Federal Register / Vol. 62, No. 164 / Monday, August 25, 1997 / Notices 44997

1 15 U.S.C. 78s(b)(1).

2The Commission has modified the text of the

summaries submitted by DTC.

3Letter from Robert L.D. Colby, Deputy Director,

Division of Market Regulation, Commission, to Paul

Saltzman, Senior Vice President and General

Counsel, PSA The Bond Market Association,

(January 17, 1997); letter from Richard L. Gregg,

Commissioner, Bureau of the Public Debt,

Department of the Treasury, to Michael A.

Macchiaroli, Associate Director, Division of Market

Regulation, Commission (January 17, 1997).

4PSA The Bond Market Association Trading

Practice Guidelines for Inflation Indexed Securities

(December 18, 1996).

5 15 U.S.C. 78q–1.

EXHIBIT 1.—TRANSFER AGENT DROP SERVICE FEES

Type of service Present fee New fee

Monthly Service Charge ........................................................................................................................... $250.00 $500.00

Window Tickets Issued ............................................................................................................................ .75 1.00

Microfilming (Per Hour) ............................................................................................................................ 14.50 15.00

Microfilming Securities (Per Roll) ............................................................................................................. 15.75 16.00

Dividend Reinvestment Plan Voluntary Contributions (Window Ticket Per Check) ................................ .75 1.00

Wire Transfer Service (Window Ticket Per Check) ................................................................................. .75 1.00

Check Collection (Window Ticket Per Check) ......................................................................................... .75 1.00

Routing Envelopes (Window Ticket Per Check) ...................................................................................... .75 1.00

Daily Valuation (Daily Flat Fee) ............................................................................................................... 175.00 1 25.00 to 175.00

Midnight Closings (Per Occurrence) ........................................................................................................ 1,000.00 1,000.00

1 Depending on number of issues and activity.

[FR Doc. 97–22525 Filed 8–22–97; 8:45 am]

BILLING CODE 8010–01–M

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–38950; File No. SR–DTC–

97–07]

Self-Regulatory Organizations; The

Depository Trust Company; Notice of

Filing of a Proposed Rule Change

Relating to Disclosure Requirements

for Transactions Involving Inflation

Indexed Securities through the

Institutional Delivery System

August 19, 1997.

Pursuant to Section 19(b)(1) of the

Securities Exchange Act of 1934

(‘‘Act’’),1 notice is hereby given that on

May 19, 1997, The Depository Trust

Company (‘‘DTC’’) filed with the

Securities and Exchange Commission

(‘‘Commission’’) the proposed rule

change (File No. SR–DTC–97–07) as

described in Items I, II, and III below,

which items have been prepared

primarily by DTC. The Commission is

publishing this notice to solicit

comments on the proposed rule change

from interested persons.

I. Self-Regulatory Organization’s

Statement of the Terms of Substance of

the Proposed Rule Change

The purpose of the proposed rule

change is to amend Section M of DTC’s

participant operating procedures in

accordance with certain disclosure

requirements for transactions involving

inflation indexed securities processed

through DTC’s Institutional Delivery

(‘‘ID’’) system.

II. Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

In its filing with the Commission,

DTC included statements concerning

the purpose of and basis for the

proposed rule change and discussed any

comments that it received on the

proposed rule change. The text of these

statements may be examined at the

places specified in Item IV below. DTC

has prepared summaries, set forth in

sections (A), (B), and (C) below, of the

most significant aspects of such

statements.2

(A) Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

PSA The Bond Market Trade

Association (‘‘PSA’’) on behalf of its

members and all other registered

brokers and dealers, received no-action

and interpretive relief from the

Commission and the Treasury

(collectively ‘‘interpretive relief’’) 3

regarding the application of certain

regulations to inflation indexed

securities issued by the U.S. Treasury

Department (‘‘Treasury’’). The purpose

of the proposed rule change is to enable

broker-dealers that use DTC’s ID system

for generating confirmations for their

customer transactions to comply with

the disclosure requirements set forth in

the interpretative relief.

The interpretative relief requires

broker-dealers to disclose in

confirmations for inflation indexed

securities that yield to maturity may

vary due to inflation adjustments or

provide disclosure to similar effect. A

broker-dealer using the ID system can

enter data in the security type field

identifying the security as an inflation

indexed security by using a designated

acronym (i.e., ‘‘ITS’’). Under the

proposed rule change, DTC will add

procedures to its ID system to provide

that when the designated acronym

identifying an inflation indexed security

appears in the security type field of the

ID confirmation, the required disclosure

will be deemed to be a part of the ID

confirmation for that transaction.

The interpretative relief also requires

confirmations involving inflation

indexed securities for when-issued

transactions and for transactions in the

Treasury’s Separate Trading of

Registered Interest and principal of

Securities (‘‘STRIPS’’) program to

disclose the real yield (i.e., nominal

yield not adjusted for inflation) for the

securities.4 Under the proposed rule

change, a broker-dealer using the ID

system to send confirmations for such

transactions will be able to disclose the

real yield by entering that figure either

in the yield field or in the special

instructions field of trade data

submitted to the ID system.

DTC believes the proposed rule

change is consistent with the

requirements of Section 17A of the Act 5

and the rules and regulations

thereunder because the proposed rule

change will assure the safeguarding of

securities and funds which are in the

custody or control of DTC by facilitating

the confirmation of transactions in

inflation indexed securities through the

use of DTC’s system.

(B) Self-Regulatory Organization’s

Statement on Burden on Competition

DTC perceives no impact on

competition by reason of the proposed

rule change.
44998 Federal Register / Vol. 62, No. 164 / Monday, August 25, 1997 / Notices

6 17 CFR 200.30–3(a)(12).

1 15 U.S.C. 78s(b)(1).

2The Commission has modified the text of the

summaries prepared by OCC.

3 17 CFR 240.15c3–1(e)(1)(iv). Rule 15c3–1(e)

requires broker-dealers to provide written notice to

the Commission in connection with certain

transactions involving a significant withdrawal of

equity capital.

4 15 U.S.C. 78c(a).

5 17 CFR 1.3(d).

(C) Self-Regulatory Organization’s

Statement on Comments on the

Proposed Rule Change Received From

Members, Participants, or Others

The proposed rule change was

developed through discussions with

PSA acting on behalf of its members and

with several participants. Written

comments from DTC participants or

others have not been solicited or

received on the proposed rule change.

III. Date of Effectiveness of the

Proposed Rule Change and Timing for

Commission Action

Within thirty-five days of the date of

publication of this notice in the Federal

Register or within such longer period (i)

as the Commission may designate up to

ninety days of such date if it finds such

longer period to be appropriate and

publishes its reasons for so finding or

(ii) as to which DTC consents, the

Commission will:

(A) By order approve such proposed

rule change or,

(B) Institute proceedings to determine

whether the proposed rule change

should be disapproved.

IV. Solicitation of Comments

Interested persons are invited to

submit written data, views, and

arguments concerning the foregoing.

Persons making written submissions

should file six copies thereof with the

Secretary, Securities and Exchange

Commission, 450 Fifth Street, NW.,

Washington, DC 20549. Copies of the

submission, all subsequent

amendments, all written statements

with respect to the proposed rule

change that are filed with the

Commission, and all written

communications relating to the

proposed rule change between the

Commission and any person, other than

those that may be withheld from the

public in accordance with the

provisions of 5 U.S.C. 552, will be

available for inspection and copying in

the Commission’s Public Reference

Room, 450 Fifth Street, NW.,

Washington, DC 20549. Copies of such

filing will also be available for

inspection and copying at the principal

office of DTC. All submissions should

refer to the file number SR–DTC–97–07

and should be submitted by September

15, 1997.

For the Commission by the Division of

Market Regulation, pursuant to delegated

authority.6

Margaret H. McFarland,

Deputy Secretary.

[FR Doc. 97–22526 Filed 8–22–97; 8:45 am]

BILLING CODE 8010–01–M′

SECURITIES AND EXCHANGE

COMMISSION

[Release No. 34–38948; File No. SR–OCC–

97–05]

Self-Regulatory Organizations; The

Options Clearing Corporation; Notice

of Filing of Proposed Rule Change

Relating to Early Warning Notices

August 19, 1997.

Pursuant to Section 19(b)(1) of the

Securities Exchange Act of 1934

(‘‘Act’’) 1, notice is hereby given that on

May 15, 1997, The Options Clearing

Corporation (‘‘OCC’’) filed with the

Securities and Exchange Commission

(‘‘Commission’’) the proposed rule

change as described in Items I, II, and

III below, which items have been

prepared primarily by OCC. The

Commission is publishing this notice to

solicit comments from interested

persons on the proposed rule change.

I. Self-Regulatory Organization’s

Statement of the Terms of Substance of

the Proposed Rule Change

The purpose of the proposed rule

change is to revise OCC’s Rule 303 to

expand the circumstances under which

a clearing member is to provide OCC

with early warning notices.

II. Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

In its filing with the Commission,

OCC included statements concerning

the purpose of and basis for the

proposed rule change and discussed any

comments it received on the proposed

rule change. The text of these statements

may be examined at the places specified

in Item IV below. OCC has prepared

summaries, set forth in sections (A), (B),

and (C) below, of the most significant

aspects of such statements.2

(A) Self-Regulatory Organization’s

Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule

Change

The purpose of the proposed rule

change is to revise OCC’s Rule 303 to

expand the circumstances under which

a clearing member is to provide OCC

with early warning notices. Currently,

Rule 303 requires a clearing member to

provide OCC with an early warning

notice if it experiences certain

enumerated financial difficulties or if it

has provided any notice required

pursuant to Commission Rule 15c3–

1(e)(1)(iv).3 Specifically, Rule 303

would be expanded to explicitly

provide that a clearing member must

immediately notify an officer of OCC of

any notice that such clearing member

gives, is required to give, or receives

from any regulatory organization

regarding any financial difficulty

affecting the clearing member or of any

failure by the clearing member to be in

compliance with the financial

responsibility rules or capital

requirements of any regulatory

organization. As proposed, Rule 303

would require the clearing member to

promptly confirm such notice in

writing. In addition, the lead-in

language of (b) and (c) of Rule 303 (as

relettered) will be revised to conform to

the requirement in new paragraph

303(a) that an officer of OCC be notified

by telephone of any notice described in

the paragraph.

The term ‘‘regulatory organization’’

will be defined in proposed

Interpretations and Policies .01 to mean

(i) the Commission and any other

federal or state regulatory agency having

jurisdiction over the clearing member

including the Commodity Futures

Trading Commission (‘‘CFTC’’) in the

case of a clearing member which is

subject to the jurisdiction of the CFTC;

(ii) any self-regulatory organization as

defined in Section 3(a) of Act 4 of which

the clearing member is a member or

participant; (iii) any clearing

organization, as defined in Regulation

Section 1.3(d) under the Commodity

Exchange Act,5 board of trade, contract

market, and registered futures

association of which the clearing

member is a member or participant; and

(iv) in the case of a non-U.S. clearing

member, any non-U.S. regulatory agency

or instrumentality or independent

organization or exchange having

jurisdiction over the non-U.S. clearing

member or of which the non-U.S.

clearing member is a member or

participant.

OCC believes that these amendments

will enhance the effectiveness of its

financial surveillance program by

providing OCC with material

information, some of which it currently