Statement of Support

Chairman Gary Gensler

July 10, 2012

Proposed Exemption from the Clearing Requirement for Certain Swaps Executed by Cooperatives

I support the proposed rule that would permit certain cooperatives to choose not to clear member-related swaps.

One of the primary goals of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) was to lower risk to the financial system by requiring standardized swaps between financial entities to be cleared.

Congress provided that non-financial entities, such as farmers, ranchers, manufacturers and other end users, should be able to choose whether or not to clear those swaps that hedge or mitigate commercial risks.

Cooperatives act on behalf of and are an extension of their members. Thus, I believe it is appropriate that those cooperatives made up entirely of members that could individually qualify for the end-user exception should qualify as well themselves as end users in certain circumstances.

The proposed cooperative exemption is narrowly tailored, and extends only to:

• Swaps entered into with members of the cooperative in connection with originating loans for members; and

• Swaps entered into by a cooperative to hedge or mitigate risks associated with member loans or member loan related swaps.

Last Updated: July 10, 2012