Feb. 2, 2024
I trust this letter finds you well. I am writing to express my significant concerns and objections regarding the proposed rule change by the Options Clearing Corporation (OCC) concerning adjustments to parameters for calculating margin requirements during periods of high market volatility, identified as SR-OCC-2024-001 34-99393. While I understand the necessity for regulatory adjustments to accommodate changing market conditions, I believe it is crucial to thoroughly evaluate the potential consequences of such changes, particularly in the context of market stability, transparency, and potential conflicts of interest. Impact on Market Stability: The proposed rule change raises concerns about its potential impact on market stability. Margin requirements serve as a critical safeguard against excessive risk-taking by financial institutions. The adjustment of these parameters during periods of high market volatility could potentially expose the market to increased risks, compromising its stability and the well-being of market participants. Lack of Transparency: The lack of transparency in certain redacted materials associated with this proposed rule change is deeply troubling. Transparent and accessible information is paramount in fostering trust within the financial industry. Redacted materials impede stakeholders' ability to make informed decisions and understand the full scope of the proposed changes. I strongly urge the regulatory body to ensure complete transparency in all materials related to this rule change. Conflict of Interest with FRM Officer's Role: The role of the Financial Risk Management (FRM) Officer in this process raises concerns about potential conflicts of interest. As a key player in risk management, their impartiality is critical to the integrity of risk assessment processes. The regulatory body must thoroughly assess and address any potential conflicts to uphold the highest standards of governance. In light of these concerns, I respectfully urge SEC to reconsider and thoroughly evaluate the proposed rule change. The overarching principles of transparency, risk mitigation, and the broader market's well-being should guide the decision-making process. I appreciate your attention to this matter and the regulatory body's commitment to maintaining the integrity of financial markets. I am confident that a comprehensive reassessment of the proposed rule change will contribute to a more resilient and transparent financial system. Thank you for your time and consideration.