The Financial Industry Regulatory Authority (FINRA) issued a trade reporting notice today regarding when to report ABS to the Trade Reporting and Compliance Engine (TRACE).
The FINRA requested that firms report ABS deals as soon as possible after a transaction is executed and throughout the trading date. This is despite firms actually having up to two business days to report these transactions under TRACE transaction reporting rules effective on May 16.
Initially, FINRA made a proposal that firms report ABS deals no later than the close of the TRACE System on the date of the trade, although with certain exceptions.
However, responding to concerns about the difficulties of submitting deal information on more complex ABS transactions, FINRA proposed and the Securities and Exchange Commission approved a Pilot Program. This program allows more time for reporting such ABS offerings to TRACE in the first six months of reporting, giving firms more flexibility or an additional day for timely reporting.
Specifically, during the Pilot Program, FINRA Rule 6730 allows ABS deals executed on a business day to be reported no later than the next business day during TRACE system hours.
But, when the Pilot Program expires, most ABS deals must then be reported the day of execution during TRACE system hours to be timely.
For a full copy of the notice, please click on this link.