Under the modified proposal, an issuer of mortgage-backed securities would have to provide loan-level information to investors via a website where it could restrict access to sensitive information about borrowers. The original proposal would have required such reporting via the SEC's public website, EDGAR.
The revised proposal raises the question of whether there should there be a special website for investors to access information that the public would not be able to see.
"That may be a good balance between privacy concerns and the need for more loan level disclosure. The other [potential] benefit to it is that the non-EDGAR website may have more investor-friendly functionality," said Tom Deutsch, executive director of the American Securitization Forum, giving what he described as his initial take on the new proposal Tuesday.
The comment period ends March 28.
The rule broadly deals with disclosure, reporting and offering of mortgage-backed and asset-backed securities. The SEC at one point planned to vote on the proposed regulation this month but later pulled the item from its agenda.
Various versions of the proposal, known as Reg AB II, have been in the works since 2010.
"Privacy concerns have been the biggest sticking point for Reg AB II since the beginning," says Deutsch.