Trump to Nominate CFTC Acting Head Giancarlo as Permanent Chairman

President Trump announced Tuesday, March 14th that J. Christopher Giancarlo would be his selection to oversee the Commodity Futures Trading Commission (CFTC), according to a New York Times article.

In appointing Mr. Giancarlo, President Trump gets a regulator that has embraced the broad goals of new derivatives regulations under the Dodd-Frank Act, while also criticizing crucial portions of the fine print. Mr. Giancarlo recently said, "I publically support the core reforms" of Dodd-Frank, but also stressed that he "believed in the power of markets to be somewhat self-correcting."

Giancarlo's appointment, which requires Senate approval, follows President Trump's signing of an executive order in February that takes aim at Dodd-Frank. While the President can't unwind Dodd-Frank with a stroke of a pen, Mr. Giancarlo can move to ease some of its rules. With the nomination of Mr. Giancarlo, President Trump has now established his core group of financial policy makers that hope to overhaul the Obama Administration’s financial regulations.

As reported by Morning Consult, Mr. Giancarlo laid out a policy agenda on March 15th that calls for revising "flawed" swaps rules and having the CFTC play a more influential role on the Financial Stability Oversight Council. The CFTC "must allow market participants to choose the manner of trade execution best suited to their swaps trading and liquidity needs and not have it chosen for them by the federal government," Mr. Giancarlo said in prepared remarks at the International Futures Industry conference in Boca Raton, Florida.

SFIG has been engaged with CFTC staff on the swaps margin rule. The latest no-action position issued by the CFTC on February 13, 2017 followed an SFIG meeting at which we discussed members' request for temporary relief for legacy securitization transactions from variation margin requirements. If you would like to join SFIG's Derivatives in Securitization Task Force, please contact Alyssa.Acevedo@sfindustry.org.

For a broader look at the landscape of major decision makers, who are likely to have an impact on the structured finance market in 2017, check out SFIG's Key Policymaker Tracker here.

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