Request for Public Comment Regarding Proposed Rule 192
Summary
SIFMA provided comment to the U.S. Securities and Exchange Commission (SEC) on proposed Rule 192 under the Securities Act of 1933.
Excerpt
March 27, 2023
VIA ELECTRONIC MAIL ([email protected])
Vanessa A. Countryman
Secretary
Securities and Exchange Commission
100 F Street NE
Washington, DC 20549-1090
Re: Request for Public Comment Regarding Proposed Rule 192 “Conflicts of Interest Relating to Certain Securitizations” File Number S7-01-23
Dear Ms. Countryman,
The Securities Industry and Financial Markets Association (“SIFMA”)1 appreciates the opportunity to provide additional comments on proposed Rule 192 (the “Proposed Rule” or “Rule 192”) under the Securities Act of 1933. When adopted in its final form by the Securities and Exchange Commission (the “Commission”), Rule 192 will implement Section 27B of the Securities Act (“Section 27B”),2 which prohibits certain material conflicts of interest in securitizations, subject to the exceptions set forth therein. We have provided this day a separate comment letter that addresses the broad concerns of the ABS community,3 but in this letter we would like to draw your attention to and provide comment on issues that relate to the potential application of the Proposed Rule in the specific context of tender option bond (“TOB”) transactions. TOBs are a somewhat unique type of ABS and, as discussed below, the Proposed Rule would hinder their use with no clear regulatory benefit and might actually add risk to TOB sponsors in the process.
1 SIFMA is the leading trade association for broker-dealers, investment banks and asset managers operating in the U.S. and global capital markets. On behalf of our industry’s nearly 1 million employees, we advocate for legislation, regulation and business policy, affecting retail and institutional investors, equity and fixed income markets and related products and services. We serve as an industry coordinating body to promote fair and orderly markets, informed regulatory compliance, and efficient market operations and resiliency. We also provide a forum for industry policy and professional development. SIFMA, with offices in New York and Washington, D.C., is the U.S. regional member of the Global Financial Markets Association (GFMA).
2 Section 27B was added to the Securities Act by Section 621 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”).
3 See SIFMA, the Asset Management Group of SIFMA and the Bank Policy Institute Comment Letter on Proposed Rule Implementing Rule to Prohibit Conflicts of Interest in Certain Securitizations (Mar. 27, 2023).