FDIC proposes to relax disclosure requirements under Securitization Safe Harbor Rule
On July 16, the FDIC approved a proposal revising certain provisions of the Securitization Safe Harbor Rule (rule). The current rule mandates that documents governing a securitization must disclose information regarding the securitized financial assets on a financial asset or pool level and on a security level that, at minimum, complies with Regulation AB, whether or not the transaction is an issuance covered by the regulation. The proposal would eliminate the requirement that securitization documents comply with Regulation AB, where Regulation AB by its terms would not apply to the issuing transaction. According to a statement by Chairwoman, Jelena McWilliams, the proposal “would remove one potential obstacle that [insured depository institutions] face in providing mortgage credit to homeowners.” FDIC Director Gruenberg dissented from the approval of the proposal.
Comments on the proposal will be due within 60 days after publication of the proposal in the Federal Register.