Chatham Financial to Testify Before U.S. House Subcommittee on Derivatives End-User Issues

Derivatives expert will discuss the need for legislation that promotes certainty for Main Street businesses at today’s Capital Markets Subcommittee hearing

Kennett Square, Pa., March 16, 2011 — Chatham Financial today announced that Luke Zubrod, director of the firm’s Derivatives Regulatory Advisory Service, will testify before the U.S. House of Representatives’ Capital Markets Subcommittee in a hearing to be held today, March 16 at 2:00 p.m. in Washington D.C. He will testify on behalf of the Coalition for Derivatives End-Users, a broad-based coalition representing thousands of companies across the U.S. that utilize derivatives to manage day-to-day business risks.

The hearing will examine five legislative proposals that are designed to promote job creation, reduce economic uncertainty, and promote capital formation. Mr. Zubrod will testify regarding the “The Business Risk Mitigation and Price Stabilization Act.” The Act is expected to clarify that end users – including manufacturers, real estate developers, and utilities – that use derivatives to reduce business risk are not subject to requirements that would divert working capital from their businesses.

In his testimony, Mr. Zubrod will discuss several key end-user concerns, including:
• The negative effects of margin requirements on end-users;
• The need for additional time to promulgate derivatives rules;
• The impact excessive capital requirements could have on prudent risk management;
• The need to carefully implement real-time reporting rules to ensure efficient pricing for larger transactions; and
• The application of margin requirements to pre-existing contracts.

“We appreciate the subcommittee’s bipartisan efforts to ensure Main Street businesses are not unduly burdened by regulations aimed at curbing risks associated with firms whose derivatives use makes them systemically risky,” said Mr. Zubrod. “Margin requirements for end users could require substantial sums of money to be unnecessarily diverted from job-creating business investment. With unemployment still very high, the subcommittee’s work to clarify that end users will not be subject to such requirements is essential.”

Mr. Zubrod, and Chatham senior advisor Sam Peterson, will be available for interviews to discuss news stemming from today’s hearing, as well as additional developments pertaining to the ongoing derivatives regulatory reform. To coordinate an interview, please contact Jake Daubenspeck at jdaubenspeck@cjpcom.com or (203) 254-1300 ext. 107.

About Chatham Financial

Chatham Financial is the largest independent interest rate and foreign exchange risk management advisory company, serving clients in the areas of hedge strategy development, derivatives documentation, transaction execution, hedge accounting IAS 39 and derivatives and debt valuations. Founded in 1991, Chatham provides innovative solutions in both the derivatives and debt markets through a powerful combination of advisory services and technology solutions. Annually Chatham advises more than 1,000 clients on over 8,000 transaction and over $350 billion notional from its offices in the Europe, Asia and the U.S.