Standards for payment systems.

CFR · 2024-01-01 · US · Title 12

(a) A designated financial market utility must implement rules, procedures, or operations designed to ensure that it meets or exceeds the following risk-management standards with respect to its payment, clearing, and settlement activities. (1) (2) (i) Are clear, transparent, and documented; (ii) Promote the safety and efficiency of the designated financial market utility; (iii) Support the stability of the broader financial system, other relevant public interest considerations such as fostering fair and efficient markets, and the legitimate interests of relevant stakeholders, including the designated financial market utility's owners, participants, and participants' customers; and (iv) Are designed to ensure— (A) Lines of responsibility and accountability are clear and direct; (B) The roles and responsibilities of the board of directors and senior management are clearly specified; (C) The board of directors consists of suitable individuals having appropriate skills to fulfill its multiple roles; (D) The board of directors includes a majority of individuals who are not executives, officers, or employees of the designated financial market utility or an affiliate of the designated financial market utility; (E) The board of directors establishes policies and procedures to identify, address, and manage potential conflicts (F) The board of directors establishes a clear, documented risk-management framework that includes the designated financial market utility's risk-tolerance polic

official document · source cfr-2024 · id 12:§ 234.3