October 29, 2014

Muni ComMUNIcations - Legislative, regulatory and tax news for municipal securities


SIFMA Submits Comments In Response to MSRB Request for Input on Strategic Priorities
On October 23, SIFMA provided comments to the Municipal Securities Rulemaking Board (MSRB) in response to MSRB's request for input on its strategic priorities (Notice 2014-16) for the coming year.

Notice 2014-16 poses several questions in the context of the MSRB’s four key strategic goals: municipal advisor (MA) regulation, municipal entity protection, market efficiency and price transparency. SIFMA said its comments covers all four area and offers recommendations on MSRB governance issues that relate closely to the execution of initiatives under the strategic goals.

SIFMA also proposed the addition of a fifth strategic goal: reduce the cost of regulatory compliance.

MSRB to Create Supervision and Compliance Requirements for Municipal Advisors
On October 24, the MRSB received approval from the SEC to create the first new rule for municipal advisors since the SEC released its final registration rule for these professionals in September 2013. MSRB Rule G-44 establishes baseline supervisory and compliance obligations for municipal advisors.

The new supervision requirements will take effect on April 23, 2015, providing firms six months to implement the required policies and procedures. By April 23, 2016, the chief executive officers of municipal advisor firms must make the first of their annual certifications in writing that the municipal advisor has in place processes to establish, maintain, review, test and modify written compliance procedures and written supervisory procedures reasonably designed to achieve compliance with applicable rules.

SIFMA Submits Comments to the SEC on MSRB Proposed Rule G-44, Draft Amendments to Rules G-8 and G-9

MSRB Requests Comment on Extending Gifts Rule to Municipal Advisors
On October 23, the MSRB requested comment on a proposal to establish limitations on gifts given by municipal advisors in the professional capacity. The amendments to Rule G-20 are designed to extend the provisions of the rule to municipal advisors.

MSRB Rule G-20 currently establishes a $100 limit for gifts given by dealers to employees of entities engaged in municipal securities activities, subject to certain exceptions. The draft amendments would hold municipal advisor gift-giving to this same limit. Additionally, the MSRB is proposing to codify guidance on the application of the rule in particular situations that is currently in several MSRB and MSRB-referenced FINRA interpretive materials.

The draft amendments for municipal advisors also would explicitly prohibit dealers and municipal advisors from receiving reimbursement of certain entertainment expenses from the proceeds of an offering of municipal securities.

Comments are due no later than December 8, 2014. The MSRB will host a webinar on the proposed changes on Thursday, November 13, 2014 at 3 p.m. ET. Register for the webinar.

SIFMA Release Statement on Final Risk Retention Rule
SIFMA President and CEO Kenneth E. Bentsen, Jr. said the final credit risk retention rule announced by regulators on October 21 “will help clarify the regulatory 'rules of the road' for securitization,” and also “bring some relief to the regulatory uncertainty that has been a negative factor in the recovery of non-government guaranteed mortgage securitization.”

“We are pleased that the regulators finalized the adherence of the QRM definition to the CFPB's QM definition, which is a path SIFMA supported in its 2013 comments,” Bentsen said. “On the other hand, we are disappointed that the regulators did not appear to respond to the numerous commenter requests to tailor the risk retention rules for CLOs, and are concerned that the rules may have a negative impact on the ability of CLOs to fund credit creation.  This is important because CLOs are a key source of funding for Main Street businesses and other corporate borrowers, and this funding could become more expensive and less available.”

"There are many other important aspects of the rule proposal that we will review with our members, given that those will apply to non-QRM loans and all other asset classes, such as credit cards, tender option bonds, and student loans," Bentsen said.

SIFMA Statement
Overview of Risk Retention
SIFMA Risk Retention Comparison
SIFMA and TOB Programs Submit Comments to Multiple Federal Agencies on Credit Risk Retention
SIFMA and TOB Programs Submit Supplemental Comments to Multiple Federal Agencies on Credit Risk Retention

There’s No ‘One Size Fits All’ Financial Advisor | by SIFMA President and CEO Kenneth E. Bentsen, Jr.
SIFMA President and CEO Kenneth E. Bentsen, Jr., responds to a recent New York Times article that indicates some types of financial advisors can be trusted to offer cost-effective, suitable advice, while others are lacking. "Retail investors may, and do, choose among different models that provide investment services, including brokerage, money management and advice. It doesn't mean that one is better than another," Bentsen writes, noting that each model is subject to regulatory oversight. Continue reading at Pennsylvania + Wall and learn more about SIFMA's call for a uniform fiduciary standard for registered investment advisors and broker-dealers, when they provide the same type of service.




Hear From Top Regulators and Leaders in the Municipal Bond Markets at the 2014 SIFMA Annual Meeting
This year at the 2014 SIFMA Annual Meeting, we will hear from top regulators and leaders in the Municipal Bond Markets in a session entitled, Building Communities: Landmark Changes in Municipal Bond Markets. Legislators, regulators, and industry experts have made recommendations to improve market structure and regulation, but what topics should be given priority? Should municipal bond interest remain tax exempt? Should issuer disclosure practices be more directly regulated? Is the transparency of the market sufficient to support its size and importance? What are the regulators’ priorities regarding enforcement?

This panel of market and regulatory leaders will discuss the issues under consideration and try to develop a framework for a thoughtful review of these important issues.

Panel Moderator
Lynn Hume
Washington Bureau Chief
The Bond Buyer
Featured Panelists
Andrew Ceresney
Director, Division of Enforcement
Kent Hiteshew
Director, Office of State and Local Finance
U.S. Department of Treasury
Chris Hamel
Managing Director and Head of Municipal Finance Group
Samuel Ramirez Jr.
President & CEO
Ramirez Asset
Click to view the full program and sign-up today.

SIFMA LinkedIn Group & Facebook Exclusive: Win a Complimentary Pass to Our 2014 Annual Meeting 
“Follow” our LinkedIn Company Page for a chance to win a complimentary pass to SIFMA’s 2014 Annual Meeting. This contest is being offered exclusively to SIFMA’s LinkedIn Group members and those who “like” us on Facebook. Follow our LinkedIn Company Page!

SIFMA YouTube Channel: Meeting the Challenges of a Global Economy
From employment to saving, what do we need to do to ensure America is meeting the changing demands of today and tomorrow? Watch as Lloyd Blankfein, Chairman & CEO of Goldman Sachs, and others weigh in during SIFMA's 2013 Annual Meeting. Sign-up for SIFMA’s 2014 Annual Meeting: Join today’s foremost thought leaders in New York City and hear their perspectives on how the financial services industry will best serve tomorrow's economy.

Sign up Today: Invest It Forward Volunteer Opportunities
Teachers across the country are asking you, our SIFMA member firms, to visit their SMG classes to promote financial and capital markets literacy this fall! Join SIFMA as we Invest It Forward™. Invest it Forward™ connects teachers and classrooms with financial industry professionals and firms to give young Americans a solid understanding of the capital markets system and the invaluable tools to achieve their dreams.

It’s so easy.  You register online, select a local school and The SIFMA Foundation provides you with a tailor-made presentation based on the subject your teacher requests.  Do it alone or as part of a team.  You too can host a classroom at your firm’s office. Register directly or contact Michelle Noguchi at mnoguchi@sifma.org / 212-313-1224 for further details.



Join Our Honorees and Special Guest Speaker to Support Youth Financial Education – Foundation Tribute Dinner, Nov. 10

This year, SIFMA Foundation is honoring Mr. David Carroll, Senior Executive Vice President of Wells Fargo; Dr. Rudolph F. Crew, President, Medgar Evers College and our special guest speaker, Mrs. Mary John Miller, Former Under Secretary for Domestic Finance, United States Department of the Treasury to Support Youth Financial Education for their dedication and long-standing commitment to financial education at the 2014 Tribute Dinner, Invested in Financial Capability.

Your generous donation will help children become financially capable will ensure that they are well prepared to make smart financial decisions throughout their life, and provide a foundation for the youth of today to be the vital contributors to our society and economy of tomorrow. Register Today.

Full Program Available: SIFMA Diversity Conference: Nov. 13-14, St. Louis

Keynote speakers Barney Frank, Former Chairman of the Committee on Financial Services and U.S. House of Representatives, and Bonnie St. John, Olympic Athlete and Best-Selling Author, will kick off this comprehensive program focusing on the vision for global diversity and inclusion.

Join SIFMA, industry leaders, and government officials in St. Louis to examine the trends that are shaping the future workplace, hear how to effectively manage and monitor the impact of your Diversity & Inclusion programs, understand why diversity matters on corporate boards, and much more. Register Today.



Pandemic Influenza Continuity Exercise Series: Multiple Dates, Sep. – Dec., 2014
SIFMA is coordinating with government and private organizations to sponsor a two year series of pandemic influenza continuity exercises to mitigate vulnerabilities during a pandemic influenza outbreak; identify gaps or weaknesses in pandemic planning or in organization pandemic influenza continuity plans, policies, & procedures; and encourage public and private organizations to jointly plan for, and test, their pandemic influenza plans. FEMA Pandemic Exercise

New 2015 Edition of "Sources: A Resource Directory"
Sources is an easy-to-use guide of products and services for the securities and financial industry. Service providers in financial services are invited to submit information for publication; SIFMA’s Associate Members are included at no cost as a benefit of membership. View: Sources

SIFMA Bookstore Spotlight: The Fundamentals of Municipal Bonds
This informative volume is the newly revised and updated sixth edition of the long-heralded classic text on the municipal securities market. The text provides a basic understanding of the market for a wide range of readers, including experienced professionals – such as investment bankers, traders, brokers, and professional investors – as well as public officials, academicians, students, and sophisticated individuals. Read More and Purchase Book


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