MSRB Moves on SHORT System
Mar 12, 2010
On Wednesday, March 10, 2010, the Municipal Securities Rulemaking Board (MSRB) submitted rule changes to the Securities and Exchange Commission (SEC) that implement a new short term obligation rate transparency (SHORT) system for auction rate securities and variable rate demand obligations (VRDOs). Under the proposed rules, dealers will be required to exert "best efforts" to post "program documents" for VRDOs and auction rate securities. Program documents include bank letters of credit and standby bond purchase agreements for VDROs. The new rule will also require dealers to keep internal records of their attempts to track down such documents and to submit bidding information records following every auction.
To read the text of the new rule click here.