date of Effectiveness of the
Proposed Rule Changes, and Timing for
Commission Action
The foregoing rule changes have
become effective pursuant to Section
19(b)(3)(A) of the Act 30 and paragraph
(f) of Rule 19b–4 thereunder.31 At any
time within 60 days of the filing of the
proposed rule change, the Commission
summarily may temporarily suspend
such rule changes if it appears to the
Commission that such action is
necessary or appropriate in the public
interest, for the protection of investors,
or otherwise in furtherance of the
purposes of the Act.
CFR 240.17Ad–22(e)(3)(i).
26 Id.
27 17
For the reasons stated above, the
Clearing Agencies believe that each of
the proposed revisions would improve
the administration of the Investment
Policy and would make the Investment
Policy more effective in governing the
management, custody, and investment
of funds of and held by the Clearing
Agencies. In this way, the proposed
changes would better allow the Clearing
Agencies to maintain these documents
in a way that is designed to meet the
requirements of Rule 17Ad–22(e)(16).
Therefore, the Clearing Agencies believe
the proposed revisions would be
consistent with the requirements of Rule
17Ad–22(e)(16) under the Act.29
29 Id.
CFR 240.17Ad–22(e)(16).
30 15
28 Id.
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31 17
16:24 Dec 28, 2018
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PO 00000
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f).
Frm 00073
Fmt 4703
Sfmt 4703
Interested persons are invited to
submit written data, views and
arguments concerning the foregoing,
including whether the proposed rule
changes are consistent with the Act.
Comments may be submitted by any of
the following methods:
Electronic Comments
• Use the Commission’s internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
DTC–2018–012, SR–FICC–2018–014, or
SR–NSCC–2018–013 on the subject line.
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE,
Washington, DC 20549.
All submissions should refer to File
Number SR–DTC–2018–012, SR–FICC–
2018–014, or SR–NSCC–2018–013. One
of these file numbers should be
included on the subject line if email is
used. To help the Commission process
and review your comments more
efficiently, please use only one method.
The Commission will post all comments
on the Commission’s internet website
(https://www.sec.gov/rules/sro.shtml).
Copies of the submissions, all
subsequent amendments, all written
statements with respect to the proposed
rule changes that are filed with the
Commission, and all written
communications relating to the
proposed rule changes between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for website viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE,
Washington, DC 20549 on official
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the
filings also will be available for
inspection and copying at the principal
office of the Clearing Agencies and on
DTCC’s website (https://dtcc.com/legal/
sec-rule-filings.aspx). All comments
received will be posted without change.
Persons submitting comments are
cautioned that we do not redact or edit
personal identifying information from
comment submissions. You should
submit only information that you wish
to make available publicly. All
submissions should refer to File
Number SR–DTC–2018–012, SR–FICC–
2018–014, or SR–NSCC–2018–013 and
should be submitted on or before
January 22, 2019.
E:\FR\FM\31DEN1.SGM
31DEN1
Federal Register / Vol. 83, No. 249 / Monday, December 31, 2018 / Notices
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.32
Brent J. Fields,
Secretary.
[FR Doc. 2018–28378 Filed 12–28–18; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–84948; File No. SRCboeBZX–2018–044]
Self-Regulatory Organizations; Cboe
BZX Exchange, Inc.; Notice of
Designation of a Longer Period for
Commission Action on Proceedings To
Determine Whether To Approve or
Disapprove a Proposed Rule Change,
as Modified by Amendment No. 1, To
Amend BZX Rule 14.11(c) (Index Fund
Shares)
December 21, 2018.
khammond on DSK30JT082PROD with NOTICES
On June 21, 2018, Cboe BZX
Exchange, Inc. (‘‘Exchange’’ or ‘‘BZX’’)
filed with the Securities and Exchange
Commission (‘‘Commission’’), pursuant
to Section 19(b)(1) of the Securities
Exchange Act of 1934 (‘‘Act’’) 1 and Rule
19b–4 thereunder,2 a proposed rule
change to amend BZX Rule 14.11(c) to
permit either the portfolio holdings of a
series of Index Fund Shares or the index
underlying a series of Index Fund
Shares to satisfy the listing standards
under BZX Rules 14.11(c)(3), (4), and
(5). The proposed rule change was
published for comment in the Federal
Register on July 11, 2018.3 On August
23, 2018, pursuant to Section 19(b)(2) of
the Act,4 the Commission designated a
longer period within which to approve
the proposed rule change, disapprove
the proposed rule change, or institute
proceedings to determine whether to
approve or disapprove the proposed
rule change.5 On September 28, 2018,
the Exchange filed Amendment No. 1 to
the proposed rule change, which
amended and replaced the proposed
rule change as originally filed. On
October 5, 2018, the Commission
published notice of Amendment No. 1
and instituted proceedings pursuant to
Section 19(b)(2)(B) of the Act 6 to
determine whether to approve or
disapprove the proposed rule change, as
32 17
CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 See Securities Exchange Act Release No. 83594
(July 5, 2018), 83 FR 32158.
4 15 U.S.C. 78s(b)(2).
5 See Securities Exchange Act Release No. 83919,
83 FR 44083 (August 29, 2018).
6 15 U.S.C. 78s(b)(2)(B).
VerDate Sep<11>2014
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67785
modified by Amendment No. 1.7 The
Commission has received one comment
letter on the proposed rule change.8
Section 19(b)(2) of the Act 9 provides
that, after initiating disapproval
proceedings, the Commission shall issue
an order approving or disapproving the
proposed rule change not later than 180
days after the date of publication of
notice of filing of the proposed rule
change. The Commission may extend
the period for issuing an order
approving or disapproving the proposed
rule change, however, by not more than
60 days if the Commission determines
that a longer period is appropriate and
publishes the reasons for such
determination. The proposed rule
change was published for notice and
comment in the Federal Register on July
11, 2018. January 7, 2019 is 180 days
from that date, and March 8, 2019 is 240
days from that date.
The Commission finds it appropriate
to designate a longer period within
which to issue an order approving or
disapproving the proposed rule change
so that it has sufficient time to consider
the proposed rule change, as modified
by Amendment No. 1. Accordingly, the
Commission, pursuant to Section
19(b)(2) of the Act,10 designates March
8, 2019 as the date by which the
Commission shall either approve or
disapprove the proposed rule change, as
modified by Amendment No. 1 (File No.
SR–CboeBZX–2018–044).
SECURITIES AND EXCHANGE
COMMISSION
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.11
Brent J. Fields,
Secretary.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
Exchange included statements
concerning the purpose of and basis for
the proposed rule change and discussed
any comments it received on the
proposed rule change. The text of these
statements may be examined at the
places specified in Item IV below. The
Exchange has prepared summaries, set
forth in sections A, B, and C below, of
the most significant aspects of such
statements.
[FR Doc. 2018–28379 Filed 12–28–18; 8:45 am]
BILLING CODE 8011–01–P
7 See Securities Exchange Act Release No. 84378,
83 FR 51745 (October 12, 2018).
8 See letter from Kyle Murray, Assistant General
Counsel, Cboe Global Markets, Inc. to Brent J.
Fields, Secretary, Commission, dated November 16,
2018.
9 15 U.S.C. 78s(b)(2).
10 Id.
11 17 CFR 200.30–3(a)(57).
PO 00000
Frm 00074
Fmt 4703
Sfmt 4703
[Release No. 34–84929; File No. SR–
CboeEDGX–2018–060]
Self-Regulatory Organizations; Cboe
EDGX Exchange, Inc.; Notice of Filing
and Immediate Effectiveness of a
Proposed Rule Change Relating To
Discontinue Bulk Order Functionality
and Implement Bulk Message
Functionality, and Make Other
Nonsubstantive Changes
December 21, 2018.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on December
13, 2018, Cboe EDGX Exchange, Inc.
(the ‘‘Exchange’’ or ‘‘EDGX’’) filed with
the Securities and Exchange
Commission (‘‘Commission’’) the
proposed rule change as described in
Items I and II below, which Items have
been prepared by the Exchange. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The text of the proposed rule change
is also available on the Exchange’s
website (https://www.cboe.com/
AboutCBOE/CBOELegalRegulatory
Home.aspx), at the Exchange’s Office of
the Secretary, and at the Commission’s
Public Reference Room.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
In 2016, the Exchange’s parent
company, Cboe Global Markets, Inc.
(‘‘Cboe Global’’), which is the parent
1 15
2 17
E:\FR\FM\31DEN1.SGM
U.S.C. 78s(b)(1).
CFR 240.19b–4.
31DEN1
Agencies
[Federal Register Volume 83, Number 249 (Monday, December 31, 2018)]
[Notices]
[Pages 67779-67785]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-28378]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-84949; File Nos. SR-DTC-2018-012; SR-FICC-2018-014; SR-
NSCC-2018-013]
Self-Regulatory Organizations; The Depository Trust Company;
Fixed Income Clearing Corporation; National Securities Clearing
Corporation; Notice of Filing and Immediate Effectiveness of Proposed
Rule Changes To Revise the Clearing Agency Investment Policy
December 21, 2018.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on December 13, 2018, The Depository Trust Company (``DTC''), Fixed
Income Clearing Corporation (``FICC''), and National Securities
Clearing Corporation (``NSCC,'' and together with DTC and FICC, the
``Clearing Agencies'') filed with the Securities and Exchange
Commission (``Commission'') the proposed rule changes as described in
Items I, II and III below, which Items have been prepared primarily by
the Clearing Agencies. The Clearing Agencies filed the proposed rule
changes pursuant to Section 19(b)(3)(A) of the Act \3\ and Rule 19b-
4(f)(4) thereunder.\4\ The Commission is publishing this notice to
solicit comments on the proposed rule changes from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 15 U.S.C. 78s(b)(3)(A).
\4\ 17 CFR 240.19b-4(f)(4).
---------------------------------------------------------------------------
I. Clearing Agencies' Statement of the Terms of Substance of the
Proposed Rule Changes
The proposed rule changes consists of amendments to the Clearing
Agency Investment Policy (``Investment Policy'') of the Clearing
Agencies in order to (1) update the governance for changes to the
Investment Policy and provide for annual approval of the Investment
Policy by the Board of Directors of each of the Clearing Agencies
(collectively, ``Boards''); (2) revise the process for identifying an
applicable external credit rating for a potential investment
counterparty when there are discrepancies between available external
credit ratings for that potential counterparty; (3) amend the authority
to approve (a) the establishment of an investment relationship with an
investment counterparty, (b) investment transactions that exceed
applicable investment limits, and (c) investment
[[Page 67780]]
transactions in high grade corporate debt and U.S. Treasury securities;
and (4) make technical corrections and revisions to clarify and
simplify statements in the Investment Policy; as described in greater
detail below.
II. Clearing Agencies' Statement of the Purpose of, and Statutory Basis
for, the Proposed Rule Changes
In their filings with the Commission, the Clearing Agencies
included statements concerning the purpose of and basis for the
proposed rule changes and discussed any comments they received on the
proposed rule changes. The text of these statements may be examined at
the places specified in Item IV below. The Clearing Agencies have
prepared summaries, set forth in sections A, B, and C below, of the
most significant aspects of such statements.
(A) Clearing Agencies' Statement of the Purpose of, and Statutory Basis
for, the Proposed Rule Changes
1. Purpose
The Clearing Agencies are proposing to revise the Investment
Policy, which was adopted in December 2016 \5\ and are maintained in
compliance with Rule 17Ad-22(e)(16) under the Act.\6\
---------------------------------------------------------------------------
\5\ See Securities Exchange Act Release No. 79528 (December 12,
2016), 81 FR 91232 (December 16, 2016) (SR-DTC-2016-007, SR-FICC-
2016-005, SR-NSCC-2016-003).
\6\ 17 CFR 240.17Ad-22(e)(16). As discussed in this filing, the
Investment Policy also addresses compliance with the requirements of
Rule 17Ad-22(e)(3). 17 CFR 240.17Ad-22(e)(3).
---------------------------------------------------------------------------
Overview of the Investment Policy
The Investment Policy governs the management, custody and
investment of cash deposited to the respective NSCC and FICC Clearing
Funds, and the DTC Participants Fund,\7\ the proprietary liquid net
assets (cash and cash equivalents) of the Clearing Agencies, and other
funds held by the Clearing Agencies pursuant to their respective rules.
---------------------------------------------------------------------------
\7\ The respective Clearing Funds of NSCC and FICC, and the DTC
Participants Fund are described further in the Rules & Procedures of
NSCC (``NSCC Rules''), the DTC Rules, By-laws and Organization
Certificate (``DTC Rules''), the Clearing Rules of the Mortgage-
Backed Securities Division of FICC (``MBSD Rules'') or the Rulebook
of the Government Securities Division of FICC (``GSD Rules''),
respectively, available at https://dtcc.com/legal/rules-and-procedures. See Rule 4 (Clearing Fund) of the NSCC Rules, Rule 4
(Participants Fund and Participants Investment) of the DTC Rules,
Rule 4 (Clearing Fund and Loss Allocation) of the GSD Rules and Rule
4 (Clearing Fund and Loss Allocation) of the MBSD Rules.
---------------------------------------------------------------------------
The Investment Policy identifies the guiding principles for
investments and defines the roles and responsibilities of DTCC staff in
administering the Investment Policy pursuant to those principles. The
Investment Policy is co-owned by DTCC's Treasury group (``Treasury'')
\8\ and the Counterparty Credit Risk team (``CCR'') within DTCC's Group
Chief Risk Office (``GCRO'').\9\ Treasury is responsible for
identifying potential counterparties to investment transactions,
establishing and managing investment relationships with approved
investment counterparties, and making and monitoring all investment
transactions with respect to the Clearing Agencies. CCR is responsible
for conducting a credit review of any potential counterparty, updating
those reviews on a quarterly basis, and establishing an investment
limit for each counterparty.
---------------------------------------------------------------------------
\8\ Treasury is a part of the DTCC Finance Department and is
responsible for the safeguarding, investment and disbursement of
funds on behalf of the Clearing Agencies and in accordance with the
principles outlined in the Investment Policy.
\9\ Among other responsibilities, GCRO is generally responsible
for the systems and processes designed to identify and manage
credit, market and liquidity risks to the Clearing Agencies.
---------------------------------------------------------------------------
The Investment Policy also identifies sources of funds that may be
invested, and the permitted investments of those funds, including the
authority required to make such investments and the parameters of, and
limitations on, each type of investment. Allowable investments include
bank deposits, reverse repurchase agreements, direct obligations of the
U.S. government, money market mutual funds, high-grade corporate debt,
and hedge transactions. Finally, the Investment Policy defines the
approval authority required to exceed established investment limits.
Proposed Revisions to the Investment Policy
The Investment Policy is reviewed and approved by the Boards
annually. In connection with the most recent annual review of the
Investment Policy, the Clearing Agencies have decided to propose
certain revisions and updates. These proposed revisions, described in
greater detail below, are designed to update the Investment Policy and
help ensure that it continues to operate as intended.
1. Investment Policy Change Management and Annual Board Approval
The Clearing Agencies are proposing revisions to two aspects of
governance in the Investment Policy: (1) Approving changes to the
Investment Policy and (2) annual approval by the Board, as described
below.
a. Governance for Approving Changes to Investment Policy
Currently, the Investment Policy includes a statement that
``routine'' changes to the Investment Policy must be approved jointly
by an officer in Treasury and an officer in CCR, and that material
changes to the Investment Policy must be approved by the Boards, or
such committee as may be delegated authority by the Boards from time to
time.
The Boards have delegated to the General Counsel and the Deputy
General Counsels of the Clearing Agencies the authority to approve
certain proposed rule changes of the Clearing Agencies and the filings
with respect to such proposed rule changes required by Rule 19b-4 under
the Act.\10\ Specifically, the Boards have delegated to the General
Counsel and Deputy General Counsels of the Clearing Agencies authority
to approve (1) proposed rule changes that may be filed pursuant to
Section 19(b)(3)(A) of the Act,\11\ (2) proposed rule changes that
constitute clarifications, corrections or minor changes in the rules of
the Clearing Agencies but that will not be filed pursuant to Section
19(b)(3)(A) of the Act,\12\ in each case, other than any rule change
where the aggregate annual fees generated as a result of such rule
change are anticipated to be more than $1,000,000 at the time of the
filing, and (3) all proposed changes that are subject to an advance
notice as required by Rule 19b-4(n) under the Act \13\ but do not
constitute a change to the rules of Clearing Agencies.
---------------------------------------------------------------------------
\10\ 17 CFR 240.19b-4.
\11\ 15 U.S.C. 78s(b)(3)(A).
\12\ Id.
\13\ 17 CFR 240.19b-4(n).
---------------------------------------------------------------------------
Therefore, the statement within the Investment Policy that
``routine'' changes to the Investment Policy must be approved jointly
by an officer in Treasury and an officer in CCR, and that material
changes to the Investment Policy must be approved by the Boards or
committees of the Boards is inconsistent with these existing
delegations of approval authority. As such, the Clearing Agencies are
proposing to amend the Investment Policy to clarify that changes to the
Investment Policy may be approved by either (1) the Boards, (2) such
Board committees as may be delegated authority by the Boards from time
to time pursuant to their charters, or (3), with respect to certain
changes, the General Counsel or Deputy General Counsels of the Clearing
Agencies, pursuant to authority delegated by the
[[Page 67781]]
Boards and with the advice and direction of Treasury and CCR.
The proposed change would make the Investment Policy consistent
with existing internal delegations of authority and would also
facilitate expedited review and approval of changes that may not
require the review and approval of the Boards or committees of the
Boards.
b. Annual Approval of Investment Policy by Boards
The Investment Policy currently states that the Boards or such
committees as may be delegated authority from time to time shall review
the Investment Policy on an annual basis.
Rule 17Ad-22(e)(3) under the Act requires the Clearing Agencies to
maintain a sound risk management framework for comprehensively managing
the risks that arise in or are borne by the Clearing Agencies,
including investment and custody risks.\14\ Rule 17Ad-22(e)(3)(i) under
the Act requires that the risk management policies, procedures, and
systems that are maintained in compliance with Rule 17Ad-22(e)(3) be
subject to review on a specified periodic basis and be approved by the
Boards annually.\15\ As stated above, the Investment Policy governs the
management, custody and investment held by the Clearing Agencies, and
is maintained in order to manage the Clearing Agencies' investment and
custody risks, as required by Rule 17Ad-22(e)(3) under the Act.\16\
Therefore, the Investment Policy must be approved by the Boards
annually, as required by Rule 17Ad-22(e)(3)(i) under the Act.\17\
---------------------------------------------------------------------------
\14\ 17 CFR 240.17Ad-22(e)(3).
\15\ 17 CFR 240.17Ad-22(e)(3)(i).
\16\ 17 CFR 240.17Ad-22(e)(3).
\17\ 17 CFR 240.17Ad-22(e)(3)(i).
---------------------------------------------------------------------------
The Clearing Agencies are proposing to amend the Investment Policy
to provide that the Investment Policy shall be approved annually by the
Boards or such committees as may be delegated authority from time to
time.\18\ The proposed change would align the governance of the
Investment Policy with the applicable requirements of Rule 17Ad-
22(e)(3)(i) under the Act.\19\
---------------------------------------------------------------------------
\18\ Id.
\19\ Id.
---------------------------------------------------------------------------
2. Process for Identifying External Credit Rating of Potential
Investment Counterparties
One of the responsibilities of CCR under the Investment Policy is
to perform credit reviews of potential investment counterparties. The
credit review is used to determine if the Clearing Agencies should
establish an investment relationship with that entity, and what, if
any, limits should be placed on investments with that entity as an
investment counterparty. These credit reviews may include, for example,
a business description, identification of key risks and any mitigants
to those risks, a general financial analysis of the potential
counterparty, such counterparty's available external credit ratings,
and the recommended investment limit for such counterparty. The
Investment Policy sets a minimum external credit rating for potential
investment counterparties for specified types of investments. External
credit ratings may be assigned by either S&P Global Ratings, Moody's
Investors Service, Inc., or Fitch Ratings Inc.
Currently, the Investment Policy states that if there is a single
notch discrepancy between available external credit ratings, CCR shall
use the more favorable rating available. The Investment Policy further
states that, if there is a multiple notch discrepancy between available
external credit ratings for a potential investment counterparty, CCR
may use its discretion, based on information available to it, in
determining the applicable credit rating for its credit review of that
counterparty.
The Clearing Agencies are proposing to amend the Investment Policy
to remove CCR's discretion that may be used when there is a multiple
notch discrepancy between the external credit ratings, and instead
require that CCR shall use the rating that is one notch above the
lowest available external credit rating for that counterparty.
The Clearing Agencies determined that this approach would be
appropriate because credit ratings may be obtained from one of the
three credit rating agencies identified above, so there could only be a
maximum of three available credit ratings for an entity. As such, under
this proposed approach, the middle available rating would be applied
where there is a multiple notch discrepancy between available credit
ratings.
The Clearing Agencies believe the proposed change would improve the
process for applying an external credit rating in connection with
credit reviews because it would create a clear and objective approach
to identifying the applicable external credit rating in these
circumstances by removing CCR's discretion in determining which rating
to apply.
3. Approval Authority for Investments Relationships, Exceeding
Investment Limits and Certain Investment Transactions
The Investment Policy identifies the groups of individuals who have
the authority to approve (1) the establishment of an investment
relationship with an investment counterparty, (2) investment
transactions that exceed applicable investment limits, and (3)
investment transactions in high grade corporate debt and U.S. Treasury
securities. The Clearing Agencies are proposing to revise the approval
authority in the Investments Policy, as described below.
a. Focus the Approval Authority for Investments Relationships and
Exceeding Investment Limits to Managing Director in CCR
The Clearing Agencies are proposing to amend the authority for
approving the establishment of investment relationships and investment
transactions that exceed investment limits to restrict one of the
individuals authorized to provide such approvals to a Managing Director
in CCR, rather than any Managing Director in GCRO, for the reasons
described below.
First, with respect to the authority to establish an investment
relationship with an investment counterparty, the Investment Policy
currently identifies two groups of authorized individuals--``Group A''
and ``Group B''--and provides that an investment relationship may be
approved by either two individuals from Group A acting jointly, or by
one individual from Group A and one individual from Group B acting
jointly. Currently, Group A includes the Group Chief Risk Officer or a
Managing Director in the Financial Risk Management group (the former
name of the GCRO).\20\
---------------------------------------------------------------------------
\20\ As described below, the Clearing Agencies are proposing to
make a technical revision to the Investment Policy to update all
references to the Financial Risk Management group, or ``FRM,'' to
the Group Chief Risk Office, or ``GCRO.''
---------------------------------------------------------------------------
Second, with respect to approving investment transactions that
exceed applicable investment limits, the Investment Policy currently
identifies three groups of individuals--``Group A,'' ``Group B,'' and
``Group C''--and provides that an investment transaction that exceeds
applicable investment limits may be approved by either one individual
in Group A and one individual from Group B acting jointly; or one
individual in Group A or one individual in Group B, and one individual
in Group C, acting jointly. Currently, Group B includes both a
[[Page 67782]]
Managing Director in GCRO and the Group Chief Risk Officer.
The Clearing Agencies are proposing to limit the Managing Director
in GCRO who is authorized to provide these approvals to a Managing
Director in the CCR group within GCRO. As described above, CCR is
responsible for conducting the credit reviews of potential investment
counterparties, and for setting investment limits for investment
counterparties. Therefore, a Managing Director in CCR is more closely
involved in conducting credit reviews of potential investment
counterparties and setting investment limits that are appropriate based
on those reviews, where other Managing Directors within GCRO do not
have a role in the administration of the Investment Policy. Therefore,
the Clearing Agencies believe this proposed change is appropriate
because it would focus the authorization to an individual who may be
more capable of providing an informed authorization when necessary.
The Clearing Agencies are also proposing to provide that a Managing
Director in CCR may assign a delegate within CCR with the title of
Executive Director or higher, to jointly approve investment
transactions that exceed applicable limits in the event a CCR Managing
Director is unavailable. The approval of these transactions may be
required in a short timeframe. Therefore, the proposed change would
allow the Clearing Agencies to obtain these joint approvals from an
officer within CCR, when necessary, without unnecessary delay in the
event a Managing Director in CCR is not available to provide the
requested authorization.
b. Revising Approval Authority for Certain Investment Transactions
The Clearing Agencies are proposing to make two revisions to the
approval authority for investment transactions in high grade corporate
debt and U.S. Treasury securities, as described below.
Currently, the Investment Policy provides that investment
transactions in high grade corporate debt and U.S. Treasury securities
where the remaining time to maturity is two years or less must be
approved by two individuals, acting jointly, who are identified in a
group of individuals that includes both senior level executives and
lower level officers. The value of investments that mature on a longer
timeframe are subject to greater uncertainty over that period and such
investments are generally viewed as posing greater risk. Therefore, the
Investment Policy provides that investment transactions in high grade
corporate debt and U.S. Treasury securities where the remaining time to
maturity is more than two years must be approved by two individuals,
acting jointly, from the same group of individuals who are authorized
to approve such investments that mature on a shorter timeframe, so long
as at least one of those individuals is a senior level executive.
First, the Clearing Agencies are proposing to revise the scope of
investments that the two groups of individuals are authorized to
approve. The proposed change would provide the first group of
individuals with authority to approve investments, with two of them
acting jointly, for a time to maturity of one year or less, and would
provide the second group of individuals with authority to approve
investments with a time to maturity of greater than one year, and up to
a maximum of ten years for investments in U.S. Treasury securities and
up to a maximum of five years for investments in high grade corporate
debt. This proposed change would provide for a more conservative
approach to approving these investments by limiting the investments
that may be approved by the first group of authorized individuals to
only those that mature on a shorter timeframe, and pose less risk.
Second, the Clearing Agencies are proposing to include an Executive
Director in Finance in the first group of individuals, who are
authorized to act jointly to approve investment transactions with a
remaining time to maturity of one year or less. This proposed change
would provide the Clearing Agencies with more flexibility to authorize
investment transactions where the time to maturity is one year or less
by authorizing an additional officer to approve this revised set of
investments. The Investment Policy would continue to require that at
least one of the individuals who approve investments that have a longer
time to maturity be a senior level executive.
4. Technical Revisions
The Clearing Agencies are proposing to reorganize and reorder
certain sections of the Investment Policy, and make other updates,
corrections and clarifications, as described below.
a. Reordering and Reorganizing Certain Sections of the Investment
Policy
First, the Clearing Agencies are proposing to remove Section 1.1,
titled ``Document Control Information,'' from the Investment Policy.
The information under this heading would be incorporated into the
Overview in Section 1, and this proposed change would simplify the
organization of this Section.
Second, the Clearing Agencies are proposing to move the information
currently in Section 7 to other sections in the Investment Policy and
eliminate Section 7. Currently, Section 7.1 describes the
authorizations for establishing investment relationships, and Section
7.2 describes the authorizations for entering into investment
transactions. The information currently in Section 7.1 would be moved
to a new Section 4.3. This proposed change would revise the Investment
Policy so the authorizations for establishing investment relationships
appears directly after the description of credit reviews of potential
investment counterparties performed by CCR in Section 4.2.
The information currently in Section 7.2 would be moved to Section
6.2. This proposed change would revise the Investment Policy so the
authorizations for investment transactions appear in the same Section
as the description of the applicable investment type. As such, Sections
6.2.1, 6.2.2, and 6.2.4, which describe investments in bank deposits,
reverse repurchase agreements, and money market mutual funds,
respectively, would include a statement that investment transactions in
these investment types are authorized pursuant to Section 4.1 of the
Investment Policy and no separate approvals for such investment
transactions are required. Sections 6.2.3 and 6.2.5, which describe
investments in U.S. treasury securities and high-grade corporate debt,
respectively, would include a table of the required authorizations for
investment transactions in these investment types. The authorizations
described in these tables would be amended as described above. The
Investment Policy would also be updated to make conforming changes to
update internal cross-references to these reorganized Sections.
Third, the Clearing Agencies are proposing to revise Section 6.2.6,
which describes hedge transactions. The proposed change would move a
statement regarding factors that may be considered when authorizing a
hedge transaction to appear above the table of authorizations of those
transactions. This proposed change would align Section 6.2.6 to be
organized similarly to other subsections within Section 6.2, such that
the information regarding authorizations of those transactions appears
at the end of the subsection.
The Clearing Agencies believe each of the proposed changes are
appropriate. By reorganization the Investment Policy such that sections
regarding similar
[[Page 67783]]
matters appear together, the proposed changes would improve the clarity
of the Investment Policy.
b. Other Updates and Technical Revisions
The Clearing Agencies are also proposing to make other updates and
technical revisions to the Investment Policy. These technical revisions
would, for example, correct internal cross-references, revise the use
of defined terms, and clarify descriptions within the Investment
Policy, without changing the substantive statements being revised.
For example, Section 6.2.1 would be revised to include term
deposits in a list of types of bank deposit investment transactions
that may be executed pursuant to the Investment Policy. While the
existing list was intended to be non-exhaustive, the proposed change
would clarify that term bank deposits are also permitted. As another
example, the Investment Policy would be revised to reflect a change to
the name of the DTCC's Financial Risk Management group, or ``FRM,'' to
the GCRO.
The Clearing Agencies believe the proposed updates and technical
revisions would improve the clarity and accuracy of the Investment
Policy and, therefore, would facilitate the execution of the Investment
Policy.
2. Statutory Basis
The Clearing Agencies believe that the proposed rule changes are
consistent with the requirements of the Act and the rules and
regulations thereunder applicable to a registered clearing agency. In
particular, the Clearing Agencies believe that the proposed
modifications to the Investment Policy are consistent with Section
17A(b)(3)(F) of the Act \21\ and Rules 17Ad-22(e)(3)(i) and (16) under
the Act,\22\ for the reasons described below.
---------------------------------------------------------------------------
\21\ 15 U.S.C. 78q-1(b)(3)(F).
\22\ 17 CFR 240.17Ad-22(e)(3)(i) and (16).
---------------------------------------------------------------------------
Section 17A(b)(3)(F) of the Act requires, in part, that the rules
of each of the Clearing Agencies be designed to assure the safeguarding
of securities and funds which are in the custody or control of each of
the Clearing Agencies or for which they are responsible.\23\ The
investment guidelines and governance procedures set forth in the
Investment Policy are designed to safeguard funds which are in the
custody or control of the Clearing Agencies or for which they are
responsible. Such protections include, for example, following a prudent
and conservative investment philosophy that places the highest priority
on maximizing liquidity and risk avoidance. The Clearing Agencies
believe each of these proposed changes would help facilitate the
effective execution of the Investment Policy pursuant to the guiding
principle set forth therein. Therefore, the Clearing Agencies believe
the proposed changes would allow the Clearing Agencies to continue to
operate the Investment Policy pursuant to a prudent and conservative
investment philosophy that assures the safeguarding of securities and
funds which are in their custody and control, or for which they are
responsible.
---------------------------------------------------------------------------
\23\ 15 U.S.C. 78q-1(b)(3)(F).
---------------------------------------------------------------------------
First, the Clearing Agencies believe the proposed changes to the
Investment Policy governance would improve the processes for
maintaining the Investment Policy and ensuring it continues to operate
as intended. The proposed changes to reflect the existing delegation of
authority to the General Counsel and Deputy General Counsels of the
Clearing Agencies to approve certain changes to the Investment Policy
would align this process to existing governance and delegations of
authority within the Clearing Agencies. This proposed change would
permit an expedited review and approval of changes that do not require
action by the Boards or Board committees. In this way, the Clearing
Agencies believe the proposed change would simplify the steps necessary
for the Clearing Agencies to make certain non-material changes to the
Investment Policy, subject to required regulatory review and approval
of such changes. Meanwhile, the Clearing Agencies believe that the
proposed change to require annual approval of the Investment Policy
would provide for stronger Board oversight and create an important
control over the Investment Policy's effectiveness.
Second, the Clearing Agencies believe the proposed change to the
process for identifying an applicable external credit rating for
potential investment counterparties when there is a multiple notch
discrepancy between available ratings would improve the credit reviews
of those entities. The proposed change would improve credit reviews by
creating a more objective approach to this aspect of those reviews and
creating more consistency in the evaluation of these entities.
Understanding the risks that may be presented by an investment
counterparty is an important aspect of the Investment Policy's
guidelines and governance procedures that are designed to safeguard
funds which are in the custody or control of the Clearing Agencies or
for which they are responsible.
Third, the Clearing Agencies believe the proposed change to certain
approval authority within the Investment Policy would both enable the
Clearing Agencies to authorize those individuals who are involved with
the matters that they may be asked to approve, and would facilitate
those approvals by authorizing additional individuals to approve lower
risk matters. The proposed change to the approval authority for
establishing investment relationships and entering investment
transactions that exceed applicable limits to include only Managing
Directors in CCR would refine this approval authority to individuals
who are involved in these matters, and may be better able to provide an
informed approval. The proposed change to the approval authority for
investment transactions with maturity time would shift that authority
to senior executives for investments that pose greater risk, creating a
more conservative approach to those approvals. The proposed change to
authorize Executive Directors in Finance to approve investment
transactions with remaining time to maturity of less than one year
would facilitate the approval of these transactions that pose less risk
to the Clearing Agencies.
Finally, the Clearing Agencies believe the proposed changes to
reorganize certain sections within the Investment Policy and the
proposed updates and technical revisions to the Investment Policy would
improve the clarity and accuracy of the Investment Policy. By creating
clearer descriptions, the Clearing Agencies believe these proposed
changes would make the Investment Policy more effective in governing
the management, custody, and investment of funds of and held by the
Clearing Agencies.
For the reasons described above, the Clearing Agencies believe the
proposed changes would improve the effectiveness of the Investment
Policy and allow the Investment Policy to continue to be administered
in alignment with the investment guidelines and governance procedures
set forth therein. Given that such guidelines and governance procedures
are designed to safeguard funds which are in the custody or control of
the Clearing Agencies or for which they are responsible, the Clearing
Agencies believe the proposed changes are consistent with the
requirements of Section 17A(b)(3)(F) of the Act.\24\
---------------------------------------------------------------------------
\24\ Id.
---------------------------------------------------------------------------
Rule 17Ad-22(e)(3)(i) requires, in part, that the Clearing Agencies
establish, implement, maintain and
[[Page 67784]]
enforce written policies and procedures reasonably designed to maintain
a sound risk management framework for comprehensively managing
investment and custody risks that arise in or are borne by the Clearing
Agencies, which includes risk management policies, procedures, and
systems designed to identify, measure, monitor, and manage the range of
risks that arise in or are borne by the Clearing Agencies, that are
subject to review on a specified periodic basis and approved by the
board of directors annually.\25\ The Clearing Agencies are proposing to
revise the Investment Policy to require that it be reviewed and
approved by the Boards, or an authorized Board Committee, at least
annually. The Boards, or an authorized Board Committee, will be
provided with a copy of the Investment Policy at a regularly scheduled
meeting, along with a memorandum describing any changes that had been
made to the Investment Policy since its last annual approval. This
proposed change would provide for important oversight of the operation
of the Investment Policy and its continued effectiveness in governing
the management, custody and investment of funds held by the Clearing
Agencies. The proposed change is also designed to align the governance
of the Investment Policy with the applicable requirements of Rule 17Ad-
22(e)(3)(i) under the Act.\26\
---------------------------------------------------------------------------
\25\ 17 CFR 240.17Ad-22(e)(3)(i).
\26\ Id.
---------------------------------------------------------------------------
Rule 17Ad-22(e)(16) under the Act requires the Clearing Agencies to
establish, implement, maintain and enforce written policies and
procedures reasonably designed to safeguard the Clearing Agencies' own
and their participants' assets, minimize the risk of loss and delay in
access to these assets, and invest such assets in instruments with
minimal credit, market, and liquidity risks.\27\
---------------------------------------------------------------------------
\27\ 17 CFR 240.17Ad-22(e)(16).
---------------------------------------------------------------------------
The Clearing Agencies believe that the Investment Policy follows a
prudent and conservative investment philosophy, placing the highest
priority on maximizing liquidity and avoiding risk of loss, by
requiring the segregation of funds of each Clearing Agency and of types
of funds of each Clearing Agency, using external credit ratings in the
evaluation of counterparties, and establishing investment limits by
counterparty as well as investment type. As originally implemented, the
Investment Policy was designed to meet the requirements of Rule 17Ad-
22(e)(16) under the Act.\28\
---------------------------------------------------------------------------
\28\ Id.
---------------------------------------------------------------------------
For the reasons stated above, the Clearing Agencies believe that
each of the proposed revisions would improve the administration of the
Investment Policy and would make the Investment Policy more effective
in governing the management, custody, and investment of funds of and
held by the Clearing Agencies. In this way, the proposed changes would
better allow the Clearing Agencies to maintain these documents in a way
that is designed to meet the requirements of Rule 17Ad-22(e)(16).
Therefore, the Clearing Agencies believe the proposed revisions would
be consistent with the requirements of Rule 17Ad-22(e)(16) under the
Act.\29\
---------------------------------------------------------------------------
\29\ Id.
---------------------------------------------------------------------------
(B) Clearing Agencies' Statement on Burden on Competition
Each of the Clearing Agencies believes that none of the proposed
revisions to the Investment Policy would have any impact, or impose any
burden, on competition. The Investment Policy applies equally to the
Clearing Fund and Participants Fund deposits, as applicable, of each
member of the Clearing Agencies, and establishes a uniform policy at
the Clearing Agencies. The proposed changes to the Investment Policy
would not affect any changes on the fundamental purpose or operation of
this document and, as such, would also not have any impact, or impose
any burden, on competition.
(C) Clearing Agencies' Statement on Comments on the Proposed Rule
Changes Received From Members, Participants, or Others
The Clearing Agencies have not solicited or received any written
comments relating to this proposal. The Clearing Agencies will notify
the Commission of any written comments received by the Clearing
Agencies.
III. Date of Effectiveness of the Proposed Rule Changes, and Timing for
Commission Action
The foregoing rule changes have become effective pursuant to
Section 19(b)(3)(A) of the Act \30\ and paragraph (f) of Rule 19b-4
thereunder.\31\ At any time within 60 days of the filing of the
proposed rule change, the Commission summarily may temporarily suspend
such rule changes if it appears to the Commission that such action is
necessary or appropriate in the public interest, for the protection of
investors, or otherwise in furtherance of the purposes of the Act.
---------------------------------------------------------------------------
\30\ 15 U.S.C. 78s(b)(3)(A).
\31\ 17 CFR 240.19b-4(f).
---------------------------------------------------------------------------
IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
changes are consistent with the Act. Comments may be submitted by any
of the following methods:
Electronic Comments
Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to rule-comments@sec.gov. Please include
File Number SR-DTC-2018-012, SR-FICC-2018-014, or SR-NSCC-2018-013 on
the subject line.
Paper Comments
Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549.
All submissions should refer to File Number SR-DTC-2018-012, SR-FICC-
2018-014, or SR-NSCC-2018-013. One of these file numbers should be
included on the subject line if email is used. To help the Commission
process and review your comments more efficiently, please use only one
method. The Commission will post all comments on the Commission's
internet website (https://www.sec.gov/rules/sro.shtml). Copies of the
submissions, all subsequent amendments, all written statements with
respect to the proposed rule changes that are filed with the
Commission, and all written communications relating to the proposed
rule changes between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for website viewing and printing in
the Commission's Public Reference Room, 100 F Street NE, Washington, DC
20549 on official business days between the hours of 10:00 a.m. and
3:00 p.m. Copies of the filings also will be available for inspection
and copying at the principal office of the Clearing Agencies and on
DTCC's website (https://dtcc.com/legal/sec-rule-filings.aspx). All
comments received will be posted without change. Persons submitting
comments are cautioned that we do not redact or edit personal
identifying information from comment submissions. You should submit
only information that you wish to make available publicly. All
submissions should refer to File Number SR-DTC-2018-012, SR-FICC-2018-
014, or SR-NSCC-2018-013 and should be submitted on or before January
22, 2019.
[[Page 67785]]
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\32\
---------------------------------------------------------------------------
\32\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2018-28378 Filed 12-28-18; 8:45 am]
BILLING CODE 8011-01-P