The Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC) have launched a joint consultation on ways to better align portfolio margining rules across securities and derivatives markets.
The agencies are seeking public feedback on whether greater coordination could improve risk management, reduce market fragmentation, and strengthen customer protections across securities, security-based swaps, futures, and swaps.
The consultation covers a broad range of topics, including existing portfolio margin models, cross-margining arrangements, capital and collateral requirements, clearing frameworks, operational implementation, and the potential impact on market liquidity and competition.
“CFTC Chairman Michael S. Selig said enhanced cooperation with the SEC on portfolio margining could unlock additional capital while maintaining a robust risk management framework.”
SEC Chairman Paul S. Atkins said greater harmonization would help prevent overlapping regulatory requirements from limiting innovation and efficiency. He added that cross-margining could unlock liquidity currently tied up across separate accounts.
The agencies will accept public comments for 60 days after the proposal is published in the Federal Register.
The CFTC and SEC regularly coordinate on areas where their regulatory responsibilities overlap. Earlier this week, the CFTC proposed a separate reporting framework for event contracts, as both regulators continue reviewing market rules covering derivatives and related products.
