WASHINGTON – The Municipal Securities Rulemaking Board is opening an application window between May 3 and May 10 to allow more individuals associated with banks and broker-dealers to apply for a seat on next year's board.
Any applicants who choose to submit during this period will join others who did so when the MSRB first called for applications in January. Those earlier applicants are still under consideration, the MSRB said in its release announcing the window. Applicants from either round of submissions selected for board seats will begin their terms on Oct. 1, 2016, the first day of the MSRB's fiscal year 2017.
The self-regulator said it is specifically looking for a wider pool of individuals from banks and broker-dealers with sales and trading desk experience, including pricing and trading of municipal securities, determinations of prevailing market price, and markup policies, as well as an understanding of syndicate practices.
"The board has identified the need for this expertise in light of the MSRB's strategic plan and ongoing initiatives, which include a new best execution rule, development of prevailing market price guidance and markup disclosure requirements, and an analysis of pre-trade data with the potential to make some of it publicly available on [EMMA]," the MSRB said in the release. "The MSRB's goal is to ensure the necessary skill-sets are present on the board to support advancement of the organization's agenda and to further inform market structure and transparency."
The MSRB will only choose six applicants for its 21-member, majority public board this year instead of the normal seven. The change comes after the Securities and Exchange Commission recently approved an MSRB proposal to extend board member terms to four years from three. The change is meant to increase the level of expertise on the board at any given point in time.
The board is required to have a majority of public members as well as a certain number of members representing various areas of the municipal industry. There are 11 public members that represent investors, municipal entities, and other non-MSRB regulated individuals. The 10 regulated members represent broker-dealers, bank dealers, and municipal advisors.
Board members currently serve staggered three-year terms with a new "class" of seven members joining the board every fiscal year. The classes are named for the year in which the members are scheduled to leave the board. Under the approved changes, the MSRB will now have four classes, three of which will have five members and one of which will have six.
The transition to the new structure is scheduled to take place between fiscal years 2017 and 2020, at which point five new members will be selected. After that, new classes will be named annually in a repeating sequence of six members, then five members, then five members, then five members.
