IIB 

115TH CONGRESS 

2D SESSION H. R. 5749 

IN THE SENATE OF THE UNITED STATES 

JULY 11, 2018 

Received; read twice and referred to the Committee on Banking, Housing, and 

Urban Affairs 

AN ACT 

To require the appropriate Federal banking agencies to increase the risk-sensitivity of the capital treatment of 

certain centrally cleared exchange-listed options and derivatives, and for other purposes. 

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


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HR 5749 RFS

1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as the ‘‘Options Markets Sta3 bility Act’’. 

4 SEC. 2. RULEMAKING. 

5 Within 180 days of the date of enactment of this Act, 

6 the Board of Governors of the Federal Reserve System, 

7 the Federal Deposit Insurance Corporation, and the 

8 Comptroller of the Currency shall, jointly, issue a pro9 posed rule, and finalize such rule within 360 days of the 

10 date of enactment of this Act, to adopt a methodology for 

11 calculating the counterparty credit risk exposure, at de12 fault, of a depository institution, depository institution 

13 holding company, or affiliate thereof to a client arising 

14 from a guarantee provided by the depository institution, 

15 depository institution holding company, or affiliate thereof 

16 to a central counterparty in respect of the client’s per17 formance under an exchange-listed derivative contract 

18 cleared through that central counterparty pursuant to the 

19 risk-based and leverage-based capital rules applicable to 

20 depository institutions and depository institution holding 

21 companies under parts 3, 217, and 324 of title 12, Code 

22 of Federal Regulations. In issuing such rule, the Board 

23 of Governors of the Federal Reserve System, the Federal 

24 Deposit Insurance Corporation, and the Comptroller of 

25 the Currency shall consider— 


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HR 5749 RFS

1 (1) the availability of liquidity provided by mar2 ket makers during times of high volatility in the cap3 ital markets; 

4 (2) the spread between the bid and the quote 

5 offered by market makers; 

6 (3) the preference for clearing through central 

7 counterparties; 

8 (4) the safety and soundness of the financial 

9 system and financial stability, including the benefits 

10 of central clearing; 

11 (5) the safety and soundness of individual insti12 tutions that may centrally clear exchange-listed de13 rivatives or options on behalf of a client, including 

14 concentration of market share; 

15 (6) the economic value of delta weighting a 

16 counterparty’s position and netting of a counter17 party’s position; 

18 (7) the inherent risk of the positions; 

19 (8) barriers to entry for depository institutions, 

20 depository institution holding companies, affiliates 

21 thereof, and entities not affiliated with a depository 

22 institution or depository institution holding company 

23 to centrally clear exchange-listed derivatives or op24 tions on behalf of market makers; 


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1 (9) the impact any changes may have on the 

2 broader capital regime and aggregate capital in the 

3 system; and 

4 (10) consideration of other potential factors 

5 that impact market making in the exchange-listed 

6 options market, including changes in market struc7 ture. 

8 SEC. 3. REPORT TO CONGRESS. 

9 At the end of the 5-year period beginning on the date 

10 the final rule is issued under section 2, the Board of Gov11 ernors of the Federal Reserve System shall submit to the 

12 Committee on Financial Services of the House of Rep13 resentatives and the Committee on Banking, Housing, and 

14 Urban Affairs of the Senate a report detailing the impact 

15 of the final rule during such period on the factors de16 scribed under paragraphs (1) through (10) of section 2. 

Passed the House of Representatives July 10, 2018. 

Attest: KAREN L. HAAS, 

Clerk. 


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