DBRS Comments on Extensions of Credit by Federal Reserve Banks
DBRS has commented on the proposal by the Board of Governors of the Federal Reserve System (Board) to establish an objective process for the Federal Reserve Bank of New York (Federal Reserve) to use in deciding which credit ratings to accept in connection with TALF ABS other than CMBS.*
DBRS commends the Federal Reserve for reviewing the way it determines which credit ratings can be used in connection with its various credit facilities. DBRS believes that the Board has devised an objective, prudent and consistent process for determining eligibility of Nationally Recognized Statistical Rating Organizations (NRSROs) and their ratings for purposes of TALF ABS in a manner that also promotes competition.
DBRS urges the Board to continue reviewing its approach to using credit ratings for purposes of its regular discount window loans.
DBRS’s letter to the Board is available on www.dbrs.com under Regulatory Affairs.
DBRS has its headquarters in Toronto, with offices in New York and Chicago, and covers entities worldwide.
Note:
* The proposal encompasses the Term Asset-backed Securities Loan Facility (TALF) for asset-backed securities (ABS) other than commercial mortgage-backed securities (CMBS). The current proposal would not apply to collateral accepted to secure regular discount window loans or to any other Federal Reserve credit facilities.