Federal Register #SR-LCH SA-2026-003

SEC Notice: Expansion of Eligible Collateral for CDSClear to Additional U.S. Treasury Securities

This SEC notice details a proposed rule change by LCH SA to expand eligible collateral for CDSClear Clearing Members: - Government Buyer: - Securities and Exchange Commission (SEC) - LCH SA (Banque Centrale de Compensation) as the clearing agency - OEMs and Vendors: - U.S. Treasury (issuer of eligible securities) - LCH SA (clearing agency) - Products/Services Requested: - Expansion of eligible collateral to include: - U.S. Treasury Notes - U.S. Treasury Bonds - U.S. Treasury Floating Rate Notes (FRNs) - U.S. Treasury Inflation Protected Securities (TIPS) - (Currently accepted: U.S. Treasury Bills) - No specific part numbers or quantities; applies to all qualifying securities - Unique or Notable Requirements: - New concentration limits and haircuts for these securities - Eligibility criteria include minimum outstanding amounts and maturity requirements - Changes are subject to regulatory approval - Aimed at improving liquidity management and supporting CDSClear's U.S. business expansion - No physical procurement; this is a regulatory eligibility change for collateral types

Description

The Securities and Exchange Commission has filed a proposed rule change by LCH SA to extend the eligible collateral to include U.S. Treasury securities such as Notes, Bonds, Floating Rate Notes, and Treasury Inflation Protected Securities. This change aims to enhance the collateral framework and improve liquidity management for CDSClear Clearing Members by expanding the pool of high-quality liquid assets. The proposal includes amendments to concentration limits and haircuts to manage risk and ensure compliance with regulatory standards. The implementation is contingent on receiving all necessary regulatory approvals.

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