SEC Approves LCH SA Rule Requiring Minimum Cash Collateral from Clearing Members

The Securities and Exchange Commission approved LCH SA's proposed rule change on September 24, 2026. The order amends the CDS Clearing Rule Book, CDS Clearing Procedures, and LCH Liquidity Risk Policy to require clearing members to maintain a minimum cash collateral amount.

Article 4.2.6.4 of the Rule Book, which previously allowed LCH SA to apply haircuts and foreign-exchange adjustments to collateral, is revised to reference Section 3 of the Procedures for all collateral valuation. This consolidates the authority to adjust collateral values in a single location.

Section 3.2 of the Procedures is amended to create a Minimum Cash Collateral Requirement. The requirement sets a floor, expressed as a percentage of a member's margin requirement, that must be met in cash for each currency. LCH SA will calculate the minimum cash amount at the end of each day and will block cash withdrawals that would cause a breach. Any change to the minimum cash requirement may be implemented only after a 15 calendar days consultation with clearing members.

The rule change also removes outdated transaction timelines from Sections 3.8(h) and 3.8(i), directing members to the centralized "Request Timelines" posted on LCH SA's website. It replaces form-based requests for U.S. dollar cash collateral returns with electronic submissions through LCH SA's Collateral Management System.

The proposed rule change was published for comment on August 13, 2026, following the filing on July 31, 2026. No comments were received, and the Commission found the amendments consistent with the Act and applicable regulations.