Reuters: Regulatory News: Municipal buyers can now see inter-dealer yields

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Municipal buyers can now see inter-dealer yields May 1st 2012, 16:18 Tue May 1, 2012 12:18pm EDT May 1 (Reuters) - Investors in municipal bonds can now see yields on transactions between dealers in yet another step to make the $3.7 trillion market more transparent. The Municipal Securities Rulemaking Board (MSRB) said on Tuesday it has begun to post the inter-dealer yields and prices on the public database it operates, a website known as EMMA for Electronic Municipal Market Access. The board, a self-regulatory organization that writes rules for the market that the Securities and Exchange Commission enforces, said that last year inter-dealer trades made up about one-third of municipal transactions. In March, the SEC said the recent financial struggles of states and cities were creating the need for better disclosures and record-keeping in the municipal bond market. For the last few years, the federal government has ramped up investor protections in the market, an effort that accelerated with the passage of the financial regulatory overhaul known as the Dodd-Frank Act. The MSRB also noted that investors can receive emails notifying them when a particular security trades. The biggest regulatory change -- defining who counts as an adviser to issuers under Dodd-Frank -- has yet to be made. SEC Chairman Mary Schapiro said last week that the final definition would be scaled back from the original proposal. Many, including the MSRB, had said it would unintentionally put those who do not truly advise issuers under federal scrutiny. Specifically, Schapiro said the exclusion of municipal employees from requirements to register as advisers needed to extend to those who are appointed to positions, so as not to discourage volunteerism by citizens. "This is an area where we can make some reasonable carvebacks without doing damage to the goal of municipal adviser registration," Schapiro said. The market had expected the definition to be finalized earlier this year. Link this Share this Digg this Email Reprints

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