Feb. 11, 2023
February 11, 2023 Hello SEC members, I am against this proposed rule change (SR-OCC-2022-012). Not only does this proposition bring more risk to the OCC by allowing laxed credit rating thresholds for foreign clearing banks, they further compound the risk by eliminating the credit rating threshold entirely for foreign bank obligations. These seem like highly unnecessary actions to take during a stable economic period and appear solely as if the OCC is attempting to court more foreign investment without concern for the foreign banks ability to repay. The proposal is further concerning in that the OCC wants to eliminate using the STANS methodology, which has been in use for almost 2 decades, for an unproven adjustable collateral haircut approach that conveniently avoids including the 2008 market crash into its dataset despite claiming that it would consider stressed market conditions. Why dismiss one of the most stressed market conditions in your dataset for a tool to assess stressed market conditions? By only doing a 10 year look-back period, the tool will only have access to long-standing bull market conditions with a minor anomaly in early 2020 that will be drowned out by the surrounding data. This would give predictions skewed toward bullish sentiment and would be the antithesis of conservative safety regulation. It is therefore that I ask that you reject this proposal. Thank you, - Jeremy