IB 

Union Calendar No. 680 

115TH CONGRESS 

2D SESSION H. R. 4659 

[Report No. 115–882] 

To require the appropriate Federal banking agencies to recognize the 

exposure-reducing nature of client margin for cleared derivatives. 

IN THE HOUSE OF REPRESENTATIVES 

DECEMBER 14, 2017 

Mr. LUETKEMEYER (for himself, Mr. LUCAS, Mr. VELA, Mr. O’HALLERAN, 

and Mr. DAVID SCOTT of Georgia) introduced the following bill; which 

was referred to the Committee on Financial Services 

AUGUST 3, 2018 

Additional sponsors: Mr. SESSIONS, Mr. HULTGREN, Mr. EMMER, Mr. RODNEY DAVIS of Illinois, Mr. CONAWAY, Mr. PETERSON, Mr. ARRINGTON, 

Mr. GONZALEZ of Texas, Mr. KUSTOFF of Tennessee, Mr. AUSTIN SCOTT

of Georgia, Mr. HILL, Mr. MESSER, and Mr. GOTTHEIMER

AUGUST 3, 2018 

Committed to the Committee of the Whole House on the State of the Union 

and ordered to be printed 


daltland on DSKBBV9HB2PROD with BILLS
2 

•HR 4659 RH

A BILL 

To require the appropriate Federal banking agencies to recognize the exposure-reducing nature of client margin for 

cleared derivatives. 


daltland on DSKBBV9HB2PROD with BILLS
3 

•HR 4659 RH

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. TREATMENT OF CLIENT MARGIN. 

4 (a) TREATMENT OF CLIENT MARGIN FOR INSURED

5 DEPOSITORY INSTITUTIONS.—Section 18(n) of the Fed6 eral Deposit Insurance Act (12 U.S.C. 1828(n)) is amend7 ed— 

8 (1) by striking ‘‘No appropriate’’ and inserting 

9 the following: 

10 ‘‘(1) UNIDENTIFIED INTANGIBLE ASSETS.—No 

11 appropriate’’; and 

12 (2) by adding at the end the following: 

13 ‘‘(2) TREATMENT OF CLIENT MARGIN.—For 

14 purposes of any leverage-based capital rule, guide15 line, standard, or requirement promulgated, pre16 scribed, or imposed by any appropriate Federal 

17 banking agency on insured depository institutions, 

18 the amount of any initial margin provided by a cli19 ent of an insured depository institution with respect 

20 to a centrally-cleared derivative obligation shall be 

21 deducted from the amount of any leverage exposure 

22 arising from the insured depository institution’s 

23 guarantee of the client’s derivative obligation to the 

24 central counterparty.’’. 


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•HR 4659 RH

1 (b) TREATMENT OF CLIENT MARGIN FOR BANK

2 HOLDING COMPANIES.—Section 5(c)(3) of the Bank 

3 Holding Company Act of 1956 (12 U.S.C. 1844(c)(3)) is 

4 amended— 

5 (1) by adding at the end the following: 

6 ‘‘(D) TREATMENT OF CLIENT MARGIN.— 

7 For purposes of any leverage-based capital rule, 

8 guideline, standard, or requirement promul9 gated, prescribed, or imposed by the Board on 

10 bank holding companies, the amount of any ini11 tial margin provided by a client of a bank hold12 ing company or affiliate thereof with respect to 

13 a centrally-cleared derivative obligation shall be 

14 deducted from the amount of any leverage expo15 sure arising from the guarantee by the bank 

16 holding company or affiliate thereof of the cli17 ent’s derivative obligation to the central 

18 counterparty.’’. 

19 (c) TREATMENT OF CLIENT MARGIN FOR SAVINGS

20 AND LOAN HOLDING COMPANIES.—Section 10(g)(1) of 

21 the Home Owners’ Loan Act (12 U.S.C. 1467a(g)(1)) is 

22 amended— 

23 (1) by striking ‘‘The Board’’ and inserting the 

24 following: 


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•HR 4659 RH

1 ‘‘(A) REGULATIONS AND ORDERS.—The 

2 Board’’; and 

3 (2) by adding at the end the following: 

4 ‘‘(B) TREATMENT OF CLIENT MARGIN.—For 

5 purposes of any leverage-based capital rule, guide6 line, standard, or requirement promulgated, pre7 scribed, or imposed by the Board on savings and 

8 loan holding companies, the amount of any initial 

9 margin provided by a client of a savings and loan 

10 holding company or affiliate thereof with respect to 

11 a centrally-cleared derivative obligation shall be de12 ducted from the amount of any leverage exposure 

13 arising from the guarantee by the savings and loan 

14 holding company or affiliate thereof of the client’s 

15 derivative obligation to the central counterparty.’’. 

16 (d) AMENDMENTS TO LEVERAGE-BASED CAPITAL

17 REGULATIONS.—Not later than the end of the 3-month 

18 period beginning on the date of the enactment of this Act, 

19 the Federal Deposit Insurance Corporation, the Board of 

20 Governors of the Federal Reserve System, and the Comp21 troller of the Currency shall amend their rules to imple22 ment the amendments made by this Act. 


daltland on DSKBBV9HB2PROD with BILLS
Union Calendar No. 680 

115TH CONGRESS 

2D SESSION H. R. 4659 

[Report No. 115–882] 

A BILL 

To require the appropriate Federal banking agenclient margin for cleared derivatives. cies to recognize the exposure-reducing nature of 

AUGUST 3, 2018 

Committed to the Committee of the Whole House on the 

State of the Union and ordered to be printed 


daltland on DSKBBV9HB2PROD with BILLS