By Davide Barbuscia and Douglas Gillison
NEW YORK (Reuters) – Wall Street’s top regulator hit the brakes on a key reform on Tuesday, delaying by a year the rollout of new rules designed to curb systemic risk in the $28.5 trillion U.S. Treasury market by channeling more trades through clearing houses.
The U.S. Securities and Exchange Commission said in a statement late on Tuesday it had extended by 12 months compliance dates for the clearing of eligible cash transactions and repo transactions.
The rules, which require some cash Treasury and repurchase or “repo” agreements to be centrally cleared, were originally supposed to be implemented in phases by June 2026, but several Wall Street trade associations last month asked the SEC to extend the process by at least one year for the cash and repo clearing deadlines.
“The U.S. Treasury market is a critical piece of the global financial system. New rules must be implemented properly, and any operational issues must be addressed,” said SEC Acting Chairman Mark Uyeda. “This one-year extension provides additional time to implement and validate operational changes,” he said in a statement.
Uyeda is leading the SEC alongside fellow Republican Hester Peirce and Democrat Caroline Crenshaw. They all voted in favor of the postponement. U.S. President Donald Trump’s nominee to lead the agency Paul Atkins has yet to be confirmed.
The Securities Industry and Financial Markets Association (SIFMA) said on Tuesday the delayed implementation was important to avoid market disruptions.
“Market participants have become increasingly concerned that the original implementation dates were overly aggressive and would add unnecessary risk to the nation’s and world’s most important asset market,” it said in a statement.
The rule originally said clearing houses would have until March 2025 to comply with provisions on risk management, protection of customer assets and access to clearance and settlement services. Their members had until December 2025 to begin central clearing of cash market Treasury transactions and until June 30, 2026, for repo transactions. The repo market is where banks and funds exchange short-term loans backed by Treasuries.
The SEC kept the March 2025 deadline for clearing agencies to implement required access and risk management changes as prescribed by the SEC clearing rule, but it extended to September 30 this year the deadline for clearing houses to enforce those requirements for clearing members. (This story has been corrected to change the deadline to September 2025, not March 2026, in paragraph 9)
(Reporting by Davide Barbuscia and Douglas Gillison; Editing by Chris Reese and Christopher Cushing)
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