US Reg Round Up: 30/10/2024
Federal Reserve
Minutes of the Board’s discount rate meetings on September 9 and 18, 2024 - 15 October 2024
In a recent meeting, the Federal Reserve Board reviewed economic conditions and decided to maintain the primary credit rate at 5.5%. Directors noted improvements in labor availability and moderate wage growth but observed increased consumer price sensitivity. No changes to the primary credit rate were deemed necessary at this time. The secondary credit rate will remain 50 basis points above the primary rate, while the seasonal credit rate will be adjusted bi-weekly based on an established formula.
Federal Reserve agencies will support financial institutions affected by Hurricane Milton - 15 October 2024
The Federal Deposit Insurance Corporation, Federal Reserve Board, and other regulatory agencies are aiding financial institutions impacted by Hurricane Milton. They encourage these institutions to meet the financial needs of their communities and work constructively with affected borrowers by adjusting loan terms without fear of examiner criticism. For institutions facing operational challenges, regulators will expedite requests to operate temporary facilities. Agencies will also be flexible regarding compliance with publishing and regulatory reporting requirements due to disaster-related difficulties, expecting no penalties for reasonable efforts to comply. Financial institutions can receive Community Reinvestment Act credit for supporting recovery in disaster areas and are advised to monitor municipal securities and loans affected by the hurricane.
Securities and Exchange Commission
SEC adopts new rules for covered clearing agencies - 25 October 2024
The SEC has adopted rule amendments and a new rule aimed at enhancing the resilience and recovery planning of covered clearing agencies. Key updates include requirements for intraday margin collection and substantive inputs for risk-based margin models. Chair Gary Gensler emphasized that these changes will benefit investors and markets by improving operational continuity. The amendments mandate that covered clearing agencies develop policies for ongoing intraday exposure monitoring and establish protocols for making intraday margin calls based on risk thresholds. Additionally, the new rule requires covered clearing agencies to have recovery and wind-down plans detailing essential elements like scenario identification, implementation timelines, and board approval processes. Compliance deadlines are set for 150 days and 390 days after publication in the Federal Register for proposed changes to take effect.
SEC small business capital formation advisory committee meeting agenda released - 25 October 2024
The SEC’s Small Business Capital Formation Advisory Committee will meet on November 13, 2024, to discuss venture capital fundraising, focusing on challenges for emerging and diverse fund managers. The meeting will feature insights from Professor Sabrina Howell of NYU, who will present research on fundraising strategies, including public advertising. SEC staff will provide an overview of the registration framework for private fund advisers, highlighting exemptions that benefit emerging managers.
SEC division of examinations announces 2025 priorities - 21 October 2024
The SEC’s Division of Examinations has released its 2025 examination priorities, focusing on potential risks in U.S. capital markets. Key areas include fiduciary duty, standards of conduct, cybersecurity, and artificial intelligence. SEC Chair Gary Gensler emphasized that these priorities enhance market trust and protect investors by ensuring compliance with established rules. The Division will continue examining investment advisers, broker-dealers, and other entities for compliance with federal securities laws, particularly in areas presenting heightened risks. While the priorities provide a framework for compliance, they do not encompass all focus areas for the upcoming year, which will also consider additional risk factors specific to each entity.