Deloitte & Touche is developing a web-based product to help issuers comply with disclosure requirements in the Securities and Exchange Commission's freshly minted rule on asset-backed securities, Regulation AB. Mark Scherer, a principal in Deloitte's technology and consulting group, said the application, allowing issuers to input vintage and deal information in a format compliant with Reg AB, should be available within the next two months. The application will also satisfy Reg AB's requirement that the information be posted on a Web site.
Scherer said the application will be easy for individual issuers to adjust for their specific needs, and will be able to accommodate any size issuer of any asset type. The tool will also enable issuers to include investor reports as .pdf or Excel spreadsheets. The flexibility of the application is important because Reg AB is a principles-based regulation at this point, and does not contain a great deal of specificity on what must be disclosed. Issuers are basically free to decide what information is material to their particular transactions. "What is significant and material is really up to the individual issuer," added Scherer.
For issuers with less than three years experience in securitization in a particular asset class, Reg AB suggests providing the same information by vintage origination years. Reg AB requires, among other things, that issuers provide static pool information, where material, regarding delinquencies, cumulative losses and prepayments for prior securitized pools of an asset type.
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