ASIC flags more surveillance next year

The Australian Securities and Investments Commission (ASIC) has flagged that it intends undertaking a surveillance project around Residential Mortgage Backed Securities (RMBS) disclosure standards next year.

The surveillance project has been flagged by ASIC chairman Greg Medcraft, who told an Australian Securitisation Forum conference that both the regulator and Treasury were also considering the merits of providing regulatory backing for current industry standards.

Medcraft noted that new RMBS disclosure standards will come into effect from 1 January next year, and said ASIC would undertake a surveillance project to assess the uptake of the industry standards.

"Ultimately, these reforms are aimed at improving investor confidence in securitisation markets and this is in line with ASIC's first key outcome of confident and informed investors and financial consumers," he said.

The ASIC chairman said that while the regulator and the Treasury were considering the policy merits of providing regulatory backing to the changes, this would represent a departure from the current policy approach in the Corporations Law of focusing the disclosure regime on retail investors.

"Currently, there is no disclosure regime for financial products (such as RMBS and covered bonds) that are issued to wholesale investors," he said. "However, we note that in other major securitisation markets, prescriptive disclosure requirements are being considered."