The Securities Industry and Financial Markets Association (SIFMA) today issued the following statement from Richard Dorfman, managing director and head of SIFMA’s Securitization Group, on 436(g), the provision of regulatory reform which is impacting the public asset-backed securities market:
“SIFMA is deeply concerned about the impact this provision of regulatory reform is already having on the public asset-backed securities market. This is a real and significant unintended outcome with real consequences to the general economy. Public securitization is a significant source of finance for consumers and businesses, with issuance of over $7 trillion since 2001. This provision of the Bill has created a roadblock to the issuance of any deals in these markets due to the interaction of provisions of Reg AB and the refusal of the major rating agencies to consent to the inclusion of their ratings in transaction documents.
“By stopping this market cold, this situation will negatively impact both credit availability and economic recovery. The alternative for issuers is to only place deals into the private market, which decreases transparency to both market participants and regulators. It is critical that this consequence be addressed so markets can move forward in all areas. SIFMA looks forward to working with the SEC and other market participants on unfreezing this important sector of the market.”
