Bank of America Corp., Citigroup Inc. and Morgan Stanley are among more than 20 companies forming a trade organization after some members defected this month from the existing American Securitization Forum.
The American Securitization Forum, the trade group thrown into turmoil this month after most of its board quit in a dispute with its executive director, took its first public action since the defections, sending a comment letter to the Basel Committee on Banking Supervision.
The U.S. financial-regulation bill may halt the already diminished market for asset-backed securities by increasing liability risk for credit raters, a securitization-industry group and bank analysts said.
U.S. regulators should exempt securitization vehicles from Dodd-Frank Act rules slated to take effect this year to avoid hampering the market for asset-backed securities, according to an industry lobby group.
Some struggling homeowners left out of current U.S. government mortgage-aid programs because their home loans have been packaged into private securities could see their interest rates cut through a subsidy being considered by the Treasury Department.
The U.S. overseer of Fannie Mae and Freddie Mac, planning for when the companies are eliminated or their role diminished, is seeking input on a system to standardize the packaging of home loans into securities.