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."
The week on Risk.net, July 7-13, 2018Receive this by email