COVID-19 Updates 5/6

On the Hill

Yesterday, the U.S. Senate Banking Committee held its first hearing since the coronavirus pandemic began, hearing testimony from two Administration nominees, Mr. Brian Miller to serve as Special Inspector General for Pandemic Recovery (SIGPR) and Mrs. Dana Wade, Assistant Secretary at the U.S. Department of Housing and Urban Development. Mr. Miller fielded questions from Senators both in the Committee hearing room and via video conference touching on the importance of an independent inspector general, his background, and plan for investigation implementation. Committee Ranking Member Sherrod Brown (D-OH) asked if the SIGPR had authority to review Federal Reserve actions with respect to the lending facilities set up under the CARES Act. Mr. Miller responded that he believes if the money flows from the Treasury to the Federal Reserve for the lending facilities, that falls under his umbrella of review. Important to note is that a party receiving money may be scrutinized by the Inspector General.  

Short Sale Bans  

On May 18, France’s temporary short sale ban is scheduled to expire, but the French regulator (AMF) may choose to renew the ban before then.  In a  letter to President Emanuel Macron, AMF Chair Robert Ophèle expressed the view that “there is every reason to believe that this [short sale ban] measure, which restricts the capacity for making money from the distress of our economy, did not harm the market’s functioning.” He added that short selling does little to support price discovery in the current context, and that short selling’s “procyclical nature could be potentially disastrous.”  In a related press conference yesterday, Ophele questioned why short sale restrictions have not been implemented on an EU-wide basis. MFA has updated our data analysis to show that France’s equity markets have fared poorly relative to their peer countries who have not adopted a ban. We will also develop specific arguments to address the French concern that short selling is procyclical – a view that Spanish regulators have also expressed.   

CFTC Global Markets Advisory Committee  

The CFTC announced the agenda for its Global Markets Advisory Committee virtual meeting on May 19, which will include international coordination efforts in the time of COVID-19, and a report from its Subcommittee on Margin Requirements for Non-Cleared Swaps on recommendations regarding the implementation of initial margin requirements for non-cleared swaps. 

COVID-19 Charitable Response

In response to requests from members, MFA has created a COVID-19 Charitable Response members-only webpage that details the organizations our members are supporting in response to the COVID-19 public health crisis and recovery efforts. If you would like to recommend an organization that is engaging in relief and recovery efforts, please email