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DSIO issues time-limited, conditional no-action relief excluding certain loan-related swaps from swap dealer registration de minimis threshold

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The Commodity Futures Trading Commission’s (CFTC) Division of Swap Dealer and Intermediary Oversight (DSIO) has issued conditional, time-limited no-action relief to a banking entity for not counting certain loan-related swaps towards its swap dealer de minimis threshold (under paragraph (4) of the “swap dealer” definition in Regulation 1.3).

The no-action relief provides that DSIO will not recommend that the CFTC take an enforcement action against the banking entity (including any of its insured depository institution subsidiaries, together with their affiliates) for not counting towards its de minimis threshold certain swaps entered into from the date of the no-action relief through 31 December 2018. 
For the relief to apply, the swaps must meet the conditions in the letter. The conditions limit the scope of relief while ensuring that the banking entity may continue to serve the immediate hedging needs of its existing loan clients, comprised of small and medium-sized commercial entities.  

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