Beginning in 2011, the Municipal Securities Rulemaking Board (MSRB) began raising market awareness with respect to voluntary disclosure of bank loans on the Electronic Municipal Market Access (EMMA) website1 and in 2012 encouraged state and local governments to post bank loan information on a voluntary basis on the EMMA website.2 This awareness and concern was mirrored by rating agencies such as Standard and Poor's (S&P), which mandated that all issuers of S&P-rated bonds provide S&P with all relevant documentation related to any private debt, including bank loans assumed by such issuers.3
The MSRB has now updated procedures for the EMMA website, enabling "state and local governments to make information about their bank loan financings and other debt-like obligations publicly available to investors or others."4 These updated procedures standardize the method of posting voluntary disclosures. This clarification comes after many issuers previously disclosed such information in an inconsistent manner, such as by a Material Event Disclosure.
Issuers now should make such disclosures by following these steps:5
Go to the EMMA website and click on the EMMA Dataport link in the upper right corner of the website.
Any issuer considering voluntary bank loan disclosure on EMMA or with questions may wish to consult with counsel prior to any disclosure. The attorneys in Day Pitney's Municipal Finance Group routinely counsel clients on such matters. Please feel free to contact any of the attorneys listed on the right of this advisory if you would like to discuss this advisory or your disclosure obligations.
1 See MSRB Notice 2011-52 (September 12, 2011), "Potential Applicability of MSRB Rules to Certain 'Direct Purchases' and 'Bank Loans'"; MSRB Notice 2012-18 (April 3, 2012), "Notice Concerning Voluntary Disclosure of Bank Loans to EMMA®"; and MSRB Notice 2015-03 (January 29, 2015), "Bank Loan Disclosure Market Advisory."
2 MSRB, "Municipal Market Disclosure" (last visited August 28, 2015).
3 Namita Shah, "Disclose Bank Loans to Standard & Poor's or Risk Rating Withdrawal," Day Pitney Municipal Finance Client Alert, May 21, 2014.
4 MSRB, State and Local Government Toolkit, "Posting Bank Loan Disclosures on EMMA®."
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