📈SEC's Daily Computation Rule Changes for Broker-Dealers
Daily Computation of Customer and Broker-Dealer Reserve Requirements Under the Broker-Dealer Customer Protection Rule
Summary
The Securities and Exchange Commission ("Commission") is adopting amendments to the broker-dealer customer protection rule to require certain broker-dealers to perform their reserve computations for accounts of customers and proprietary accounts of broker-dealers and make any required deposits into their reserve bank accounts daily rather than weekly. The Commission also is adopting amendments to the broker-dealer net capital rule and customer protection rule to permit certain broker-dealers that perform a daily reserve computation for accounts of customers to reduce aggregate debit items (i.e., customer- related receivables) by 2% rather than 3% as part of the computation. Finally, the Commission is adopting technical amendments to the Financial and Operational Combined Uniform Single Report ("FOCUS Report") to conform it to the amendments with respect to the lowering of the debit reduction from 3% to 2%.
Agencies
- Securities and Exchange Commission
Business Impact
$$ - Med
The amendments to the broker-dealer customer protection rule require certain broker-dealers to perform daily reserve computations, which imposes compliance and operational costs. This change affects risk management for broker-dealers and their ability to safeguard customer assets, thereby influencing business strategies and liquidity management.