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Regulatory Requirements
 3 Months Ended
Feb. 28, 2026
Broker-Dealer [Abstract]  
Regulatory Requirements Note 19. Regulatory Requirements
Net Capital
Jefferies LLC is a broker-dealer registered with the SEC and a
member firm of the Financial Industry Regulatory Authority
(“FINRA”) and is subject to the SEC Uniform Net Capital Rule
(“Rule 15c3-1”), which requires the maintenance of minimum net
capital, and has elected to calculate minimum capital
requirements using the alternative method permitted by Rule
15c3-1 in calculating net capital. Jefferies LLC, as a dually-
registered U.S. broker-dealer and futures commission merchant
(“FCM”), is also subject to Regulation 1.17 of the Commodity
Futures Trading Commission (“CFTC”) under the Commodity
Exchange Act, which sets forth minimum financial requirements.
The minimum net capital requirement in determining excess net
capital for a dually registered U.S. broker-dealer and FCM is equal
to the greater of the requirement under Rule 15c3-1 or Regulation
1.17. FINRA is the designated examining authority for Jefferies
LLC and the National Futures Association (“NFA”) is the
designated self-regulatory organization (“DSRO”) for Jefferies
LLC as an FCM.
Jefferies Financial Services, Inc. (“JFSI”) is registered with the
SEC as a Security-Based Swap Dealer (“SBS Dealer”) and an OTC
Derivatives Dealer (“OTCDD”) subject to the SEC’s SBS dealer
regulatory rules and the SEC’s net capital requirements. JFSI is
also registered as a swap dealer with the CFTC and is subject to
the CFTC’s regulatory capital requirements pursuant to the
minimum financial requirements for swap dealers. Additionally,
as a registered member firm, JFSI is subject to the net capital
requirements of the NFA. The SEC is the designated examining
authority for JFSI in its capacity as an SBS Dealer and OTCDD,
while the NFA is the DSRO for JFSI, as a CFTC registered swap
dealer.
Certain non-U.S. subsidiaries are subject to capital adequacy
requirements as prescribed by the regulatory authorities in their
respective jurisdictions. This includes Jefferies International
Limited (“JIL”), which is subject to the regulatory supervision and
requirements of the Financial Conduct Authority in the U.K. and
Jefferies GmbH, which is subject to the regulatory supervision of
the German Federal Financial Supervisory Authority.
At February 28, 2026, net capital and excess net capital were as
follows:
$ in thousands
Net
Capital
Excess Net
Capital
Jefferies LLC .................................................................
$1,448,011
$1,277,695
JFSI - SEC ......................................................................
333,245
298,800
JFSI - CFTC ...................................................................
333,245
300,126
JIL (1) .............................................................................
2,095,104
1,045,119
Jefferies GmbH (1) ......................................................
386,316
158,187
(1)Represents an equivalent capital requirement in the respective jurisdiction.
At February 28, 2026, Jefferies LLC, JFSI, JIL and Jefferies GmbH
are in compliance with their applicable requirements.
The regulatory capital requirements referred to above may
restrict our ability to withdraw capital from our regulated
subsidiaries.
Customer Protection and Segregation Requirement
As a registered broker dealer that clears and carries customer
accounts, Jefferies LLC is subject to the customer protection
provisions under SEC Rule 15c3-3 and is required to compute a
reserve formula requirement for customer accounts and deposit
cash or qualified securities into a special reserve bank account
for the exclusive benefit of customers. At February 28, 2026,
Jefferies LLC had $1.02 billion in cash and qualified U.S.
Government securities on deposit in special reserve bank
accounts for the exclusive benefit of customers.
As a registered broker dealer that clears and carries proprietary
accounts of brokers or dealers (commonly referred to as “PAB”),
Jefferies LLC is also required to compute a reserve requirement
for PABs pursuant to SEC Rule 15c3-3. At February 28, 2026,
Jefferies LLC had $596.1 million in cash and qualified U.S.
Government securities in special reserve bank accounts for the
exclusive benefit of PABs.
The qualified securities meeting the SEC Rule 15c3-3 customer
and PAB requirements are included in Cash and securities
segregated and Securities purchased under agreements to resell.
JFSI is exempt from the CFTC and SEC segregation rules.