I 

115TH CONGRESS 

1ST SESSION H. R. 4659 

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 

A BILL 

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

cleared derivatives. 

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: 


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

2 appropriate’’; and 

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

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

5 purposes of any leverage-based capital rule, guide6 line, standard, or requirement promulgated, pre7 scribed, or imposed by any appropriate Federal 

8 banking agency on insured depository institutions, 

9 the amount of any initial margin provided by a cli10 ent of an insured depository institution with respect 

11 to a centrally-cleared derivative obligation shall be 

12 deducted from the amount of any leverage exposure 

13 arising from the insured depository institution’s 

14 guarantee of the client’s derivative obligation to the 

15 central counterparty.’’. 

16 (b) TREATMENT OF CLIENT MARGIN FOR BANK

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

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

19 amended— 

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

21 ‘‘(D) TREATMENT OF CLIENT MARGIN.— 

22 For purposes of any leverage-based capital rule, 

23 guideline, standard, or requirement promul24 gated, prescribed, or imposed by the Board on 

25 bank holding companies, the amount of any iniVerDate Sep 11 2014 23:26 Dec 15, 2017 Jkt 079200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H4659.IH H4659

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1 tial margin provided by a client of a bank hold2 ing company or affiliate thereof with respect to 

3 a centrally-cleared derivative obligation shall be 

4 deducted from the amount of any leverage expo5 sure arising from the guarantee by the bank 

6 holding company or affiliate thereof of the cli7 ent’s derivative obligation to the central 

8 counterparty.’’. 

9 (c) TREATMENT OF CLIENT MARGIN FOR SAVINGS

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

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

12 amended— 

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

14 following: 

15 ‘‘(A) REGULATIONS AND ORDERS.—The 

16 Board’’; and 

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

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

19 purposes of any leverage-based capital rule, guide20 line, standard, or requirement promulgated, pre21 scribed, or imposed by the Board on savings and 

22 loan holding companies, the amount of any initial 

23 margin provided by a client of a savings and loan 

24 holding company or affiliate thereof with respect to 

25 a centrally-cleared derivative obligation shall be deVerDate Sep 11 2014 23:26 Dec 15, 2017 Jkt 079200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H4659.IH H4659

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1 ducted from the amount of any leverage exposure 

2 arising from the guarantee by the savings and loan 

3 holding company or affiliate thereof of the client’s 

4 derivative obligation to the central counterparty.’’. 

5 (d) AMENDMENTS TO LEVERAGE-BASED CAPITAL

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

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

8 the Federal Deposit Insurance Corporation, the Board of 

9 Governors of the Federal Reserve System, and the Comp10 troller of the Currency shall amend their rules to imple11 ment the amendments made by this Act. 

Æ 


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