FDIC Issues Proposal to Revise Securitization Safe Harbor Rule

The FDIC today said it would issue a notice of proposed rulemaking to amend its securitization safe harbor rule, which addresses circumstances that may arise if the FDIC is appointed receiver or conservator for an insured depository institution that has sponsored one or more securitization transactions.

The proposal would remove from the rule a disclosure requirement that documents governing securitizations transactions be compliant with the Securities and Exchange Commission’s Regulation AB in order to be afforded safe harbor treatment by the FDIC. The proposed rule is meant to ease the reporting and disclosure requirements imposed by Reg AB to encourage certain mortgage backed securitizations.

“The proposal we are considering today would remove one potential obstacle that IDIs face in providing mortgage credit to homeowners,” noted FDIC Chairman Jelena McWilliams. Comments on the proposal will be due 60 days after publication in the Federal Register.