SIFMA and Others Submit Supplemental Comments to Federal Agencies on Credit Risk Retention Rules

SIFMA and several sponsors of tender option bond ("TOB") programs (the "Sponsors") submitted additional comments to multiple federal agencies, including the SEC, FDIC and the Board of Governors of the Federal Reserve System (the "Agencies"), regarding proposed rules to implement the credit risk retention requirements of Exchange Act, Section 15G (the "Proposed Rules").

Since the filing of SIFMA and the Sponsors' previous comment letter in October 2013, the Agencies have adopted final regulations of the Volcker Rule. Additionally, the Investment Company Institute and its members met with representatives of the Agencies to discuss the TOB market and make suggestions on ways to change the Proposed Rules.

In light of these developments, SIFMA and the Sponsors stated that they are providing the desired technical changes to the Proposed Rules in their comment letter. According to SIFMA and the Sponsors, the proposed technical changes do not reflect substantive changes to the text. They urged the Agencies to adopt a credit risk retention rule that does not disrupt the TOB market which, they stated, is "large, healthy, and critical to the broader financial markets by virtue of, among other things, creating demand in the municipal securities market and serving the demands of the tax exempt money market fund market."

See: SIFMA and TOB Programs Comment Letter. Related news: SIFMA and TOB Programs Submit Comments to Federal Agencies on Credit Risk Retention (October 31, 2013); SIFMA Submits Comments on Credit Risk Retention Proposed Rule (October 30, 2013); Agencies Propose Rule Change Regarding Credit Risk Retention of Securitized Assets (Fed. Reg.) (October 18, 2013).