|Thursday, July 29, 1999
NASD Board Approves a Bond Trade Reporting and Transaction Dissemination Facility
Washington, D.C.—The National Association of Securities Dealers, Inc. (NASD®), today announced that its Board has approved the establishment of a trade reporting and transaction dissemination facility for corporate bonds. The proposal was developed in response to Securities and Exchange Commission (SEC) Chairman Arthur Levitt’s call for increased bond market transparency. It is designed to enhance the price transparency and surveillance of the U.S. corporate debt market and will be submitted to the SEC for final approval.
If implemented, NASD members will begin reporting in spring of 2000 all transactions involving specified U.S. corporate bonds. Initially, transactions will be sent to a reporting system within one hour of execution. Six months after the facility is introduced, the time frame will be compressed and the NASD will commence dissemination of the transactions to the public.
"We believe the proposal will greatly enhance the transparency of the market," said J. Patrick Campbell, Chief Operating Officer and Executive Vice President of The Nasdaq-Amex Market Group, Inc., a subsidiary of the NASD. "Full implementation will ensure that investors and other participants will have the information that will increase confidence in the corporate bond market."
The proposal is the result of a collaborative effort by the NASD and the Bond Market Transparency Committee, a blue ribbon panel of bond industry experts that included institutional investors, retail and institutional broker/dealers, inter-dealer brokers, an academic and industry representatives from the Bond Market Association, the American Association of Individual Investors and the Securities Industry Association.
The plan will be implemented in two phases. The following are highlights of Phase I, which address regulatory reporting and surveillance requirements for debt securities:
The National Association of Securities Dealers, Inc. (NASD), is the largest securities-industry, self-regulatory organization in the United States. It is the parent organization of The Nasdaq-Amex Market Group, Inc., and NASD Regulation, Inc. Through The Nasdaq-Amex Market Group SM, the NASD operates The Nasdaq Stock Market® and the American Stock Exchange®. Through its regulatory subsidiary, the NASD develops rules and regulations, provides a dispute resolution forum, and conducts regulatory reviews of member activities for the protection and benefit of investors. The NASD oversees the nation’s 5,600 brokerage firms and more than 600,000 registered brokers. For more information about the NASD and its subsidiaries, please visit the following Web sites: www.nasd.com; www.nasdaq-amex.com; or the Nasdaq-Amex NewsroomSM at www.nasdaq-amexnews.com.