SEC Approves CME Clearing's Rule Amendments to CLF Procedures
CME Securities Clearing's proposed changes to Rule 410, Rule 101 and liquidity policies are approved, binding all clearing members.
On October 13, 2026 the Securities and Exchange Commission issued Order No. 34-106657 approving CME Securities Clearing Inc.'s proposed rule change CMESC-2026-008 (File No. SR-CMESC-2026-008). The filing was made on August 21, 2026 and the notice of proposed rule change was published in the Federal Register on September 3, 2026 (FR Doc No. 2026-21136, pages 65821-65827). No comments were received during the comment period.
The amendment makes the Capped Liquidity Facility (CLF) Master Repurchase Agreement (MRA) rules-based. Under the revised Rule 410 each member is automatically a party to the CLF MRA by operation of the rule, eliminating the need for separate execution. The CLF MRA now incorporates by reference the SIFMA Master Repurchase Agreement (September 1996 version) and adds new paragraphs (a) through (g) that address definitions, events of default, conflict resolution and other terms specific to CLF transactions.
Rule 410(i) - to be renumbered as Rule 410(e) - is amended to clarify that CMESC will conduct a liquidity assessment at least quarterly, or more frequently as deemed appropriate, to determine the required size of the CLF and each member's Allocated CLF Amount. The amendment also specifies that the assessment will calculate the Stress Potential Payment Obligation (SPPO) for each Participant Family using a look-back period and will use the largest SPPO (the "Cover 1 SPPO") as the starting point for sizing the CLF. CMESC states that the methodology and formulae remain unchanged.
Related amendments to Rule 101, the CLF Procedure and the Liquidity Risk Management Policy align the operational language with the new rules-based MRA and the clarified assessment process. The Commission notes that the changes are intended to reduce administrative burdens and promote consistency across the clearing agency and its members.
The order binds CMESC, a covered clearing agency under Section 17A of the Securities Exchange Act of 1934, and all of its members. Compliance with the amended Rule 410, Rule 101, the CLF Procedure and the Liquidity Risk Management Policy is required as of the effective date of the order.
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