(a) A special memorandum account
(SMA) may be maintained in conjunction with a margin account. A single
entry amount may be used to represent both a credit to the SMA and
a debit to the margin account. A transfer between the two accounts
may be effected by an increase or reduction in the entry. When computing
the equity in a margin account, the single entry amount shall be considered
as a debit in the margin account. A payment to the customer or on
the customer’s behalf or a transfer to any of the customer’s other
accounts from the SMA reduces the single entry amount.
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(b) The SMA may contain the following entries:
(1) dividend and interest payments;
(2) cash not required
by this part, including cash deposited to meet a maintenance margin
call or to meet any requirement of a self-regulatory organization
that is not imposed by this part;
(3) proceeds of a sale of securities or
cash no longer required on any expired or liquidated security position
that may be withdrawn under section 220.4(e); and
(4) margin excess transferred from the
margin account under section 220.4(e)(2).
