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FINRA adopts amendments to enhance transparency on Treasury securities data

On Behalf of | Mar 19, 2024 | FINRA Compliance

The Financial Industry Regulatory Authority said it has adopted amendments to enhance transparency in the U.S. Treasury securities market.

In Regulatory Notice 24-06 published on March 8, FINRA provided guidance to member firms about the action it had taken.

Under the amendments, FINRA will disseminate individual transactions in active U.S. Treasury securities at the end of the day as well as historically.  It will also set related fees for members and other professionals who choose to subscribe to the new set of transaction-level data. The information will be made publicly available and free of charge the next day on FINRA’s website for non-professionals using it for personal, non-commercial purposes.

The amendments relating to the end-of-day data take effect on March 25, while those relating to the historic data product take effect on April 1.

FINRA said its actions were taken in consultation with the Department of the Treasury.  The date disseminated at the end of the day will include information on individual transactions in Treasury securities that are “on-the-run nominal coupons”  These coupons are defined as “the most recently auctioned U.S. Treasury security that is a Treasury note or bond paying fixed rate nominal coupons starting after the close of the TRACE system (Trade Reporting and Compliance Engine) on the day of its auction through the close of the TRACE system on the day of the auction of a new issue for the next U.S. Treasury security of the same maturity. ”

The reported data will include the price and size of the trade, the counterparty type (i.e., dealer, customer, affiliate, or alternative trading system), a flag to indicate whether the trade was executed on an ATS, and other trade modifiers and indicators.  It will not include the market participant identifier or other identifying information regarding the parties to the trade.

FINRA also will provide historic data for Treasury securities that will contain transaction information on a six-month delayed basis. This would include the transactions contained in the Treasury End-of-Day TRACE Transaction File for the relevant period, with uncapped transaction sizes. The first data set will include information for transactions during the period from January 1, 2019, through September 30, 2023. Subsequent historic data sets for Treasury securities will be available on a quarterly basis.

The fee for professionals to access the Treasury End-of-Day TRACE Transaction File is $750/month or $250/month for qualifying tax-exempt organizations.   The fee for the Historic TRACE Data Set for Treasuries is $2,000/calendar year or $500/calendar year for qualifying tax-exempt organizations.

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