---
kind: "section"
citation: "12 C.F.R. § 240.9"
title: "12"
number: "240.9"
heading: "Margin requirements."
url: "https://uscodex.org/cfr/12/240.9"
---

# §240.9. Margin requirements.

- (a) **Margin required.** A banking institution engaging, or offering to engage, in retail forex transactions must collect from each retail forex customer an amount of margin not less than:
  - (1) Two percent of the notional value of the retail forex transaction for major currency pairs and 5 percent of the notional value of the retail forex transaction for all other currency pairs;
  - (2) For short options, 2 percent for major currency pairs and 5 percent for all other currency pairs of the notional value of the retail forex transaction, plus the premium received by the retail forex customer; or
  - (3) **For long options, the full premium charged and received by the banking institution.**
- (b)
  - (1) **Form of margin.** Margin collected under [paragraph (a)](#a) of this section or pledged by a retail forex customer for retail forex transactions in excess of the requirements of [paragraph (a)](#a) of this section must be in the form of cash or the following financial instruments:
    - (i) Obligations of the United States and obligations fully guaranteed as to principal and interest by the United States;
    - (ii) General obligations of any State or of any political subdivision thereof;
    - (iii) General obligations issued or guaranteed by any enterprise, as defined in [12 U.S.C. 4502(10)](/usc/12/4502.md?p=10);
    - (iv) Certificates of deposit issued by an insured depository institution, as defined in section 3(c)(2) of the Federal Deposit Insurance Act ([12 U.S.C. 1813(c)(2)](/usc/12/1813.md?p=c-2));
    - (v) Commercial paper;
    - (vi) Corporate notes or bonds;
    - (vii) General obligations of a sovereign nation;
    - (viii) Interests in money market mutual funds; and
    - (ix) **Such other financial instruments as the Board deems appropriate.**
  - (2) **Haircuts.** A banking institution shall establish written policies and procedures that include:
    - (i) Haircuts for noncash margin collected under this section; and
    - (ii) **Annual evaluation, and, if appropriate, modification of the haircuts.**
- (c) **Major currencies.**
  - (1) for the purposes of paragraphs [(a)(1)](#a-1) and [(a)(2)](#a-2) of this section, major currency means:
    - (i) United States Dollar (USD)
    - (ii) Canadian Dollar (CAD)
    - (iii) Euro (EUR)
    - (iv) United Kingdom Pound (GBP)
    - (v) Japanese Yen (JPY)
    - (vi) Swiss Franc (CHF)
    - (vii) New Zealand Dollar (NZD)
    - (viii) Australian Dollar (AUD)
    - (ix) Swedish Kronor (SEK)
    - (x) Danish Kroner (DKK)
    - (xi) Norwegian Krone (NOK), and
    - (xii) **Any other currency as determined by the Board.**
- (d) **Margin calls; liquidation of position.** For each retail forex customer, at least once per day, a banking institution shall:
  - (1) Mark the value of the retail forex customer's open retail forex positions to market;
  - (2) Mark the value of the margin collected under this section from the retail forex customer to market;
  - (3) Determine whether, based on the marks in paragraphs [(d)(1)](#d-1) and [(d)(2)](#d-2) of this section, the banking institution has collected margin from the retail forex customer sufficient to satisfy the requirements of this section; and
  - (4) If, pursuant to [paragraph (d)(3)](#d-3) of this section, the banking institution determines that it has not collected margin from the retail forex customer sufficient to satisfy the requirements of this section then, within a reasonable period of time, the banking institution shall either:
    - (i) Collect margin from the retail forex customer sufficient to satisfy the requirements of this section; or
    - (ii) **Liquidate the retail forex customer's retail forex transactions.**

## Notes

### Authority

Authority: 7 U.S.C. 2(c)(2)(E), 12 U.S.C. 248, 321-338, 1813(q), 1818, 1844(b), 3106a, 3108.

### Source

Source: 78 FR 21027, Apr. 9, 2013, unless otherwise noted.