NYSE calls for looser rules on derivatives trading

Speaking to the Senate's banking subcommittee, Bennett said capital requirements for broker-dealers made business in the US 'less attractive' and were driving brokers to move their derivatives businesses overseas.

SEC requirements to maintain a minimum of $5 billion tentative net capital, and to submit to SEC supervision, are limiting the ability of brokers to calculate their own net capital - a significant regulatory handicap, Bennett said.

He called for the SEC to lower the minimum capital requirement and to move from strategy-based to portfolio-based calculation of margins, to attract more over-the-counter derivatives customers back to US broker-dealers.

NYSE does not have a derivatives market, but Bennett hinted it might develop one. He told the committee: "Investors will increasingly need platforms that can meet all their investment needs, including equities, futures, options or swaps. As the NYSE proceeds with its plans to become a publicly traded company and merge with Archipelago, we are looking to take advantage of the opportunities this new competitive landscape will present."

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