Front Matter

Front Matter Page

© 2010 International Monetary Fund

July 2010

IMF Country Report No. 10/250

United States: Publication of Financial Sector Assessment Program Documentation—Reports on Observance and Codes

This paper was prepared based on the information available at the time it was completed on July 12, 2010. The views expressed in this document are those of the staff team and do not necessarily reflect the views of the government of the United States or the Executive Board of the IMF.

The policy of publication of staff reports and other documents by the IMF allows for the deletion of market-sensitive information.

Copies of this report are available to the public from

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International Monetary Fund

Washington, D.C.

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FINANCIAL SECTOR ASSESSMENT PROGRAM

UNITED STATES OF AMERICA

BASEL CORE PRINCIPLES FOR EFFECTIVE BANKING SUPERVISION (BCP)

REPORT ON STANDARDS AND CODES (ROSC)

JULY 2010

International Monetary Fund

Monetary and Capital Markets Department

Contents

  • Glossary

  • I. Summary, Introduction and Methodology

  • II. Institutional and Market Structure—Overview

  • III. Preconditions for Effective Banking Supervision

  • IV. Main Findings

  • V. Authorities’ Response to the Assessment

  • Tables

  • 1. Summary of Compliance with the Basel Core Principles—ROSC

  • 2. Recommended Action Plan to Improve Compliance with the Basel Core Principles

Glossary

BCBS

Basel Committee on Banking Supervision

BCP

Basel Core Principles for Effective Banking Supervision

CAMELS

Capital adequacy, Asset quality, Management, Earnings, Liquidity, and Sensitivity to Market Risk

CHIPS

Clearing House Interbank Payments System

CP

Core Principle

CRE

Commercial Real Estate

DAR

Detailed Assessment Report

FASB

Financial Accounting Standards Board

FATF

Financial Action Task Force

FBA

Federal Banking Agencies

FDIC

Federal Deposit Insurance Corporation

FDI Act

Federal Deposit Insurance Act

FEDWIRE

The Federal Reserve Banks’ Fedwire Funds Services

FFIEC

Federal Financial Institutions Examination Council

FSSA

Financial System Stability Assessment

GSE

Government-Sponsored Enterprises

MTM

Mark to Market

OCC

Office of the Comptroller of Currency

OFAC

Office of Foreign Assets Control

OTC

Over-the-Counter

OTS

Office of the Thrift Supervision

PCA

Prompt Corrective Action

ROSC

Report on Standards and Codes

RTGS

Real Time Gross Settlement System

SCAP

Supervisory Capital Assessment Program

SLHCs

Savings and Loan Holding Companies

U.S. GAAP

U.S. Generally Accepted Accounting Principles

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FINANCIAL SECTOR ASSESSMENT PROGRAM

UNITED STATES OF AMERICA

The IOSCO Objectives and Principles of Securities Regulation

REPORT ON STANDARDS AND CODES (ROSC)

JULY 2010

International Monetary Fund

Monetary and Capital Markets Department

Contents

  • Glossary

  • I. Introduction and Methodology

  • II. Preconditions for Effective Banking Supervision

  • III. Main Findings

  • IV. Authorities’ Response to the Assessment

  • Tables

  • 1. Summary Implementation of the IOSCO Principles

  • 2. Recommended Action Plan to Improve Implementation of the IOSCO Principles

Glossary

ATSs

Alternative Trading Systems

BDs

Broker Dealers

BSA

Bank Secrecy Act

CEA

Commodity Exchange Act

CFMA

Commodity Futures Modernization Act of 2000

CFTC

Commodity Futures Trading Commission

CIS

Collective Investment Schemes

CPSS

Committee on Payment and Settlement Systems

CPOs

Commodity Pool Operators

DCM

Designated Contract Market

DOJ

Department of Justice

EBOTs

Exempt Boards of Trade

ECM

Exempt Commercial Market

FCM

Futures Commission Merchant

FINRA

Financial Industry Regulatory Authority

FSAP

Financial Sector Assessment Program

FSSA

Financial System Stability Assessment

GAAP

Generally Accepted Accounting Principles

GAAS

Generally Accepted Auditing Standards

IAs

Investment Advisers

IBs

Introducing Brokers

IG

Inspector General

IOSCO

International Organization of Securities Commissions

IOSCO MMOU

IOSCO Multilateral Memorandum of Understanding

MOU

Memorandum of Understanding

NFA

National Futures Association

NMS

National Market System

OCIE

Office of Compliance, Inspections, and Examinations (SEC)

OIG

Office of Inspector General

OTC

Over-the-Counter

PCAOB

Public Company Accounting Oversight Board

SEC

Securities and Exchange Commission

SROs

Self-regulatory Organizations

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FINANCIAL SECTOR ASSESSMENT PROGRAM

UNITED STATES OF AMERICA

IAIS Insurance Core Principles

REPORT ON STANDARDS AND CODES (ROSC)

JULY 2010

International Monetary Fund

Monetary and Capital Markets Department

Contents

  • Glossary

  • I. Introduction and Methodology

  • II. Institutional and Market Structure—Overview

  • IV. Main Findings

  • V. Authorities’ Response to the Assessment

  • Tables

  • 1. Summary of Observance of the Insurance Core Principles

  • 2. Recommended Action Plan to Improve Observance of the Insurance Core Principles

Glossary

AIG

American International Group

AML/CFT

Anti-Money Laundering

FATF

Financial Action Task Force

FAWG

Financial Analysis Working Group

FSAP

Financial Sector Assessment Program

IAIS

International Association of Insurance Supervisors

ICP

Insurance Core Principle

MoU

Memorandum of Understanding

NAIC

National Association of Insurance Commissioners

SEC

Securities and Exchange Commission

TARP

Troubled Asset Relief Program

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FINANCIAL SECTOR ASSESSMENT PROGRAM

UNITED STATES OF AMERICA

The Fixed Income Clearing Corporation–Government Securities Division Observance of the CPSS/IOSCO Recommendations for Central Counterparties

Report on Standards and Codes (ROSC)

July 2010

International Monetary Fund

Monetary and Capital Markets Department

Contents

  • Glossary

  • I. Introduction and Methodology

  • II. Institutional and Market Structure—Overview

  • III. Main Findings

  • IV. Authorities’ Response to the Assessment

  • Tables

  • 1. Key Statistics of FICC-GSD, 2007–09

  • 2. Summary of Observance with the CPSS-IOSCO Recommendations

  • 3. Actions to Improve Compliance

Glossary

CCP

Central Counterparty

CFTC

Commodity Futures Trading Commission

CME

Chicago Mercantile Exchange

CPSS

Committee on Payment and Settlement Systems

DTC

Depository Trust Company

DTCC

Depository Trust and Clearing Corporation

FICC-GSD

Fixed Income Clearing Corporation – Government Securities Division

FICC-MSBD

Fixed Income Clearing Corporation – Mortgage Backed Securities Division

FSS

Fedwire Securities Service

IMF

International Monetary Fund

IOSCO

International Organization of Securities Commission

NSCC

National Securities Clearing Corporation

RCCP

Recommendation for Central Counterparties

RSSS

Recommendation for Securities Settlement Systems

SEC

Securities and Exchange Commission

SSS

Securities Settlement System

Front Matter Page

FINANCIAL SECTOR ASSESSMENT PROGRAM

UNITED STATES OF AMERICA

The Depository Trust Company’s Observance of the CPSS-IOSCO Recommendations for Securities Settlement Systems

Report on Standards and Codes (ROSC)

July 2010

International Monetary Fund

Monetary and Capital Markets Department

Contents

  • Glossary

  • I. Introduction and Methodology

  • II. Institutional and Market Structure—Overview

  • III. Main Findings

  • IV. Authorities’ Response to the Assessment

  • Tables

  • 1. Key Statistics of FICC-GSD, 2007–09

  • 2. Summary of Observance with the CPSS-IOSCO Recommendations

  • 3. Actions to Improve Compliance

Glossary

CCP

Central Counterparty

CPSS

Committee on Payment and Settlement Systems

CSD

Central Securities Depository

DTC

Depository Trust Company

DTCC

Depository Trust and Clearing Corporation

DVP

Delivery-versus-Payment

FOP

Free of Payment

FSS

Fedwire Securities Service

IMF

International Monetary Fund

IOSCO

International Organization of Securities Commission

ISO

International Organisation for Standardisation

NSCC

National Securities Clearing Corporation

NSS

National Settlement Service

NYSBD

New York State Banking Department

NYSE

New York Stock Exchange

RCCP

Recommendation for Central Counterparties

RSSS

Recommendation for Securities Settlement Systems

SEC

Securities and Exchange Commission

SWIFT

Society for Worldwide Interbank Financial Telecommunication

Front Matter Page

FINANCIAL SECTOR ASSESSMENT PROGRAM

UNITED STATES OF AMERICA

The National Securities Clearing Corporation Observance of the CPSS/IOSCO Recommendations for Central Counterparties

Report on Standards and Codes (ROSC)

July 2010

International Monetary Fund

Monetary and Capital Markets Department

Contents

  • Glossary

  • I. Introduction and Methodology

  • II. Institutional and Market Structure—Overview

  • III. Main Findings

  • IV. Authorities’ Response to the Assessment

  • Tables

  • 1. Key Statistics of FICC, 2007–09

  • 2. Summary of Detailed Assessment of Observance with the CPSS-IOSCO Recommendations

  • 3. Actions to Improve Compliance

Glossary

BCP

Business Continuity Plan

BITS

Banking, Infrastructure and Technology Services

CCP

Central Counterparty

CPSS

Committee on Payment and Settlement Systems

DTC

Depository Trust Company

DTCC

Depository Trust and Clearing Corporation

DVP

Delivery-versus-Payment

FDIA

Federal Deposit Insurance Act

FDICIA

Federal Deposit Insurance Corporation Improvement Act

FDIC

Federal Deposit Insurance Corporation

FICC-GSD

Fixed Income Clearing Corporation – Government Securities Division

FICC-MSBD

Fixed Income Clearing Corporation – Mortgage Backed Securities Division

FR

Federal Reserve

FRA

Federal Reserve Act

IMF

International Monetary Fund

IOSCO

International Organization of Securities Commission

ISO

International Organisation for Standardisation

JPMC

JP Morgan Chase

NSCC

National Securities Clearing Corporation

NSS

National Settlement Service

RCCP

Recommendation for Central Counterparties

RSSS

Recommendation for Securities Settlement Systems

SEC

Securities and Exchange Commission

SIFMA

Securities Industry and Financial Markets Association

TRADES

Treasury/Reserve Automated Debt Entry System

UCC

Uniform Commercial Code

Front Matter Page

FINANCIAL SECTOR ASSESSMENT PROGRAM

UNITED STATES OF AMERICA

The Fedwire Securities Service’s Observance’s of the CPSS-IOSCO Recommendations for Securities Settlement Systems

Report on Standards and Codes (ROSC)

July 2010

International Monetary Fund

Monetary and Capital Markets Department

Contents

  • Glossary

  • I. Introduction and Methodology

  • II. Institutional and Market Structure—Overview

  • III. Main Findings

  • IV. Authorities’ Response to the Assessment

  • Tables

  • 1. Key Statistics of FSS, 2007–09

  • 2. Summary of Observance with the CPSS-IOSCO Recommendationss

  • 3. Recommended Action plan to Improve Observance of CPSS-IOSCO Recommendations

Glossary

CCP

Central Counterparty

CPSS

Committee on Payment and Settlement Systems

CSD

Central Securities Depository

DTC

Depository Trust Company

DTCC

Depository Trust and Clearing Corporation

DVP

Delivery-versus-Payment

FSS

Fedwire Securities Service

FICC

Fixed Income Clearing Corporation

FICC-GSD

Fixed Income Clearing Corporation – Government Securities Division

FICC-MSBD

Fixed Income Clearing Corporation – Mortgage Backed Securities Division

GSE

Government Sponsored Entity

IMF

International Monetary Fund

IOSCO

International Organization of Securities Commission

ISO

International Organization for Standardization

NSCC

National Securities Clearing Corporation

PSPAC

Payment System Policy Advisory Committee

RCCP

Recommendation for Central Counterparties

RSSS

Recommendation for Securities Settlement Systems

SEC

Securities and Exchange Commission

SWIFT

Society for Worldwide Interbank Financial Telecommunication

SWIFT

Society for Worldwide Interbank Financial Telecommunication

WPO

Wholesale Product Office