RBA changes reporting standards on mortgage-backed securities
(24 October 2012 – Australia) Industry-wide reporting standards for mortgage-backed securities are being introduced by the Reserve Bank of Australia (RBA).
The new standards will allow investors to compare the performance of mortgage-backed securities on a like-for-like basis for the first time and comes in the aftermath of the global financial crisis, which crushed the volume of new issuance.
The transition period begins early next year and any issuers that have not conformed to the new reporting standard will have their securities become ineligible for the central bank's repurchase agreements (repos) program.
The RBA uses repos to manage the amount of cash in the banking system and sometimes to support markets, including the market for residential mortgage-backed securities (RMBS).
RBA assistant governor financial markets, Guy Debelle, said the data, to be reported quarterly, would benefit the broader market by providing more transparency to Australian RMBS.
'The Reserve Bank will also require that issuers make these reporting templates available to the public, free of charge,' Dr Debelle told the Australian Securitisation Forum in Sydney on Monday.
'Issuers will have to inform the Reserve Bank of where their data are being stored and being made available to the public.
'It will also be a requirement that issuers ensure that these data are accurate.'
The details of the information to be required at least each quarter on both existing and new RMBS will be set out in reporting templates, to be made available on the RBA website.
Debelle said the new standards would help the RBA to more precisely value the securities held on its balance sheet in terms of both price and risk.
They would also decrease the RBA's reliance on credit rating agencies in assessing the securities.
The transition period begins early next year and any issuers that have not conformed to the new reporting standard will have their securities become ineligible for the central bank's repurchase agreements (repos) program.
The RBA uses repos to manage the amount of cash in the banking system and sometimes to support markets, including the market for residential mortgage-backed securities (RMBS).
RBA assistant governor financial markets, Guy Debelle, said the data, to be reported quarterly, would benefit the broader market by providing more transparency to Australian RMBS.
'The Reserve Bank will also require that issuers make these reporting templates available to the public, free of charge,' Dr Debelle told the Australian Securitisation Forum in Sydney on Monday.
'Issuers will have to inform the Reserve Bank of where their data are being stored and being made available to the public.
'It will also be a requirement that issuers ensure that these data are accurate.'
The details of the information to be required at least each quarter on both existing and new RMBS will be set out in reporting templates, to be made available on the RBA website.
Debelle said the new standards would help the RBA to more precisely value the securities held on its balance sheet in terms of both price and risk.
They would also decrease the RBA's reliance on credit rating agencies in assessing the securities.
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