FICC Introduces Midday Charges for Safer Bond Clearing
Published Date: 9/25/2025
Notice
Summary
The Fixed Income Clearing Corporation (FICC) is adding a new intraday fee to better manage risks during the day for government securities trades. This change affects FICC members who trade U.S. government bonds and aims to keep the market safer by charging fees based on real-time price changes. The new rule kicks in soon and could impact how much members pay during busy trading hours.
Analyzed Economic Effects
4 provisions identified: 1 benefits, 3 costs, 0 mixed.
New Intraday Mark-to-Market Charge
FICC adopted an Intraday Mark-to-Market Charge that will be collected intraday from Members and Segregated Indirect Participants that trade U.S. government securities. An FICC impact study (July 1, 2022–June 30, 2024) estimated aggregate average daily charges would have been about $28.8 million, assessed to Members twice a day on average.
Three Thresholds That Trigger Charges
The Intraday Mark-to-Market Charge only applies if a Member breaches all three parameter breaks: (1) a Dollar Threshold initially set not less than $1,000,000; (2) a Percentage Threshold (not less than 10%, initially set at 30%); and (3) either a Trading Day Threshold (fewer than 100 trading days in a rolling 12-month period) or a Coverage Target (initially set at 100%). In volatile markets FICC may lower the Dollar Threshold (but not below $250,000), lower the Percentage Threshold (but not below 5%), or modify the Coverage Target.
One-Hour Payment Timing for Funds
The Proposed Rule Change includes a requirement (noted in the filing and commenter discussion) that a Segregated Indirect Participant, such as a registered fund, may need to pay an Intraday Mark-to-Market Charge within one hour of demand. The Commission acknowledges this one-hour payment requirement could present operational challenges for registered funds.
Waivers and Discretionary Reductions Allowed
FICC may waive or decrease the Intraday Mark-to-Market Charge in certain circumstances and will document and approve any waiver or reduction. One example given is when large mark-to-market fluctuations arise from trade errors that FICC can confirm have been reversed or corrected.
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