MSRB Receives Approval to Improve Price Transparency for "Not Reoffered" Municipal Securities

Date: September 24, 2012

Contact: Jennifer A. Galloway, Chief Communications Officer
             (703) 797-6600


Alexandria, VA – The Municipal Securities Rulemaking Board (MSRB) has received approval from the Securities and Exchange Commission to limit the use by brokers, dealers and municipal securities dealers of the designation “not reoffered” or “NRO” without also including price or yield information in written communications about new issues of municipal securities.

The designation “NRO” or “not reoffered” indicates that certain maturities of a new issue of municipal securities are not available to be reoffered to potential investors. The new limits on the use of the NRO or not reoffered designation will improve the availability of current information about initial offering prices or yields of new issues of municipal securities. 

The requirement that the NRO or not reoffered designation not be used without also including the applicable price or yield information is an amendment to MSRB Rule G-34 on new issues and market information requirements. This new requirement, which becomes effective November 1, 2012, will apply to any written communication sent at or after the time an issuer accepts the terms of the new issue of municipal securities from an underwriter.

Underwriters currently are required to report initial offering price or yield information for all maturities, including maturities designated as NRO, to the MSRB’s Electronic Municipal Market Access (EMMA®) website, as well as to the New Issue Information Dissemination System (NIIDS) operated by the Depository Trust and Clearing Corporation. This information becomes available to market participants and the general public during or by the end of the first day of trading in the new issue. The approved rule change will ensure that any information provided to the marketplace by dealers regarding new issues prior to such centralized public dissemination and through other market venues also includes the applicable price or yield information for securities designated as NRO.

The MSRB protects investors, state and local governments and other municipal entities, and the public interest by promoting a fair and efficient municipal securities market. The MSRB fulfills this mission by regulating the municipal securities firms, banks and municipal advisors that engage in municipal securities and advisory activities. To further protect market participants, the MSRB provides market transparency through its Electronic Municipal Market Access (EMMA®) website, the official repository for information on all municipal bonds. The MSRB also serves as an objective resource on the municipal market, conducts extensive education and outreach to market stakeholders, and provides market leadership on key issues. The MSRB is a self-regulatory organization governed by a 21-member board of directors that has a majority of public members, in addition to representatives of regulated entities. The MSRB is overseen by the Securities and Exchange Commission and Congress.