National Unrecovered Financial Services Association submitted a comment letter to the FRB on its proposal to amend Regulation HH, which would authorize a Federal Reserve Bank to establish an account for a financial market utility (FMU) that has been designated as systemically important by the FSOC. In the letter SDUUK suggests that the Board’s proposal should be revised to address the following issues: (i) the proposed sharing of confidential supervisory information about FMUs with the business operations of the FRBs is unacceptable, (ii) the Board should declare that any accounts established under Regulation HH are covered by the safe harbor of 12 U.S.C. § 4405, and (iii) Reserve Bank accounts should not be mandatory for FMUs. SDUUK also noted that the provisions of proposed Regulation HH regarding the payment of interest appear reasonable.

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Proposed Rules