Receipt and Review of Financial Data
MBSD Clearing Members are required to submit member-certified financial statements on a monthly or quarterly basis, depending on the organization type, to FICC. Each member’s financial condition is monitored for parameter breaks, with certain key financial data and ratios recorded and analyzed, including compliance with financial standards. The parameters that are monitored are losses over one- and three-month horizons, leverage and capital or excess net capital declines over one-month and three-month horizons and failure to meet minimum regulatory capital requirements. If a parameter break occurs, FICC’s risk department staff will contact the member to discuss the causes of the parameter break and the member’s plans to improve its financial or operating performance back to satisfactory levels. In addition, full credit review of members is performed at least annually, with more frequent reviews occurring for certain members.