FINRA proposed implementing a $5 million dissemination cap for all agency debt securities (i.e., replacing the current $1 million dissemination cap for non-investment grade debt).
Currently, FINRA disseminates the actual size of the trade for investment grade agency debt securities that are less than or equal to $5 million in par value traded, but disseminates only the actual size of the trade for non-investment grade securities transactions that are less than or equal to $1 million in par value traded. According to FINRA, the only non-investment grade agency debt securities are credit risk transfer securities issued by Fannie Mae and Freddie Mac. Following a consultation with both of these issuers, FINRA determined to eliminate the differential treatment. According to FINRA, the proposal will simplify trade reporting and improve price transparency in these securities.
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