Information on the SEC's April 7 ABS Reform Proposal
SEC’s 2010 Asset Backed Securities Reforms
On April 7, 2010 the SEC voted to propose a sweeping set of revisions to existing rules and new rules that would, if implemented, fundamentally alter the regulatory framework that surrounds the securitization process.
Relevant Materials
- A webcast of the SEC’s April 7 meeting and discussion is available here;
- A press release from the SEC is available here;
- Transcripts of the Commissioner’s statements are available here;
- The full text of the rule filing is available here.
- Comments will be due 90 days after the rule proposal appears in the Federal Register (expected publication in mid-April)
- SIFMA’s April 7 press release
- Bingham's April 20 informational memo on the rule proposal
The rule filing is extensive and addresses nearly all aspects of the securitization process, from a regulatory perspective. Among other things, the proposed rules would:
- Remove references to credit ratings from the requirements for ABS shelf registrations and replace them with requirements for:
- 5% risk retention by the sponsor of the transaction
- CEO certification
- 3rd party review of repurchase requests
- Continuation of filing for ongoing reporting;
- Fundamentally change the framework and requirements for the issuance of private ABS transactions under rule 144A and Reg D.
- Mandate expanded asset-level disclosure for many ABS, among other changes to current disclosure requirements;
- Revise the offering process and implement new rules for timing and content of prospectus deliveries ;
We will continue to update this page with relevant information as this issue progresses.
Please contact Chris Killian at 212-313-1126 with any questions or for more information.