Covered Agency Transactions Multifamily Programs

• Overview
• How to Request an Addition to the Eligible Multifamily Programs
• Additional Eligible Multifamily Programs

Overview

Rule 4210(e)(2)(H)(ii)a.2. provides that: 

“[A] member is not required to include a counterparty’s Covered Agency Transactions in multifamily housing securities or project loan program securities in the computation of such counterparty’s net mark to market loss, provided such securities are issued in conformity with a program of an Agency, as defined in Rule 6710(k), or a Government-Sponsored Enterprise, as defined in Rule 6710(n), and are documented as Freddie Mac K Certificates, Fannie Mae Delegated Underwriting and Servicing bonds, or Ginnie Mae Construction Loan or Project Loan Certificates, as commonly known to the trade . . .”

FINRA expects that a Covered Agency Transaction in a CMO that is collateralized solely by multifamily housing securities or project loan program securities specified in Rule 4210(e)(2)(H)(ii)a.2. would be consistent with the scope of the exception.  In addition to Covered Agency Transactions in the multifamily housing securities or project loan program securities as specified in the rule, the exception under Rule 4210(e)(2)(H)(ii)a.2. is also available for Covered Agency Transactions in “such other multifamily housing securities or project loan program securities with substantially similar characteristics, issued in conformity with a program of an Agency or a Government-Sponsored Enterprise, as FINRA may designate by Regulatory Notice or similar communication.”

How to Request Inclusion as an Additional Multifamily Housing Security or Project Loan Program Security for Purposes of Rule 4210(e)(2)(H)(ii)a.2.

To request that a program be added to the list below, please email [email protected] with the following information:

• A brief explanation describing why securities issued under the program would qualify (for example, 
  explain why securities issued under the program are substantially similar to Freddie Mac K Certificates, Fannie Mae Delegated Underwriting and Servicing bonds, or Ginnie Mae Construction Loan or Project Loan Certificates, as applicable).
• Provide supporting documentation (for example, a link to the issuer’s webpage).

List of Additional Multifamily Housing Securities and Project Loan Program Securities