MSRB to Put Revised MA Proposal Back Out for Comment

WASHINGTON — The Municipal Securities Rulemaking Board will re-propose a revised draft Rule G-42 on the duties of non-solicitor advisors, MSRB officials confirmed Tuesday.

MSRB executive director Lynnette Kelly said the board will definitely put G-42 back out for a 30-day comment period later this month because it has been changed enough from the original proposal to warrant another look from market participants.

The proposed rule caused extreme concern among bankers, who said its ban on MAs engaging as a principal in any other transaction with a client would prevent banks from providing traditional banking services to municipalities for whom they are serving as MAs. Non-dealer MAs have said a principal transaction ban is appropriate.

MSRB chairman Dan Heimowitz said in May that those comments were a "major" topic of discussion at the board's meeting in Alexandria, Va. several weeks ago.

Kelly said that the new draft includes changes on more than one aspect of the original.

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Law and regulation
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