Speech by SEC Commissioner:
Statement at Open Commission Meeting — Adoption of Final Rules Relating to Security Ratings
Commissioner Kathleen L. Casey
U.S. Securities and Exchange Commission
July 26, 2011
Thank you, Chairman Schapiro, and thanks to the Division of Corporation Finance and the other Divisions and Offices that contributed to the Security Ratings release. Pursuant to Section 939A of the Dodd-Frank Act, the release removes references to credit ratings from certain rules and forms under the Securities Act and the Exchange Act and I support its adoption.
When we proposed amendments to the shelf eligibility criteria in February, we noted that in seeking to eliminate references to, and reduce our reliance on, credit ratings for regulatory purposes, it was also important that we preserved the existing use of shelf registration statements by issuers, as Congress did not intend for Sec. 939A to cause issuers that currently rely on the investment-grade criterion to lose shelf eligibility.
While I believe the identified criteria in the final rule are intended to achieve this, I believe that we must continue to monitor the rule’s use and effectiveness. If it becomes clear that the criteria ultimately operate to be more restrictive than intended, we should revisit and adjust the rule accordingly.
Thanks once again to Meredith and your staff for your good work and for your thoughtful approach to the rules that we are adopting today. I have no questions.