MSRB Update: Fall 2018

MSRB Update Fall

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The Year Ahead

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The activities and focus of the Municipal Securities Rulemaking Board (MSRB) are guided by its Board of Directors, which meets in person four times a year. In October, the Board held its first meeting of the 2019 fiscal year, under the chairmanship of Gary Hall, where it discussed specific regulatory topics and the MSRB’s priorities for the year. Among those priorities is the retrospective review of MSRB rules to help ensure they continue to achieve their intended purposes and reflect market conditions, and a focus on cloud computing and “big data” to ensure long-term data quality and security of the MSRBs market data and explore its data analysis capabilities.


Stakeholder engagement also is a top priority with the recent formation of advisory groups to expand the MSRB’s access to expert market knowledge, and Board member participation in listening sessions and Town Hall meetings. Additional strategic goals are enhancing the EMMA website for issuers to improve the quality of indexing data for disclosure documents and the document-submission process and interface and continuing a long-term strategy to reduce financial reserves. Read what Chair Hall and Lynnette Kelly, MSRB President and CEO, have to say about these objectives.

MSRB Chair Gary Hall on Bloomberg Television

Gary Bloomberg


MSRB Chair Gary Hall appeared on Bloomberg’s Muni Moment with Taylor Riggs on November 1, 2018. The discussion touched upon MSRB disclosure and transparency efforts and the role of municipal bonds in the context of the national infrastructure funding debate. Watch the full interview here.


Taylor Riggs, Bloomberg Television: First, I want to talk about the MSRB. You just took over as chair in July. A few months on the job, what are you doing so far to increase transparency in an otherwise pretty opaque market?


Gary Hall, MSRB: We just celebrated our tenth anniversary of EMMA, it’s our repository system analogous to EDGAR. On that system, in addition to primary offering documents and continuing disclosure documents, we provide yield curves, a new issuance calendar, indices, and a host of information to help inform investors as they’re making buying and pricing decisions. We’re really opening up the market but were also focused on making sure that our disclosure practices will be compatible for the market down the road.


We’re investing in big data and making sure we contemplate what this market will be like down the road so that we ensure that investors, when making buying and pricing decisions, can have information that is relevant to them. We have to think about how we change the structure of our documents, so that they can be searched through machine learning and artificial intelligence. So, we’re doing a lot Taylor to make our market a little more transparent.


Riggs: I want to quickly talk about the midterms coming up on Tuesday and infrastructure. Anything there that really changes your view?


Hall: Infrastructure is a bipartisan issue. We’re a creature of Congress so we’re agnostic as to who controls Congress. I will tell you that with $2 trillion in infrastructure needs over the next ten years, it’s really important that we focus on this. We hope that the municipal market is a place that we can have some expansive tools. We saw that in the America Recovery Act with the Build America bonds, and we hope that it takes place in this market as well.

Keeping an Eye Out for Retail Investor Risks

Even some market participants may not realize that American households hold $1.63 trillion in municipal securities, representing over 42 percent of outstanding U.S. municipal bond debt. This extensive household ownership of municipal securities requires close monitoring by the MSRB of developments and market practices that may pose a potential risk to retail investors. The MSRB annually communicates with Rick Fleming, Investor Advocate at the U.S. Securities and Exchange Commission (SEC), about retail investor risks that the MSRB sees in the market. This year the MSRB flagged the topics below as top concerns.

  • Potential risks to retail investors that may arise from the convergence of a rising interest rate environment and the potential for financial distress among some municipalities.
  • How and when retail investors learn of important developments related to a municipality, including those that may indicate fiscal distress.
  • Certain market practices, including the role of municipal securities dealers when conducting customer transactions in distressed municipality securities. The MSRB is also monitoring the practice of “pennying,” sometimes also referred to as “last-look,” which may negatively impact prices received by retail investors in municipal bonds; and certain prearranged trading in connection with primary offerings of municipal securities intended to circumvent the priority provisions for allocations of the issuance established by issuers and their underwriters.

Read the MSRB’s 2018 letter to the SEC Investor Advocate.

New Reports and Publications

Budget Summary 2018

Executive Budget Summary
The budget summary for fiscal 2019 aligns with the MSRB’s commitment to transparent and responsible financial management. This year, the MSRB Board of Directors, which develops the budget with senior management, is publicly communicating steps to reduce the organization’s reserve funds. Read the full budget summary.






Analysis of Municipal Securities Pre-Trade Data from Alternative Trading Systems
Market structure experts at the MSRB share their analysis of pre-trade quote data for municipal securities available to market participants on alternative trading systems (ATSs), adding to the literature on pre-trade price transparency. Read the full report.


Read more white papers and reports from the MSRB.

New Educational Resources

The MSRB has developed new educational content to stakeholders over the past quarter, consistent with its mission to enhance municipal market understanding. These resources and many more are available in the MSRB’s online Education Center.



Know Your Protections: Regulation, Information and Resources

This document provides an overview of MSRB rules and resources designed to protect municipal securities investors when buying and selling municipal securities. Read the fact sheet.







Credit Ratings

Credit Rating Basics for Municipal Bond Investors

This fact sheet covers the basics of municipal bond credit ratings as one indicator of the credit quality of an issuer and how they relate to the rating agencies and more. Read the fact sheet.









For Investors: The Basics of a Municipal Bond Issuer’s Audited Financial Reports

This fact sheet helps investors understand the significance of an issuer’s financial condition and performance when considering a purchase or sale of a municipal bond. Read the fact sheet.







Green Bonds

About Green Bonds

Green bonds, a fixed income debt instrument like any other bond, are notable in that they offer a promise to use proceeds to finance or re-finance sustainable projects. This document notes the factors investors should consider when contemplating an investment in green bonds. Read the fact sheet.


Rules and Guidance Roundup

Visit the Rules and Guidance page of to stay up-to-date with the latest requests for comment, proposed rule changes, rule approval notices and market advisories.


Compliance Resources

Visit the online Compliance Center for resources and information to help regulated entities understand and comply with MSRB rules. 


Recent Press Releases

Read the MSRB’s latest press releases on