Washington, D.C., January 25, 2023 – SIFMA today issued the following statement from president and CEO Kenneth E. Bentsen, Jr. on the proposed rule from the Securities and Exchange Commission (SEC), “Prohibition Against Conflicts of Interest in Certain Securitizations”:

“SIFMA is reviewing the newly proposed SEC rule prohibiting conflicts of interest in certain securitization transactions with our members, with a particular focus on if and how the SEC addressed the numerous concerns commenters expressed regarding the previous version of the proposal, including those submitted by SIFMA. Asset-backed securities are a material source of funding for consumer and corporate credit in the United States, such as mortgages and auto loans, and we must ensure that these markets remain active and liquid so as to support the consumers, businesses, and the broader economy that depends on them.  Overly broad or unclear rules that suppress beneficial activity will have real and harmful economic consequences.

“We are also concerned that the Commission is only allowing a 30-day comment period from when the rule proposal is officially published in the Federal Register.  Today’s proposal is a complicated and important rulemaking mandated by the Dodd-Frank Act, which was passed more than a decade ago, so we do not see a reason to move with such haste, especially since this rule applies to the same markets impacted by other pending SEC rulemakings such as a proposed best execution rule for fixed income securities.  We and others in the industry have repeatedly stressed to SEC Chair Gensler that sufficient time for meaningful public input into individual proposals and more holistically on the SEC’s rulemaking agenda and the possible interconnectedness of these proposals is vitally important and ultimately could have a significant impact on savers, investors, capital formation, and economic growth and job creation.”

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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 one million employees, we advocate on 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).