Letter from the Board Chair and the CEO (January 2022)
As we write this letter, the world remains in a united front against a global pandemic that is stretching beyond what any of us could have imagined nearly two years ago. Looking back at what we have accomplished over the past year amid this adversity, we are inspired by the dedication of our people to advance the MSRB’s mission to protect and strengthen the $4 trillion municipal securities market, which enables access to capital, economic growth and societal progress in communities across America.
This past year, in close collaboration with market stakeholders, the Board approved a long-range strategic plan and put forth a bold new vision for the future that will guide us in the years to come. The core pillars of this strategy remain firmly grounded in our mandate from Congress, and we are pleased to report early progress against our four strategic goals:
- First, to modernize our rulebook by retiring interpretive guidance that no longer achieved intended purposes and to provide targeted regulatory relief to dealers and municipal advisors grappling with the continued challenges of COVID-19;
- Second, to modernize the Electronic Municipal Market Access (EMMA®) website and our other market transparency technology systems;
- Third, to improve the quality of data we provide to the market by leveraging cloud computing and advances in data analytics; and
- Fourth, to protect and uphold the public interest and integrity of this market and act on our commitment to social responsibility and diversity, equity and inclusion (DEI).
The MSRB has embraced its responsibility as a leader in this industry to promote change, which must begin from within. As an organization, the MSRB is more diverse than at any point in its history, with women representing two-thirds of its 15-member board and more than half of staff identifying as a racial minority. While we are proud of where we stand today, there is more work to be done, and the MSRB is developing a strategy that is premised on the belief that advancing DEI is not only essential to our success as a regulator, but also for the success of the market we regulate.
The MSRB is committed to the highest standards for financial transparency and accountability, and to responsible stewardship of financial resources. As a private, self-regulatory organization (SRO), the MSRB’s revenues come primarily from the entities we regulate. Although the pandemic triggered a severe dislocation in the spring of 2020, the market proved its resilience and ended the year with record issuance volume. This market volatility contributed to operating reserves that exceeded target at the start of 2021, and the Board consequently approved a 40% reduction in the three primary market-based fees over an 18-month period, an action that is projected to return $19 million in accumulated excess reserves to the industry.
Looking forward, the MSRB is conducting a comprehensive examination of its finances and fee structure to ensure an equitable and sustainable balance of funding that will support our mandate to protect investors, issuers and the public interest.
As we emerge from this pandemic, we expect state and local governments will continue to drive economic growth and recovery by investing in public infrastructure, the majority of which will be financed through the market that we are entrusted to regulate. The MSRB will be there every step of the way, advancing our vision of giving America the confidence to invest in its communities.
Patrick Brett, Board Chair
Mark Kim, CEO
Letter from the CEO (September 2021)
For over 45 years, the MSRB has served as the principal regulator of the municipal securities market. As this dynamic market continues to evolve, the MSRB’s vision to give America the confidence to invest in its communities has never been more important. The market we regulate touches people’s lives every single day by financing the country’s infrastructure, from public schools that educate our children and hospitals that care for our loved ones to the water we drink. We remain firmly grounded in our Congressional mandate to protect investors, state and local government issuers and the public interest by promoting a fair and efficient market.
The pace of change is accelerating in every capital market, and municipal securities are no exception. There has never been a more important time for the MSRB to plan for the future and I am delighted to present our FY 2022-2025 Strategic Plan, which lays out a clear roadmap of where we are going, how we will get there and what it means for you. The four strategic goals and guiding principles will advance our mission to strengthen the market that enables access to capital and economic and social progress for communities across the country.
This Strategic Plan draws on input from an extensive public engagement process over the past year that included an open comment period and a series of in-depth interviews with core stakeholders—investors, issuers, broker-dealers and municipal advisors—as well as other market participants. In developing this plan, we stayed true to what we heard from you and trust you will see your important perspectives reflected within. As a self-regulatory organization, we depend on your ongoing engagement to keep this plan relevant, and ultimately, to achieve better outcomes.
You will see in this Strategic Plan our steadfast commitment to serve the public interest and embrace our social responsibility as a regulator. We will redouble our efforts not only to be a more diverse and inclusive organization, but also to promote greater diversity and inclusion within the market we regulate and to foster a more sustainable and resilient future.
On behalf of the MSRB, I wish to express my gratitude to everyone who contributed to the development of this Strategic Plan. In particular, I would like to acknowledge the commitment and dedication of our staff and Board of Directors who shared their thoughts, wisdom and vision for the future. Together, we will continue to build an organization that engenders public trust and gives America the confidence to invest in its communities. Onward!
Chief Executive Officer