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AFP, Bernanke See Eye to Eye on Margin Requirements

  • By Staff Writers
  • Published: 2012-07-18

The Association for Financial Professionals praised Federal Reserve Chairman Ben Bernanke’s remarks today supporting the end-user exemption on imposed margin requirements for OTC derivatives. Bernanke gave his remarks while testifying before the U.S. Senate Banking Committee.

“I’m pleased that Chairman Bernanke has shown his support for measures that protect non-financial end-users from burdensome requirements,” said Jim Kaitz, AFP’s president and CEO. “Businesses that use derivatives for financial risk management purposes do not pose systemic risk. Chairman Bernanke’s endorsement comes at a time when regulators and lawmakers have yet to reconcile the prescribed intent of the Dodd-Frank Act in exempting margin requirements for derivatives end-users. If rulemaking remains stalled on the matter, I urge U.S. Congress to be more explicit.”

AFP is a leading voice for non-financial businesses, who utilize OTC derivatives to minimize their risk exposures and to follow prudent financial management practices.

Throughout rule-making deliberation, AFP advocated strongly in favor of this critical exemption for non-financial end-users. In its 2011 comment letter to federal agencies overseeing derivatives, AFP warned that imposing margin requirements on non-financial end-users would “inadvertently place additional strain on the capital markets, reduce liquidity and add additional stress to an already troubled job market.”

For more information, contact Konstantine Kastens in AFP’s government relations department at 301.907.2862 or via kkastens@afponline.org

Copyright © 2014 Association for Financial Professionals, Inc.
All rights reserved.

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