Forum Spotlight: Issuers
December 11, 2023
Together, Jane, David, and Brigid form the “Leadership Working Group” for the Issuers Forum. Their duties include setting agendas and priorities for the Forum and representing the constituency on CREFC’s Policy Committee.
Why it matters: Each of the Forums interacts and addresses issues critical to their business sector and works to achieve solutions that serve a common purpose. CREFC works closely with Forum leaders and members to:
- Ensure all voices are heard,
- Assist in finding consensus amidst disparate and converging views,
- Sharing those views when appropriate with regulators and legislators, utilizing CREFC’s experienced Government Relations Team,
- Develop new best practices and monitor old ones.
Key Issuer Focus Areas
- Building conduit pools to balance investor preference and borrower demand
- Solving for risk retention amidst lopsided origination volume among sellers
- Managing deal timing given new filing requirements
- Maintaining open dialogue with other market participants to help promote responsible lending, including incorporating feedback on structural and documentation enhancements necessary to improve both the borrower experience and loan performance
- Actively working to increase 10-year loan origination volume, while keeping keep B-piece investors engaged in today’s 5-year CMBS transactions.
Looking ahead: Leaders are concerned about continued lackluster origination volume, the lack of property-type diversification, and regulatory concerns such as the SEC’s Conflict of Interest and the Basel III End Game. That said, the Forum remains focused on sourcing loans and bringing securitizations to market, bridging the demands between borrowers and investors.
Key Policy Issues:
- SEC’s Conflict of Interest in Securitization Rule: On November 27, the SEC published its final rule on Conflicts of Interest in Securitization. CREFC submitted two comment letters on the issue and engaged with lawmakers on Capitol Hill. The final rule included changes that addressed some of CREFC’s concerns such as narrowing the definition of “sponsor” to exclude some service providers, “long-only investors” exercising contractual rights, and allowing certain affiliates to be excluded from the rule.
- SEC Timely Filing Issue: On August 30, SEC staff issued a Compliance and Disclosure Interpretation (CDI) on Reg AB that could be read to require the filing of a final prospectus two business days after the first time of sale, whether or not the final prospectus has been used. The change upends the filing timeline regulations for CMBS. CREFC has been working with members and the SEC to address the issue.
- 15c2-11 Public Disclosure of 144A Bond: The SEC recently issued an order exempting 144A fixed-income securities from 15c2-11 disclosure. CREFC and its members urged the SEC and Congress to take action to prevent the application of 15c2-11 to fixed income securities. The exemption order is a major win for the industry.
What’s Next?
- Forum leaders will present an update on their Forum at the Annual January Conference in Miami.
- Soon after, the chairs will seek nominations for the next Chair-Elect to join their leadership slate.
To join the Issuers Forum, please register here. For any forum related questions, please contact Kathleen Olin (kolin@crefc.org) or Lisa Pendergast (lpendergast@crefc.org).