Self-Regulatory Organizations; Fixed Income Clearing Corporation; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Make Amendments to the GSD Rules and the MBSD Rules To Modify Certain Fees

<NOTICE> SECURITIES AND EXCHANGE COMMISSION <DEPDOC>[Release No. 34-104397; File No. SR-FICC-2025-024]</DEPDOC> <SUBJECT>Self-Regulatory Organizations; Fixed Income Clearing Corporation; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Make Amendments to the GSD Rules and the MBSD Rules To Modify Certain Fees</SUBJECT> <DATE>December 15, 2025.</DATE> Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)  <SU>1</SU> <FTREF/> and Rule 19b-4 thereunder, <SU>2</SU> <FTREF/> notice is hereby given that on December 8, 2025, Fixed Income Clearing Corporation (“FICC”) filed with the Securities and Exchange Commission (“Commission”) the proposed rule change as described in Items I, II and III below, which Items have been prepared by the clearing agency. FICC filed the proposed rule change pursuant to Section 19(b)(3)(A) of the Act  <SU>3</SU> <FTREF/> and Rule 19b-4(f)(2) thereunder. <SU>4</SU> <FTREF/> The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. <FTNT> <SU>1</SU>  15 U.S.C. 78s(b)(1). </FTNT> <FTNT> <SU>2</SU>  17 CFR 240.19b-4. </FTNT> <FTNT> <SU>3</SU>  15 U.S.C. 78s(b)(3)(A). </FTNT> <FTNT> <SU>4</SU>  17 CFR 240.19b-4(f)(2). </FTNT> <HD SOURCE="HD1">I. Clearing Agency's Statement of the Terms of Substance of the Proposed Rule Change</HD> The proposed rule change consists of modifications to FICC's Government Securities Division (“GSD”) Rulebook (“GSD Rules”) and Mortgage-Backed Securities Division (“MBSD”) Clearing Rules (“MBSD Rules”) (“MBSD Rules” and together with the GSD Rules, the “Rules”)  <SU>5</SU> <FTREF/> in order to (1) modify the Clearing Fund Maintenance Fee (“Maintenance Fee”) of GSD and MBSD; (2) remove the Sponsored GC Pre-Payment Assessment from the GSD Rules, and (3) adopt new pass-through fees in the GSD Rules that reflect fees charged by the Clearing Agent Bank. In addition, FICC is proposing changes to the GSD Rules to assist Members to better understand the pass-through fees. <FTNT> <SU>5</SU>  Capitalized terms not defined herein are defined in the GSD Rules and the MBSD Rules, as applicable, available at <E T="03">www.dtcc.com/legal/rules-and-procedures.</E> </FTNT> <HD SOURCE="HD1">II. Clearing Agency's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change</HD> In its filing with the Commission, the clearing agency included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The clearing agency has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. <HD SOURCE="HD2">(A) Clearing Agency's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change</HD> <HD SOURCE="HD3">1. Purpose</HD> FICC is proposing to amend the GSD Rules and the MBSD Rules in order to (1) modify the Maintenance Fee of GSD and MBSD, (2) remove the Sponsored GC Pre-Payment Assessment from the GSD Rules, and (3) adopt new pass-through fees in the GSD Rules that reflect fees charged by the Clearing Agent Bank in connection with the GSD global collateral services. In addition, FICC is proposing to revise the description of Clearing Agent Bank pass-through fees in the GSD Fee Structure of the GSD Rules. <HD SOURCE="HD3">Proposed Modification of the Clearing Fund Maintenance Fee</HD> The Maintenance Fee is designed to (i) diversify FICC's revenue sources and mitigate its dependence on revenues driven by trading volumes, and (ii) add a stable revenue source that would contribute to FICC's operating margin by offsetting increasing costs and expenses. The Maintenance Fee was implemented in 2016  <SU>6</SU> <FTREF/> and subsequently amended in 2024. <SU>7</SU> <FTREF/> Currently, the Maintenance Fee is calculated monthly, in arrears, as the product of (A) 0.085% and (B) the average of each Member's Required Fund Deposit as of the end of each day, for the month, multiplied by the number of days in that month and divided by 360. <FTNT> <SU>6</SU>  Securities Exchange Act Release No. 78529 (Aug. 10, 2016), 81 FR 54626 (Aug. 16, 2016) (SR-FICC-2016-004). </FTNT> <FTNT> <SU>7</SU>  Securities Exchange Act Release No. 101947 (Dec. 17, 2024), 89 FR 104595 (Dec. 23, 2024) (SR-FICC-2024-012). </FTNT> FICC operates a cost-plus pricing model. Accordingly, FICC's fees are cost-based plus a markup. As part of FICC's annual pricing review process and budgeting for 2026, FICC identified opportunities to better align fees and costs for FICC. Specifically, FICC is proposing a reduction in the Maintenance Fee percentage from 0.085% to 0.075% for both GSD and MBSD. To effectuate the proposed fee change described above at GSD, FICC is proposing to change the Maintenance Fee percentage from “0.085%” to “0.075%” in Section XIII (Clearing Fund Maintenance Fee) of the Fee Structure in the GSD Rules. Similarly, for MBSD, FICC is proposing to change the percentage referenced under the Clearing Fund Maintenance Fee from “0.085%” to “0.075%” in Section I (Fees) of the Schedule of Charges Broker Account Group and Schedule of Charges Dealer Account Group, respectively, in the MBSD Rules. In addition, FICC is proposing changes to enhance the clarity of the Rules. Specifically, in Section XIII (Clearing Fund Maintenance Fee) of the Fee Structure in the GSD Rules as well as under the Clearing Fund Maintenance Fee in Section I (Fees) of the Schedule of Charges Broker Account Group and Schedule of Charges Dealer Account Group, respectively, in the MBSD Rules, FICC is proposing to remove the extraneous reference to “in the Clearing Fund” and replace “for” with “in” when referencing the number of days in a month. <HD SOURCE="HD3">Proposed Removal of the Sponsored GC Pre-Payment Assessment</HD> FICC is proposing to eliminate the Sponsored GC Pre-Payment Assessment from the GSD Rules. The Sponsored GC Pre-Payment Assessment is a $250,000 assessment that FICC collects from a Sponsoring Member at the time the Sponsoring Member onboards into the Sponsored GC Service. <SU>8</SU> <FTREF/> Pursuant to the GSD Rules, FICC credits that amount back to the Sponsoring Member against its fees for use of the Sponsored GC Service until the earlier of (i) the assessment being completely depleted and (ii) thirty-six (36) months after the Sponsoring Member onboards into the Sponsored GC Service. <SU>9</SU> <FTREF/> <FTNT> <SU>8</SU>   <E T="03">See</E> GSD Rule 1 (definition of “Sponsored GC Pre-Payment Assessment”) and GSD Fee Structure, Section VII, <E T="03">supra</E> note 5. </FTNT> <FTNT> <SU>9</SU>   <E T="03">Id.</E> </FTNT> The Sponsored GC Pre-Payment Assessment was adopted in 2020, when FICC was developing the Sponsored GC Service, to ensure Sponsoring Members' support of and readiness to participate in the Sponsored GC Service and justify FICC's investment in building the new technology infrastructure that was necessary to implement the Sponsored GC Service. <SU>10</SU> <FTREF/> Since that time, the Sponsored GC Service has been consistently used by Sponsoring Members, and FICC has recently proposed expansions to the Sponsored GC Service. <SU>11</SU> <FTREF/> Therefore, FICC no longer believes the Sponsored GC Pre-Payment Assessment is necessary and is proposing to eliminate the assessment from the GSD Rules to further encourage the use of the expanded Sponsored GC service by Sponsoring Members. <FTNT> <SU>10</SU>  Securities Exchange Act Release No. 90386 (Nov. 10, 2020), 85 FR 73329 (Nov. 17, 2020) (SR-FICC-2020-013). </FTNT> <FTNT> <SU>11</SU>  Securities Exchange Act Release No. 104085 (Sept. 26, 2025), 90 FR 46981 (Sept. 30, 2025) (SR-FICC-2025-019) (“CIL Filing”) (proposing a new offering within the Sponsored GC Service, to be referred to as the Collateral-in-Lieu, or “CIL,” Service and to permit the clearing of done-away Sponsored GC Trades, executed between the Sponsored Member and other permitted counterparty). </FTNT> The proposed change would remove the definition of the Sponsored GC Pre-Payment Assessment from Rule 1 and would remove the description of the Sponsored GC Pre-Payment Assessment from Section VII of the GSD Fee Structure, which describes the responsibilities of Sponsoring Members to pay fees in connection with the Sponsored Service. <HD SOURCE="HD3">Proposed Adoption of Clearing Agent Bank Pass-Through Fees</HD> FICC is proposing to include in the GSD Fee Structure new pass-through fees that would be charged by Bank of New York (“BNY”), as a Clearing Agent Bank, and passed to Members by FICC. The additional pass-through fees would include a new fee to be referred to as a “Core Services Fee” of 0.15 basis points calculated on the settlement amount of the Start Leg of all Sponsored GC Trades (including trades that would be cleared through the proposed CIL Service, to be referred to as Sponsored GC CIL Trades)  <SU>12</SU> <FTREF/> and triparty trades that would be cleared through the Agent Clearing Service, to be referred to as “ACS Triparty Trades.”  <SU>13</SU> <FTREF/> The additional pass-through fees would also include a fee to be referred to as the “Enhanced Services Fee” of 0.35 basis points calculated on the settlement amount of the Start Leg of all Sponsored GC CIL Trades. The Enhanced Services Fee would be charged on Sponsored GC CIL Trades in addition to the Core Services Fee. Both of the new pass-through fees would be assessed to the Repo Party to the transactions. <FTNT> <SU>12</SU>   <E T="03">Id.</E> </FTNT> <FTNT> <SU>13</SU>  Securities Exchange Act Release No. 104084 (Sept. 26, 2025), 90 FR 47045 (Sept. 30, 2025) (SR-FICC-2025-021) (“A ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 27k characters. Full document text is stored and available for version comparison. ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━