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MSRB seeks comments on plan to provide greater information on municipal auction-rate securities
By Angela McDaniels
Tacoma, Wash., March 17 - The Municipal Securities Rulemaking Board (MSRB) is requesting comments on a plan to create a centralized system for the collection of market information about auction-rate securities, according to an MSRB news release.
MSRB noted that there is no source of comprehensive same-day information about auction-rate securities available to non-market professionals.
To increase the amount of information available to market participants, MSRB's plan would require dealers that operate auction-rate programs to report auction information to a central system operated by the MSRB. Auction results would have to be reported by 5 p.m. ET on the day that an auction occurs, and the proposed system would display this information immediately on a web site.
Data collected by the MSRB would include, among other things, clearing rates, reset rate information such as the number of days of the reset period and the minimum denomination, and bidding information such as number of bidders, the high and low bids and the par amount of securities allocated to bids at the clearing rate.
The MSRB said it continues to monitor the recent downgrades of municipal bond insurers and other short-term liquidity concerns that have created volatility in the market for municipal auction-rate securities as well as failed auctions. The organization is also monitoring whether there are any effects from the volatility in the market for auction-rate securities to the broader market for short-term municipal securities.
Comments on the proposed plan can be submitted to Justin Pica, uniform practice policy adviser, through April 21. More information is available at www.mrsb.org.
The MSRB is based in Alexandria, Va., and makes rules regulating dealers who deal in municipal bonds, municipal notes and other municipal securities.
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