Research

Research on Municipal Bond Disclosure

DPC DATA periodically publishes original research on disclosure efficiency of the US municipal bond market. These studies are based on statistical analysis of disclosure behaviors of bond obligors and related factors. They were covered by the Wall Street Journal, the New York Times, CNN and other financial news venues, and discussed by regulators and lawmakers, as well as industry leaders concerned with municipal bond disclosure.

They are free to download with a registration. Click on the title below to go to the registration page. There you will be able to select additional studies if you wish. The download will follow.

Recent Trends in Municipal Disclosure Activities

This study, issued in February 2011, found that failure to file annual financial disclosure documents appears to be rising among issuers and obligors of municipal bonds. With the additional impact of annual financial statements filed too late to be of practical use in credit risk analysis, the study suggested that the deterioration in market transparency appeared to extend to 60-70 percent of municipal bonds with filing obligations.

The Consequences of Poor Disclosure Enforcement in the Municipal Securities Market

The study, published in February 2009, matched trade data with officially filed disclosures, focusing on material event notices that typically indicate distressed bonds. DPC DATA found hundreds of trades that were questionable in terms of meeting regulatory standards for investor protection. In approximately half of the trades, investors could not protect themselves, because no recent financial disclosures had been filed.

Estimating Municipal Securities Continuing Disclosure Compliance: A Litmus Test Approach

The first study of the series, published in September 2008, analyzed the first full ten years of disclosure performance following 1994 amendments to the SEC’s Rule 15c2-12, which established the municipal market’s current disclosure regime. Studying the disclosure practices of more than 35,000 eligible bond issues that came to market from 1996 to 2005, the study found the first broad-based evidence of failure to file by issuers and obligors, with indications that the trend was increasing yearly.

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Estimating Municipal Securities Continuing Disclosure Compliance
Recent Trends in Municipal Continuing Disclosure Activities
The Consequences of Poor Disclosure Enforcement in the Municipal Securities Market