• Summary and Analysis of the Effect of the Dodd-Frank Wall Street Reform and Consumer Protection Act on the Securitization Industry
  • August 23, 2010
  • Law Firm: SNR Denton - Chicago Office
  • On June 30, 2010, the U.S. House of Representatives passed the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Act”) and on July 15, 2010, the United States Senate followed suit. President Obama signed the Act into law on July 21, 2010. The Act contains numerous provisions that will have far reaching effects on the securitization industry, most notably by instituting requirements relating to risk retention and by establishing new rules governing the regulation of credit rating agencies and the procedure for obtaining ratings of securities. Major industry groups, such as the American Securitization Forum and the CRE Finance Council, were successful in convincing Congress to implement a significant number, but by no means all, of their preferred provisions. The Act is highly deferential to regulatory agencies, and therefore the effect of significant portions of the legislation will be delayed and will be highly dependent upon the rules eventually promulgated by federal regulators. Industry participants will likely be heavily engaged with the regulators over the course of the coming months and years in an effort to influence the content of the implementing regulations.