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On September 26, 2025, the Securities and Exchange Commission (the "Commission") issued a concept release to gather public comments on potential changes to its rules for asset-backed securities ("ABS"). The release focuses particularly on residential mortgage-backed securities ("RMBS").
The Commission's action is in response to the fact that there have been no registered RMBS offerings since the adoption of Regulation AB II in 2014, with all activity instead occurring in the registration-exempt private market, largely pursuant to Rule 144A of the Securities Act of 1933 ("Rule 144A").
Across 39 questions covering three primary topics, the concept release examines and requests public comment on whether changes should be made to the current rules in order to "revive the public RMBS market" and "make securitization great again". This sentiment comes on the heels of an estimated $1.6 trillion in mortgage-backed securities issuances last year, according to the Securities Industry and Financial Markets Association, and with a stated goal of encouraging public RMBS offerings and increasing liquidity in the registered RMBS market.
Asset-Level Disclosures for RMBS
The concept release questions whether the asset-level disclosure requirements for issuers of public RMBS are prohibitively onerous. Item 1125 of Regulation AB requires public issuers to provide detailed, standardized asset-level data about each loan within the RMBS pool – up to 270 different data points for each underlying mortgage.
One proposal the release contemplates is the removal of certain RMBS-specific asset-level data points to bring the public requirement more in line with the loan-level disclosures typically provided in the Rule 144A RMBS market, which the proposal suggests may help issuers bridge the gap between the private and public RMBS markets.
Disclosure of Certain Sensitive RMBS Asset-Level Data
Even if RMBS issuers can meet the operational and financial challenges of the extensive data collection and validation required under Item 1125, the granularity of such asset-level disclosure continues to raise significant privacy concerns. The concept release recognizes the need to balance the goal of providing investors with sufficient material information about the underlying loans with the need to protect the privacy of individual borrowers.
In response, the Commission is reconsidering the use of issuer-sponsored websites for hosting asset-level data, an idea that was floated in connection with Regulation AB II but ultimately excluded from the final rule after pushback by market participants. In addition to revisiting the website proposal, the Commission seeks alternative approaches.
Definition of "Asset-Backed Security"
The concept release further considers the merits of aligning the definition of "asset-backed security" in Regulation AB with the definition of the same found in Section 3(a)(79) of the Securities Exchange Act of 1934. The Exchange Act definition, which is broader and more inclusive, may be the more fitting definition given the evolving innovation and diversity of asset structures and classes, posits the Commission. The concept release suggests that harmonizing the definition of "asset-backed security" – and potentially other terms, including "issuer", "depositor" and "sponsor" – between the two regulatory standards could remove confusion and provide greater flexibility for ABS issuers.
Next Steps
The Commission is soliciting public comments on the concept release for 60 days. In addition to the topics explicitly covered in the publication, the Commission has put out a general call for feedback and suggestions related to any aspect of ABS regulations.
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