Wednesday, July 21, 2010

Reform bill might halt the ABS market, insiders say

Another unintended consequence of legislation stifling another desperately needed industry.... pushing economic recovery further out into the ether.

Bank analysts and an industry group said regulatory reform legislation heading to President Barack Obama might hurt the asset-backed securities market by bolstering credit raters' liability risk. The major credit rating agencies informed the industry that underwriters will no longer be allowed to use their ratings in bond-registration statements because their risk of being sued has increased. Bloomberg

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