WASHINGTON – The Municipal Securities Rulemaking Board is seeking applicants to replace seven board members whose terms will end Sept. 30 and has emphasized its interest in applicants to represent investors.
The candidates for the three regulated and four public positions should be individuals who are knowledgeable about the municipal market and want to help craft policies on the regulation of financial professionals, market structure, EMMA, and other topics, according to the MSRB's release announcing its search. They will have until Feb. 19 to submit their applications.
The specific request for investor applicants follows an ill-fated MSRB proposal to loosen the independence standard for the board's public investor representative. The board pulled that proposal after Securities and Exchange Commission Investor Advocate Rick Fleming said it was deeply flawed. The MSRB has since created a seven-member investor advisory group that will serve through Sept. 30.
The MSRB's 21-member board has 11 public and 10 regulated members. The 11 public members must be independent of any muni broker-dealers, banks or advisors. They also must include at least one representative of issuers and one of investors. The 10 regulated representatives must include at least one from a non-bank securities broker dealer and one from a bank broker-dealer. In addition, at least one but not less than 30% of the 10 must be associated with non-dealer or non-bank muni advisors.
The seven chosen for the MSRB's fiscal year 2017 will serve three-year terms starting Oct. 1, according to the release. However, the MSRB has floated a proposal that would change board member terms to four years. While no changes are in place yet, the new members' terms could be affected if the proposal is approved by the SEC.
After the MSRB receives individuals' applications, its nominating and governance committee will review them and select candidates to interview. The committee will then nominate seven candidates that the full board can vote to approve in the fourth quarter of its fiscal year, according to the notice.
The MSRB's last call for board applicants drew only 78 responses, a large decline from the previous three years when the number ranged between 120 and 180.
The seven members who are to leave the board after Sept. 30 include regulated member and current board chair Nat Singer, senior managing director at Swap Financial Group, as well as Colleen Woodell, the vice chair and a public member who formerly was chief credit officer of global corporate and government ratings for Standard & Poor's.
Other members slated to leave include three public members: Robert Cochran, the co-managing director and chairman of the board for Build America Mutual Assurance Company; Lakshmi Kommi, San Diego's director of debt management, and; Chris Ryon, managing director of New Mexico-based Thornburg Investment Management, who represents investors. The regulated members who will be leaving are James McKinney, senior advisor with Chicago's William Blair & Company and Brian Wynne, Morgan Stanley's co-head of public finance and head of the company's municipal syndicate desk.
