According to the SEC, the comprehensive report includes recommendations to help improve the structure of the $3.7 trillion municipal securities market and enhance the disclosures provided to investors. The recommendations address concerns raised by market participants and others in public field hearings and meetings as well as the public comment process during the agency’s review, which was initiated by SEC Chairman Mary Schapiro in mid-2010 and led by SEC Commissioner Elisse Walter. The Report contains an overview of the municipal securities market, the regulatory structure and the roles of key market participants. The Report focuses on two key areas of concern in the municipal securities market: disclosure and market structure. The Commission provides a number of recommendations for potential further consideration, including legislative changes, Commission rulemaking, MSRB rulemaking and enhancement of industry “best practices.”
The SEC’s report discusses several disclosure issues including the timing and content of financial information, disclosures relating to pension and other post-employment benefit plans, derivatives use by issuers and obligated persons, and conflicts of interest including pay-to-play practices. The report also reviews the current structure of the municipal securities market and discusses potential initiatives to improve pre-trade and post-trade price transparency and support existing dealer pricing obligations.
BDA is reviewing all the legislative and regulatory recommendations made by the SEC and will be holding a conference call for its members in the coming days to discuss the impact such recommendations will have on the fixed income market.
An SEC Press Release outlining some of the Report’s recommendations can be found [here.]
The full Report can be found [here.]
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