In the News: NAIPFA to issue loan disclosure guidance in 2013

Posted on Dec 30, 2012

Groups to Issue Bank Loan Disclosure Guidance in Early 2013

 

The Bond Buyer

 

by: JONATHAN HEMMERDINGER
Monday, December 3, 2012

WASHINGTON — A diverse group of associations with ties to the municipal bond market expects to publish a paper early next year that will give state and local governments guidance on how and when to disclose loans they receive directly from banks.

Led by the National Federation of Municipal Analysts, the effort comes amid increased regulatory scrutiny of “bank loans” by the Municipal Securities Rulemaking Board, which urged muni bond issuers in April to voluntarily post information about them on its EMMA system.

Lisa Good, NFMA executive director, said the groups expect to release a draft of the guidance in the first quarter of 2013.

NFMA is working with the American Bankers Association, Bond Dealers of America, the Government Finance Officers Association, the Investment Company Institute, the National Association of Bond Lawyers, the National Association of Health and Educational Facilities Finance Authorities, the National Association of Independent Public Finance Advisors and the Securities Industry and Financial Markets Association. Many of those same associations collaborated on pension disclosure guidance that NABL released in May.

Lisa Washburn, who is heading the effort as co-chair of NFMA’s industry practices committee, said the guidance will provide a framework for issuers and their counsels to use when deciding whether to voluntarily disclose the loans.

Washburn, who is also a managing director at Municipal Market Advisors, said the existence of new bank loans, or loans that restructure existing debt, can be a critical aspect of an issuer’s financial condition and credit assessment.

Read more…