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

MSRB TO CONDUCT STUDY ON MUNICIPAL MARKET STRUCTURE AND TRADING  

Alexandria, VA – The Municipal Securities Rulemaking Board (MSRB) today announced that it will undertake a study of the municipal securities market, including a review of market structure and trading patterns. The study will review transaction costs, price dispersion and other market data to help the Board assess whether the market is operating as efficiently and fairly as possible. It also will assist the Board in evaluating whether pricing mechanisms and liquidity in the market could be improved with higher levels of pre-trade price transparency.

“A core part of the MSRB’s mission is to promote a fair and efficient market, and this study on pricing efficiency and liquidity is consistent with that mission,” said MSRB Executive Director Lynnette Kelly Hotchkiss in announcing the study in remarks at today’s Securities and Exchange Commission (SEC) hearing on the municipal market. “Once the study is completed, we can determine whether additional pre-trade information would provide benefits to market participants.”

The MSRB, which protects investors, municipal entities and the public interest, promotes municipal market transparency and a fair and efficient market through the broad dissemination of post-trade municipal securities transaction data. The MSRB collects and disseminates for free to the market price data on an average 40,000 municipal securities transactions each day through its MSRB’s Electronic Municipal Market Access (EMMA) website.

“I am delighted that the MSRB has decided to review these important [pricing and quotation] issues as it seeks opportunities to improve the quality of the municipal securities market for the benefit of investors,” said SEC Commissioner Elisse B. Walter in her opening remarks at the SEC hearing.

The MSRB expects to review initial data from the study in 2011.

The Municipal Securities Rulemaking Board (MSRB) protects and strengthens the municipal bond market, enabling access to capital, economic growth, and societal progress in tens of thousands of communities across the country. The MSRB fulfills this mission by creating trust in our market through informed regulation of dealers and municipal advisors that protects investors, issuers and the public interest; building technology systems that power our market and provide transparency for issuers, institutions, and the investing public; and serving as the steward of market data that empowers better decisions and fuels innovation for the future. The MSRB is a self-regulatory organization governed by a 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.

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