WASHINGTON -- Bloomberg Financial Markets has become the first information vendor to pledge to become a national municipal securities repository under the Securities and Exchange Commission's proposed disclosure rules.

"In the event that the SEC adopts the new standards set forth in the release for NRMSIRS, Bloomberg ... is both willing and able to meet such standards," said Michael R. Bloomberg, president of the firm, in a twopage letter to the SEC.

Bloomberg's letter came in response to the SEC's March 16 request for comments on a proposed rule that would bar dealers from underwriting bonds unless an issuer has pledged in writing to provide ongoing disclosure to a nationally recognized municipal securities information repository.

Comments are due Friday on the proposed rule, as well as on an SEC legal interpretation that discusses the disclosure responsibilities of issuers, dealers, and other market participants. The legal interpretation also was published for comment March 16.

Bloomberg's announcement is significant because implementation of the SEC's proposed rule hinges on having sophisticated repositories in place that can take in reams of audited financial statements and other reports from hundreds of thousands of issuers nationwide and make them available electronically to dealers, analysts, and other subscribers.

Currently, Bloomberg is one of three private vendors that are recognized by the SEC as national repositories for official statements. But before the firms, which also include J.J. Kenny Co., Standard & Poor's Corp., and The Bond Buyer, could take in new documents under the SEC's new disclosure rules, they would have to requalify.

Taking on the SEC's proposed system would be daunting, since the agency, in an effort to avoid dictating form and content to issuers, is not restricting the amount of paper that issuers can submit.

"Nobody knows" what the paperwork is going to be, said John Aubert, vice president of data research at Bloomberg. "It's like saying, 'We're going to go to the moon, but we're not sure what we are going to find.' It's certainly possible that we [have] misgauged." But the rule is likely to be implemented gradually, so Bloomberg will have lead time, he said.

"We feel we can do it. We are quite willing to make the adjustment [and] the investment. Mike Bloomberg is very willing to step up and do the undoable. Somehow we have managed to find the resources" so far, Aubert said.

"I don't think this is going to be any different," he said.

Joyce Smith, vice president for municipal information products at The Bond Buyer, said yesterday that the firm has not yet decided whether to become a national repository under the proposed system.

"The Bond Buyer has proven its ability to meet all requirements of a NRMSIR under current regulations," Smith said.

A spokesperson for J.J. Kenny could not be reached for comment.

Meanwhile, a municipal disclosure panel made up of state officials yesterday called for creation of a twostep system of disclosure in which state and local government repositories would collect information from issuers and national repositories and information vendors would distribute it.

The National Advisory Board on State and Local Government Secondary Market Disclosure, which was established in 1993 to help states develop their own repositories, made the recommendation in a 22-page report to state governments. The panel is sponsored by the National Association of State Auditors, Comptrollers and Treasurers, which opposes establishment of a single national repository for bond documents

"States are best equipped to collect information, so let them collect it," said Harvey Eckert, deputy secretary for comptroller operations in Pennsylvania, who is chairman of the national advisory board. "Given the profit motive, the NRMSIRs are best equipped to add value to it and to format it for their customers, so leave the distribution to them."

But Bloomberg said in its letter that designating states as national repositories might "discourage, rather than encourage, wider dissemination of issuer information and frustrate or delay current NRMSIR mechanisms for dissemination.

"It is unlikely that the states would have the infrastructure in place to gather, store, retrieve, and disseminate information in the manner" suggested by the SEC, Bloomberg said. "Therefore, designating states as NRMSIRs would likely just add another step to the dissemination process."

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