2025-14662Notice

OCC Beefs Up Stress Tests to Weather Market Storms

Published Date: 8/4/2025

Notice

Summary

The Options Clearing Corporation (OCC) is updating how it tests for financial risks to better protect itself and its members. These changes improve stress tests and fund rules to handle tough market situations more smoothly. The updates start soon and help keep the financial system safer without extra costs for members.

Analyzed Economic Effects

2 provisions identified: 0 benefits, 2 costs, 0 mixed.

New Stress Scenarios May Trigger Collateral Calls

OCC will promote six Informational Scenarios into its Sufficiency Scenarios and demote eight current Sufficiency Scenarios into Informational Scenarios. Four of the promoted scenarios are sector-specific and two represent extreme 2020 market moves; the promoted Sufficiency Scenarios may be used to determine whether OCC needs to call for additional margin intra-day or to increase the size of the Clearing Fund intra-month.

Clearing Fund Can Be Sized More Conservatively

OCC currently sizes its Clearing Fund to cover a 1-in-80 year hypothetical event and the Stress Testing Working Group (STWG) may recommend using a 1-in-90 year event. OCC clarified that, subject to STWG, Management Committee, and Risk Committee approval, it can size the Clearing Fund to a standard that exceeds a 1-in-80 year event.

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Key Dates

Published Date
8/4/2025

Department and Agencies

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Securities and Exchange Commission
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