MFA submitted a letter to the Securities and Exchange Commission (SEC) in supports the LCH Exemption Request to expand the scope of products that LCH SA can make available to U.S. persons, including permitting U.S. persons to participate in RepoClear.
The following points are made in favor of the Exemption Request:
- The Request promotes efficient cross-border clearing and risk management: Central clearing is a foundational tool for mitigating counterparty credit risk, promoting market stability, and enhancing transparency.
- The Request is carefully structured and includes robust safeguards: The LCH Exemption Request is appropriately narrow and includes meaningful conditions that preserve Commission oversight and investor protections.
- Expanding access promotes competition and aligns with global practice: Granting the requested relief would also promote competition in clearing markets and align U.S. policy with global market structure realities.
- The Request supports market resilience without expanding systemic risk: The Commission specifically solicits comment on whether the requested relief would affect investor protection and the public interest. In MFA’s view, the proposal supports both.
