IOSCO Consults on Global Developments in Securitization Regulation

June 11, 2012 /

The International Organization of Securities Commissions (IOSCO)s has published a Consultation Report on Global Developments in Securitization Regulation, which seeks public comment on policy issues arising from the work of its Task Force on Unregulated Markets and Products (TFUMP).

The Consultation Paper is in response to a request from the Financial Stability Board (FSB) as part of its work to strengthen oversight and regulation of the shadow banking system. The FSB asked IOSCO, in coordination with the Basel Committee on Banking Supervision, to conduct a stock-taking exercise on the requirements for risk retention and measures enhancing transparency and standardization of securitization products, and to develop policy ecommendations as necessary.

The FSB’s request followed earlier IOSCO and Joint Forum work aimed at regulatory initiatives to support recovery of securitization markets.
The Consultation Paper is based on a survey of member jurisdictions and builds on earlier work undertaken by staff of the US Securities Exchange Commission and the European Commission on developments in the US and the EU.

The paper provides background to IOSCO’s work and a snapshot of global securitization activity; makes observations about regulatory approaches in jurisdictions covered by the work and outlines and assesses the extent of differences.

It also makes policy recommendations addressing differences in approaches to risk retention; improvements in transparency; and measures to standardize disclosure.

Co-chair of TFUMP and Chairman of the Australian Securities and Investments Commission (ASIC), Greg Medcraft, said: “The Consultation Paper continues the leading role IOSCO has played in supporting the sustained recovery of securitization markets globally. It again focuses on the importance of securitization as a market-based source of finance and the role cross border issuances play in deepening markets and supporting growth in the real economy.”

Task Force co-chair and Managing Director of the Autorité des Marchés Financiers (AMF) Edouard Vieillefond, said: “The Consultation Paper – which follows analysis of regulatory developments in over 20 jurisdictions – provides us with an opportunity to work toward greater harmonization in our approach to regulation of this important sector. We look forward to receiving industry views on the measures we propose.”

Comments on the Consultation Paper are sought by 6 August 2012.


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