"Securitization Provisions of the Dodd-Frank Act"

On July 21, 2010, President Obama signed into law the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Act").  Certain of the provisions of the Act will significantly affect the securitization industry. In general, the securitization provisions in the Act (i) define asset-backed security, (ii) provide for credit risk retention (i.e., the proverbial "skin in the game") by securitizers and/or originators with certain exceptions, including for issuances backed by qualified residential mortgages, and (iii) provide for disclosures and reporting for asset-backed securities. 

This Stroock Special Bulletin provides an overview of key provisions of the Act that relate to securitizations and some of the implications for securitizations in the future.