Tuesday, December 22, 2009

Task Force on Tri‐Party Repo Infrastructure Payments Risk Committee

The Task Force on Tri‐Party Repo Infrastructure (“Task Force”) was formed in September 2009 under the auspices of the Payments Risk Committee (“PRC”), a private sector body sponsored by the Federal Reserve Bank of New York.

The Task Force’s objective is to develop a set of recommendations for improving and mitigating risks related to triparty repo transactions, given the important role such transactions play in supporting the liquidity and efficiency of U.S. securities markets and in the implementation of monetary policy. The primary areas of focus for this effort are clearance and settlement arrangements, credit and liquidity risk management practices and tools, and arrangements for facilitating the orderly disposition of collateral in stress scenarios.

This report summarizes the progress of the Task Force as of mid December, 2009. In the interest of transparency, this progress report is being made public [website]. The Task Force intends to continue developing its recommendations and will also sponsor a broader forum in early 2010 to reach out to representatives of firms not represented directly on the Task Force and provide a basis for wider industry discussion.

The Task Force expects to complete its work during the first quarter of 2010. The Federal Reserve has indicated that it plans to incorporate the Task Force’s report and recommendations into a white paper that it will issue for public comment to enable all interested stakeholders to review and comment on the work.

The full report can be downloaded here.

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