To Whom It May Concern:
The Bank Policy Institute and the American Bankers Association (together, the “Associations”) appreciate the opportunity to comment on the Securities and Exchange Commission’s proposals relating to Share Repurchase Disclosure Modernization (the “Share Repurchase Proposal”) and Rule 10b5-1 and Insider Trading (the “10b5-1 Proposal”). The Associations understand the SEC’s efforts to provide investors with more meaningful disclosure pertaining to share repurchases and to limit opportunities for inappropriate use of plans designed to benefit from the Rule 10b5-1(c) safe harbor; however, the Associations share the concerns of issuers across industries that, contrary to the SEC’s intentions, certain elements of the proposals would disrupt markets, facilitate manipulation and harm investors. The Associations encourage the SEC to accept recommendations to address these concerns.
In addition to agreeing with those broad concerns, the Associations are further concerned that, due to the interplay between these proposals and the extensive capital and capital planning regulatory requirements already applicable to large bank holding companies and savings and loan holding companies (collectively, “Regulated Banking Institutions”), certain elements of the proposals would adversely and disproportionately impact Regulated Banking Institution issuers and would contradict longstanding U.S. bank regulatory policy to encourage Regulated Banking Institutions to use share repurchases rather than dividend distributions as the preferred mechanism for returning capital to shareholders. For this reason, it is imperative that the SEC consult with the Board of Governors of the Federal Reserve System, which is primarily responsible for administering the capital requirements applicable to Regulated Banking Institutions, prior to finalizing these proposals. Doing so would help to ensure that any securities regulations that might impact the share repurchase practices of Regulated Banking Institutions will harmonize with the important safety, soundness and financial stability policies of the Federal Reserve.
This harmonization is particularly important because, due to the extensive capital and capital planning regulatory framework applicable to Regulated Banking Institutions, and the frequency with which Regulated Banking Institution issuers typically engage in share repurchases, the general concerns cited in the proposals with respect to inappropriate and opportunistic use of share repurchases should not apply in the same way to Regulated Banking Institution issuers. Thus, the benefits of applying the proposals to Regulated Banking Institution issuers would not outweigh the costs.
To read the full comment letter, please click here.
 The Bank Policy Institute is a nonpartisan public policy, research and advocacy group, representing the nation’s leading banks and their customers. Our members include universal banks, regional banks and the major foreign banks doing business in the United States. Collectively, they employ almost 2 million Americans, make nearly half of the nation’s small business loans, and are an engine for financial innovation and economic growth.
 The American Bankers Association is the voice of the nation’s $23.7 trillion banking industry, which is composed of small, regional and large banks that together employ more than 2 million people, safeguard $19.7 trillion in deposits and extend more than $11.2 trillion in loans.
 All bank holding companies and savings and loan holding companies are subject to capital and capital planning requirements. These requirements become more detailed and prescriptive for banking institutions with at least $100 billion in total assets.