House Commodities Bill Includes ABA-Backed Provisions

The House yesterday voted 239-182 to pass the Commodity End-User Relief Act that would reauthorize the Commodity Futures Trading Commission. The bill includes multiple American Bankers Association-supported provisions.

For example, the bill would prevent the de minimis threshold for swap dealer registration from falling below $8 billion unless the CFTC affirmatively changes it by rule or regulation — which ABA supports as a necessary clarification to provide certainty for banks that pose no systemic risk to the financial system. In addition, it would codify a CFTC no-action policy that exempts from clearing swaps executed by a bank holding company with less than $10 billion in consolidated assets.

Other aspects of the legislation would remove language requiring the CFTC to set position limits on energy, agriculture and metal derivatives to prevent “excessive” speculation and would provide regulatory relief for risk management trades entered into between affiliates. The bill would also require more stringent cost-benefit analysis by the CFTC before rules are adopted. For more information, contact ABA’s Jason Shafer or Shaun Kern.