WASHINGTON — Five federal agencies on Monday issued a proposal that would harmonize a 2015 rule establishing swap margin requirements with a later policy that imposes restrictions on certain qualified financial contracts.

The proposal — released by the Federal Reserve Board, Office of the Comptroller of the Currency, Federal Deposit Insurance Corp., Farm Credit Administration and Federal Housing Finance Agency — would exempt certain legacy swaps from the 2015 margin rules if those swaps have changed in order to comply with QFC rules, which were finalized in 2017.

Federal Reserve building.
The Federal Reserve Board was among five agencies issuing a proposal Monday to harmonize swaps rules. Bloomberg News

The agencies are also proposing to harmonize the definitions for “master netting agreements” between the two rules. In swap arrangements, netting is generally meant to simplify the amount two parties pay and receive in a deal. The plan would also ensure that netting agreements covered by the swap margin rules do not fall outside the definition of “Eligible Master Netting Agreement” based only on their complying with the QFC rules.

The comment period for the new proposal will be open for 60 days.

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