The Canadian Securities Administrators say they are planning to propose reforms to the regulation of securitized products and credit rating agencies later this year.

In a staff notice published on Friday, the CSA says that it is working on regulatory proposals concerning securitized products, including asset-backed commercial paper and asset-backed securities.

It reports that CSA staff have been considering changes to the current approach to the issuance of securitized products in the exempt market.

“In addition to reconsidering the use of the short-term debt exemption for the distribution of ABCP, we have been considering whether to impose other conditions in connection with the exempt distribution of securitized products, including requiring disclosure,” it notes.

The CSA says that it is also considering changes to the disclosure requirements for securitized products distributed by prospectus, and it is considering proposals for more tailored continuous disclosure for reporting issuers that have distributed securitized products.

“Our proposals will be designed to address investor protection and market stability concerns, taking into consideration international developments, while recognizing the importance of the securitization markets. We appreciate that some of these proposals could be significant policy changes,” it says, adding that to obtain market input on these issues, the regulators plan to publish materials for comment in the fall.

In addition to the securitization proposals, the CSA also expects to publish proposals relating to regulation of credit rating organizations in the summer, it adds.

IE