Application of Regulation Best Interest to Bank Dealers
Summary
SIFMA provided comments to the MSRB regarding Notice 2021-06 (the “Notice”), which proposes an amendment to MSRB Rule G-19 that would require bank dealers to comply with Securities Exchange Act Rule 15/-1 (“Regulation Best Interest”) when making recommendations of securities transactions or investment strategies involving municipal securities to retail customers.
SIFMA supports the proposed amendment to extend Regulation Best Interest to bank dealers, as defined in the Notice. Although our members do not normally conduct retail activity through their affiliated banks that would implicate this rule, we believe that regulatory parity among regulated entities, which this amendment achieves, is a worthwhile goal.
Excerpt
June 2, 2021
Ronald W. Smith
Corporate Secretary
Municipal Securities Rulemaking Board
1300 I Street NW, Suite 1000
Washington, DC 20005
Re: MSRB Notice 2021-06 – Application of Regulation Best Interest to Bank Dealers
Dear Mr. Smith,
The Securities Industry and Financial Markets Association (“SIFMA”)1 appreciates this opportunity to comment on the Municipal Securities Rulemaking Board’s (“MSRB”) Notice 2021-06 (the “Notice”),2 which proposes an amendment to MSRB Rule G-19 that would require bank dealers to comply with Securities Exchange Act Rule 15/-1 (“Regulation Best Interest”) when making recommendations of securities transactions or investment strategies involving municipal securities to retail customers. 3 SIFMA supports the proposed amendment to extend Regulation Best Interest to bank dealers, as defined in the Notice. Although our members do not normally conduct retail activity through their affiliated banks that would implicate this rule, we believe that regulatory parity among regulated entities, which this amendment achieves, is a worthwhile goal.
If any questions regarding the foregoing, please contact me at (212) 313-1130 or [email protected].
Sincerely,
Leslie M. Norwood
Managing Director and Associate General Counsel