DTCC Pledges Compliance with SEC’s New Treasury Regulations

<p>DTCC has issued a statement in light of the recent amendments
introduced by the Securities and Exchange Commission (SEC), set to significantly
impact the US Treasury market. </p><p>DTCC has mentioned in a statement published on its website that it is taking the necessary measures to align with these amendments. The organization aims to facilitate
discussions, offer guidance, and disseminate important information for the market participants
navigating these changes. </p><p>These amendments bring forth added regulatory clarity,
outlining extensive clearing requirements and defining implementation
timelines. The implications of these regulations are poised to shape the future of
the US Treasury cash and repo markets. The regulator requires a substantial portion of
secondary market transactions to be centrally cleared by specified deadlines.</p><p>SEC Stipulates Deadlines for Clearing Transactions</p><p>These rules, published by the SEC on December 13, mandate clearinghouses to expand the
scope of cleared transactions. They emphasize the necessity for members to clear
all repo and reverse repo transactions. According to the regulator, this mandate aims to address
the growing volume of transactions to enhance market resilience and reduce risk.</p><p>These rules outline a phased implementation over
two-and-a-half years, stressing cooperation and coordination with entities like
the Federal Reserve, the US Department of the Treasury, and the <a href="https://www.financemagnates.com/tag/cftc/" target="_blank" rel="follow">Commodity Futures Trading Commission</a>. </p><p>The <a href="https://www.financemagnates.com/tag/sec/" target="_blank" rel="follow">SEC</a>'s amended rules, designed to expand US
Treasury <a href="https://www.financemagnates.com/terms/c/clearing/">clearing</a>, set stringent timelines for compliance. By December 31,
2025, cash transactions, particularly eligible secondary market transactions,
must undergo central clearing. Additionally, the deadline for repo transactions
stands at June 30, 2026. </p><p>These regulations, aimed at enhancing efficiency,
competition, and resilience, occur as a significant milestone in the evolution
of the capital markets, particularly the $26 trillion Treasury market.</p><p>By implementing these regulations, the SEC aims to bolster
customer protection and market competition by altering margin posting
protocols. Entities will no longer be able to net customers' positions against
their proprietary positions. This ensures increased safeguards for customers and
the clearinghouses. </p><p>DTCC Expands Services</p><p>Recently, DTCC<a href="https://www.financemagnates.com/institutional-forex/dtcc-takes-otc-derivatives-data-access-to-the-cloud/" target="_blank" rel="follow"> introduced a cloud-based service</a>
aimed at streamlining data access for real-time insights to investors in the
derivatives markets. Dubbed OTC Direct Connect, this service aims to enable access to critical market data, enhancing users' ability to mitigate risks associated with
trading activities. </p><p>The landscape of OTC derivatives regulation is
evolving globally, with a recent comprehensive <a href="https://www.financemagnates.com/institutional-forex/canada-adopts-international-standards-to-regulate-derivatives-dealers/" target="_blank" rel="follow">rule introduced by Canadian securities regulators</a>. This rule aims to enhance transparency, accountability,
and ethical practices within Canada's OTC derivatives market, mirroring
international standards.</p>

This article was written by Jared Kirui at www.financemagnates.com.