The Securities and Exchange Commission will no longer vote on Regulation AB II at its open meeting scheduled for February 5, 2014, according to a notice published today.
Securitization industry will now have to wait and see where the banking regulators stand on the revised disclosure requirements. The SEC did not say when it would reschedule its vote.
Last week ASR reported that the SEC planned to vote on revisions to the rules that are designed to give investors enough information about asset-backed securities to understand them and value them correctly, reducing reliance on ratings agencies, and to better align the interests of sponsors and investors.
The revisions to Regulation AB, which were first proposed in 2010 and then re-proposed in 2011, would require asset-backed issuers to provide enhanced disclosures, including information for certain asset classes about each asset in the underlying pool in a standardized, tagged format and to revise the shelf offering process and eligibility criteria for asset-backed securities.
One of the most controversial proposals would require issuers to prepare and disclose, in addition to the pool-level data they already provide, a voluminous amount of information for every asset in the underlying pool.
Issuers would be required to create and file an interactive payment waterfall computer program that would allow investors to vary underlying pool performance assumptions, in order to better understand the allocation of cash flows in the ABS transaction.