Regulatory Alerts2023-08-18 | Regulatory Notice 23-14Added · Updated
Amendments to Covered Agency Transaction Requirements under FINRA Rule 4210; Announcement of Effective Date
FINRA has amended FINRA Rule 4210 to eliminate the two percent maintenance margin requirement for Covered Agency Transactions, applying uniform mark-to-market loss margin collection to both exempt and non-exempt accounts. The amendments permit members to deduct unmargined excess net mark-to-market losses from net capital instead of collecting margin, subject to a $25 million aggregate limit and a $30 million or 25% tentative net capital threshold that triggers restrictions on new transactions. These changes, approved by the SEC on July 27, 2023, become effective on May 22, 2024, and include streamlined definitions for small cash counterparties and revised timelines for obtaining margin.
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