IOSCO Publishes Ongoing ABS Disclosure Principles

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Today the board of the International Organization of Securities Commissions (IOSCO) published the final report on Principles for Ongoing Disclosure for Asset Backed Securities, which contains principles made to give guidance to securities regulators who are developing their regulatory regimes for ongoing ABS disclosures, according to a release from IOSCO.

The report's objective is to enhance investor protection by offering a better understanding of the issues that should be considered by regulators related to ongoing ABS regime disclosures.

The eleven principles from the report were developed as a complement to commission’s Disclosure Principles for Public Offerings and Listings of Asset-Backed Securities, issued in 2010.

The IOSCO has also issued disclosure principles that offer guidance for cross-border offerings of equity securities (1998); ongoing disclosure of material development reporting (2002); management’s discussion and analysis (2003); cross-border offerings of debt securities (2007); and periodic disclosure (2010).

The ABS Ongoing Disclosure Principles suggested disclosures for securities that are mainly serviced by the cash flows of a discrete pool of receivables or other financial assets - either fixed or revolving - that by their terms convert into cash within a finite time period.

These principles would not apply to securities backed by asset pools that are actively managed, such as securities issued by investment companies or collateralized debt obligations, or that contain assets that do not by their terms convert to cash.

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