SEC Approves Flexible Collateral Options for Bond Trade Clearing
Published Date: 12/18/2025
Notice
Summary
The Fixed Income Clearing Corporation (FICC) is rolling out a new way for members to use different types of collateral in their Sponsored GC Service and letting sponsors clear special “done-away” trades. This change helps members manage risks and trades more flexibly, starting soon after approval. It mainly affects financial firms using FICC’s clearing services and could make their trading smoother and more efficient.
Analyzed Economic Effects
8 provisions identified: 6 benefits, 2 costs, 0 mixed.
New Collateral‑in‑Lieu (CIL) Offering
FICC will add a Collateral‑in‑Lieu (CIL) option in its Sponsored GC Service where FICC takes a lien on the Purchased GC Repo Securities instead of collecting margin or certain Funds‑Only Settlement Amounts and instead of requiring the Sponsoring Member guaranty for those CIL trades. The change is intended to help registered investment companies (RICs) and other cash providers access FICC clearing and settlement.
Minimum 2% CIL Haircut Requirement
For Sponsored GC CIL Trades, FICC would require an Initial Haircut no less than 2 percent of the Start Leg Contract Value (or another amount determined by FICC). FICC will give Netting Members at least 30 business days' notice of changes to this CIL Required Haircut.
Clearing Fund Deposit Minimum for CIL Accounts
FICC may require a Sponsored GC CIL Omnibus Account to post a Required Fund Deposit equal to the greater of $1,000,000 and the sum of applicable charges (including a VaR differential and other margin components). The VaR component is calculated as the positive difference between the VaR that would apply if these trades were in a Sponsoring Member Omnibus Account and the aggregate CIL Required Haircuts.
No Funds‑Only Settlement Payments for CIL Lenders
FICC will not pay or collect Funds‑Only Settlement Amounts to or from a CIL Funds Lender in relation to a Sponsored GC CIL Trade, although it will continue to collect such amounts from a GC Funds Borrower when applicable. This change is intended to reduce the Funds‑Only payment obligations for CIL Funds Lenders and their sponsors.
Sponsors Not Guaranteeing CIL Lender Obligations
FICC's rules will provide that, for Sponsored GC CIL Trades, the Sponsoring Member does not guarantee the Sponsored Member's obligations arising under those CIL Trades, notwithstanding earlier Sponsoring Member Guaranty language. This change removes the guaranty obligation of Sponsoring Members for CIL Funds Lender trades.
Clearing of Done‑Away Sponsored GC Trades
FICC will allow Sponsoring Members to submit 'done‑away' Sponsored GC Trades for clearing, meaning a Sponsored Member may have its counterparty be any Netting Member or Indirect Participant rather than only its Sponsoring Member. This aims to let Sponsored Members clear more eligible secondary market trades without separate clearing agreements with each execution counterparty.
Settlement Deadline Extended to 7:00 p.m.
FICC will move certain Sponsored GC Trade deadlines — full settlement of the Start Leg, substitutions of Purchased GC Repo Securities, and satisfaction of GC Collateral Return Obligations and related cash payments — from 5:30 p.m. to 7:00 p.m. New York time to align with the Fedwire Funds Service close.
CIL Joint Account Agent and Allocation Rules
FICC will permit approved CIL Joint Account Agents to represent multiple CIL Funds Lenders in a CIL Joint Account Block; each CIL Funds Lender will be entitled to and liable for its allocated portion, and the agent must notify FICC of allocation information if a CIL Funds Lender defaults. FICC will seek to exercise remedies that do not significantly harm non‑defaulting CIL Funds Lenders where feasible.
Your PRIA Score
Personalized for You
How does this regulation affect your finances?
Sign up for a PRIA Policy Scan to see your personalized alignment score for this federal register document and every other regulation we track. We analyze your financial profile against policy provisions to show you exactly what matters to your wallet.
Key Dates
Department and Agencies
Related Federal Register Documents
2026-07651 — Concept Release on Consolidated Audit Trail and Other Audit Trails and Data Sources
The SEC wants your thoughts on how it tracks stock market trades using the Consolidated Audit Trail and other data tools. They’re thinking about updating rules to keep up with new tech, privacy, and security needs, and to make sure the system is fair and cost-effective. If you’re involved in the stock market or data tracking, speak up by June 22, 2026!
2026-10241 — Self-Regulatory Organizations; The Depository Trust Company; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the DTC Operational Arrangements (Necessary for Securities to Become and Remain Eligible for DTC Services)
The Depository Trust Company (DTC) is updating its rules to make it easier and clearer for agents handling corporate offers like tenders and subscriptions through its automated systems. This change affects companies and agents using DTC services to process these offers and starts right away with no extra costs. It’s all about smoother, faster, and more reliable processing for everyone involved!
2026-10244 — Self-Regulatory Organizations; Investors Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the Exchange's Fee Schedule Applicable to Members Concerning Equities Transaction Pricing
Investors Exchange (IEX) is updating its fee schedule starting June 1, 2026. Members who trade stocks will see changes in how they qualify for rebates and fee discounts based on their trading volume. These tweaks aim to make fees fairer and encourage more trading activity on the exchange.
2026-10245 — Self-Regulatory Organizations; BOX Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Rule 3120 To Increase the Position and Exercise Limits for Options on the iShares Bitcoin Trust ETF
BOX Exchange is raising the limits on how many options traders can hold and exercise for the iShares Bitcoin Trust ETF. This change lets bigger players trade more freely and takes effect immediately, matching similar moves by other exchanges. If you trade these options, get ready for bigger opportunities starting now!
2026-10129 — The Goldman Sachs Group, Inc.
Goldman Sachs is asking the SEC for special permission to create investment funds just for its employees, letting them skip some usual rules. This change mainly affects Goldman Sachs workers and could speed up how these funds work without changing important protections. If no one objects by June 12, 2026, the SEC will approve this request.
2026-10168 — Agency Information Collection Activities; Submission for OMB Review; Comment Request; Extension: Rule 17a-2
The SEC is asking to keep the rules that require underwriters to keep records about certain stock market activities for three years. About 647 companies spend around 3,235 hours and $530,000 yearly to follow these rules. This extension keeps things running smoothly without adding new costs or changes.
Previous / Next Documents
Previous: 2025-23283 — Constellation Energy Generation, LLC; Dresden Nuclear Power Station, Units 2 and 3; Subsequent License Renewal and Record of Decision
Constellation Energy just got the green light to keep running its Dresden Nuclear Power Station, Units 2 and 3, for even longer! The Nuclear Regulatory Commission renewed their licenses on December 16, 2025, meaning these reactors can keep producing power safely and reliably. This decision helps ensure steady energy and supports local jobs without any surprise costs right now.
Next: 2025-23286 — Agency Information Collection Activities; Submission to the Office of Management and Budget for Review and Approval; Comment Request; NESHAP for Secondary Aluminum Production (Renewal)
The EPA is asking to keep collecting info from secondary aluminum producers to make sure pollution rules are followed. This renewal won’t add new costs but keeps the paperwork going through the end of 2028. If you’re involved in aluminum recycling, now’s your chance to share your thoughts before January 20, 2026!