Archived Submissions | 2011


Submissions to Australian policy and regulatory agencies

ASF makes detailed plea to APRA to defer introduction of capital deduction for first 10% of capital structure of any securitisation held by ADIs

Following a robust working group process, the ASF has asked APRA to permit it and the industry time to perform a quantitative impact analysis.

The reasons for this are set out in a letter to APRA in response to Chapter 3 of its Discussion Paper entitled Covered bond and securitisation matters. In it, APRA proposed to require ADIs to deduct from their core Tier 1 regulatory capital the nominal value of any holdings of securitisations (including warehouses) that sit within the first 10% of a securitisation’s capital structure. ASF explained that this would have significant impacts on the market and liquidity for AAA RMBS notes, such as so-called AB notes, as well as other securitisations such as ABS and CMBS, which would all react differently and undesirably to such a fixed percentage, and certainly one as high as 10%.

The ASF will continue working with APRA in relation to a number of legacy issues associated with APS120, following the support from Allen & Overy in leading a working group covering such matters.


ASF major bank members provide APRA with technical feedback on its proposed prudential framework for covered bonds

All four major bank ASF members plus their legal advisers set out a comprehensive response to APRA’s proposed covered bond prudential framework, which once settled will become APS121. Thanks to Mallesons Stephen Jaques for leading the working group.


Tax Forum

October 2011

Sticking with the Canberra theme, ASF submitted to the Tax Forum its position on tax reform, most notably we communicated the ASF's view that the Government should commit to introduce the key recommendations of the Henry Tax Review and we suggested a new advisory board should be established to oversee ongoing reform of the tax system to promote tax efficiency. We submitted that it is our view that asset-backed and fixed income securities should be treated equally with other interest bearing investments such as term deposits by the tax system Thanks to Deloitte for its assistance in putting together the submission. The following information is now available on the Future Tax website:


Stamp Duty update

October 2011

Following success in South Australia in getting an administrative arrangement recommended to The S.A. Treasurer in relation to PPSR and RMBS, our attentions have now moved to Queensland. Members will be aware that a special provision was crafted for RMBS issuance backed by Queensland collateral. We have requested that this be extended to covered bonds too. Thanks to Clayton Utz for its assistance in putting together the submissions.


Stamp Duty

August 2011

In addition to representations made by ASF to the South Australian Office of Revenue in relation to the Personal Property Securities Act (PPSA)and General Anti-avoidance (GAA) matters vis-à-vis RMBS, we have - through the good offices of John Loxton of Clayton Utz and Stuart Courtney of Mallesons Stephen Jaques- sent further representations to SA Revenue and the Treasury in Queensland to ensure covered bonds are not overlooked. The GAA matter was successfully resolved and will provide certainty to issuers with South Australian collateral.


ASF half-way there with South Australian Stamp Duty securitisation issues

July 2011

Through the untiring of efforts of John Loxton at Clayton Utz, ASF has secured an in-writing confirmation that the General Anti-Avoidance provisions that commenced 1st July 2011 will not apply to securitisations adopting Clayton’s Contracts. We are continuing to work with the Commission of State Taxation on the broader PPSA issues arising but are hopeful of a pragmatic outcome.


ASF submission to Senate Economics References Inquiry into Competition within the Australian Banking Sector

June 2011

We were pleased to see that many of the views ASF submitted to the Senate Economics References Committee into Competition within the Australian Banking Sector were picked up and included in the Recommendations of the Committee.


ASF submission on financial sector legislation amendment (Prudential refinements and other measures)

March 2011

The ASF's Chairman, Stuart Fuller, in conjunction with the ASF's Covered Bond Working Group lodged a submission to The Treasury's recent Exposure Draft in a bid to include in it measures to allow APRA to administer a covered bond regime in Australia.


Basel II Enhancements transposed by APRA give cause for concern

March 2011

The ASF has made through its Regulatory sub-committee a submission to APRA on its proposed implementation to the enhancement to Basel II proposed by the Basel Committee on Banking Supervision. In summary, the concerns relate to an apparent bid by APRA to interpret certain proposals beyond those that the industry feels Basel intended. For example, should APRA determine that implicit support has been granted to one securitisation transaction, it can unilaterally deem all others similarly vulnerable to such claimed support. Another example relates to the interposing of an additional SPV, purely for mechanistic funding purposes, which APRA seeks to classify as constituting a re-securitisation which in the ASF's view it is not, either in intent or reality. ASF will be meeting APRA on 30th March 2010 to discuss these concerns and broader concerns raised in the ASF CEO's letter to APRA EGM, Charles Littrell, in relation to supervisory interpretation, consistency and grandfathering.


APS210

March 2011

Along with numerous other banking sector stakeholders, the ASF made a forceful submission to APRA on its proposals for implementing the Basel Committee on Banking Supervision's (BCBS) liquidity rules. This included pleading for RMBS and covered bonds to be accepted as eligible liquidity - but with a haircut and cap on holdings eligible - on the grounds that such assets are generally extremely high credit quality and as such have tended to be accepted as repo collateral by central banks for cash liquidity in return. We also noted that the liquid qualities of assets deteriorates significantly the moment a regulator prohibits their eligibility.


ASF Guidance Note 2011-01: National Consumer Credit Protection Act 2009 (Cth)

March 2011

Read the ASF Guidance Note 2011-01: National Consumer Credit Protection Act 2009 (Cth)


ASF lodges its submission to The Treasury on its GST grouping amendments consultation

February 2011

The ASF has made a submission to The Treasury on its GST grouping amendments consultation. Especial thanks go out to Matthew Cridland of KPMG for leading this piece of work.


ASF submission to Senate Economics References Inquiry into Competition within the Australian Banking Sector

February 2011

We were pleased to see that many of the views ASF submitted to the Senate Economics References Committee into Competition within the Australian Banking Sector were picked up and included in the Recommendations of the Committee.


ASF lodges its Securitisation White Paper to The Treasury in relation to The Treasurers December banking competition package

February 2011

The ASF has submitted its Securitisation White Paper to The Treasury in relation to The Treasurers December banking competition package. The recommendations address the $4bn and remaining investment monies; future role of the AOFM in RMBS; and the best means by which the market can through various government agencies support itself medium- to long-term.


ASF lodges a submission on the South Australian Stamp Duties Act 1923

February 2011

The Australian Securitisation Forum lodged a submission on the South Australian Stamp Duties Act 1923.

 

Submissions to overseas policy and regulatory agencies

SEC Responds to ASF Submission

October 2011

The SEC contacted the ASF following our submission earlier this year on the proposed US regulations arising from the Dodd-Frank legislation addressing risk retention in securitisations offered to US persons. The SEC indicated its interest to meet with the ASF to discuss our suggestion to include flexibility in regulations to deal with securitisation by non-US issuers offered in the US capital markets. The ASF is arranging for our advisors, Mayer Brown, to meet with the SEC in Washington with members of the ASF Regulatory & Prudential subcommittee to join the meeting via video conference.


ASF submission on US Risk Retention Policy

August 2011

The Australian Securitisation Forum has made a submission to the SEC and other US banking regulators on the proposed rules for retention of risk in securitization transactions offered to US investors. The essence of our submission is to seek to have the current rules include the flexibility for one US regulatory agency (or behalf of all) have the flexibility to exempt transactions from certain jurisdictions where the US regulators consider the local regulation with respect to risk retention to be equivalent to the US rules. The ASF thanks Mayer Brown for its assistance in compiling this submission.


ASF submits request to SEC for exemption from Rules 17g-5 and 17g-7

August 2011

The ASF has joined the American Securitization Forum to send a letter to the SEC to reiterate our previous joint request that Rules 17g-5 and 17g-7 be amended so that they only apply to transactions rated by NRSROs that are offered to US investors. Rule 17g-5 requires issuers of ABS, including RMBS, to submit deal information to allow other NRSRO designated rating agencies to issue unsolicited ratings. Rule 17g-7 requires rating agencies to comment on the scope and similarity of representations and warranties given by the seller of assets in an ABS transactions. The ASF believes the extraterritorial scope of these rules is inappropriate and represents a burden on the objective of supporting the recovery of securitisation markets.


Rules 17g-5 and Rule 17g-7 - Joint submission

The ASF together with the American Securitization Forum has submitted a letter to the SEC reiterating our previous request for permanent exemption to be granted from Rules 17g-5 and Rule 17g-7 for transactions rated by NRSRO designated credit rating agencies when securities are not offered to US investors. Rule 17g-5 requires ABS (incl RMBS) issuers to disclosure deal information to other NRSRO’s to facilitate unsolicited ratings. Rule 17g-5 requires credit rating agencies to comment in rating reports on the representations and warranties given by the seller of securitised assets.


Credit Risk Retention - ASF letter to SEC

July 2011

The Australian Securitisation Forum has made a submission to the SEC and other US banking regulators on the proposed rules for retention of risk in securitization transactions offered to US investors. The essence of our submission is to seek to have the current rules include the flexibility for one US regulatory agency (or behalf of all) have the flexibility to exempt transactions from certain jurisdictions where the US regulators consider the local regulation with respect to risk retention to be equivalent to the US rules. Attached is the full submission. The ASF thanks Mayer Brown for its assistance in compiling this submission.

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