• IEF2 Impact Due to Recent CFTC Staff Interpretation on Prime Money Market Funds

      • To
      • Clearing Member Firms; Chief Financial Officers; Back Office Managers
      • From
      • CME Clearing
      • #
      • 16-333
      • Notice Date
      • 23 August 2016
      • Effective Date
      • 23 August 2016
    • On August 8, 2016, staff of the Commodity Futures Trading Commission’s Division of Clearing and Risk released an interpretation concerning the impact of new Securities Exchange Commission (SEC) regulations that, as part of a more comprehensive reform effort, require the boards of directors of prime money market funds to have discretion, under certain circumstances, to temporarily suspend redemptions in such funds. In staff’s view, when these discretionary redemption gates take effect on October 14, 2016, prime funds and government funds electing to have this discretion would cease to be eligible as margin collateral for a derivatives clearing organization.

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