Omnibus loans & Reallocations

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• Omnibus loans & Reallocations

Omnibus loans & Reallocations

Status: SEC APPROVED RULES 2.1.25 Last Updated: 02 Jan 2025

FINRA stated its understanding that, under Rule 10c-1a(d), loan modifications are required to be reported once they are finalized, and that indicative terms are not reportable.

FINRA stated that, in the context of omnibus loans and reallocations, proposed Rule 6530 does not alter which entities must be reported as parties to a loan, whether a change to the parties to a loan triggers a reporting obligation, or whether such report must reflect a modification or a new loan (and therefore, also a termination of the prior loan); rather, these obligations are prescribed by Rule 10c-1a as discussed in the Rule 10c-1a Adopting Release.

FINRA stated its understanding that Rule 10c-1a generally requires that a change in the parties to a loan be reported as a termination of the prior loan and the initiation of a new loan (reflecting the new parties, if known).

In adopting Rule 10c-1a, the Commission stated that whether a reallocation of a loan among participants in a lending program requires the reporting of a new covered securities loan depends upon the facts and circumstances, including the structure of such lending program.

The Proposal’s information reporting requirements concerning omnibus loans that are Covered Securities Loans, by mirroring the requirements in Rule 10c-1a(e)(1), are reasonably designed to facilitate the collection of loan information consistent with Rule 10c-1a.