NABL in the News

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SEC Gets Feedback: NABL, GFOA Weigh In on Rating Issues

WASHINGTON - The Securities and Exchange Commission should require credit rating agencies, rather than issuers, to send rating information about municipal securities directly to the Municipal Securities Rulemaking Board's EMMA system, issuers and bond attorneys argued last week.

In comment letters filed with the SEC, the Government Finance Officers Association and the National Association of Bond Lawyers both argued that it is unduly burdensome for issuers to provide timely notice of rating changes, often because of the frequency with which bond insurer ratings have changed in the past two years with little or no direct notice to issuers.

In addition, some bond issues are insured in the secondary market by the underwriter rather than the issuer, and the issuer may have no knowledge that the bond issue is susceptible to a downgrade because of a downgrade on the insurer, GFOA said.

Both groups asked the SEC to revise the qualifications for nationally recognized statistical rating organizations so that they must file rating information directly with the MSRB's Electronic Municipal Market Access site...

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