The AGCBACFOIB has already published its first press release, welcoming recently-established industry bodies.
“The Association of Global Covered Bond Associations, Councils, Forums & Other Industry Bodies welcome the formation of the Sifma covered bond group, the European Covered Bond Dealers Association (ECBDA), and the other Sifma covered bond group, the US Covered Bonds Council (USCBC),” it said. “AGCBACFOIB looks forward to working with these two groups as well as the European Covered Bond Council (ECBC), the Financial Markets Association (ACI) Germany, the Securities Industry & Financial Markets Association (Sifma), the American Securitisation Forum (ASF), the European Securitisation Forum (ESF), the Association of German Pfandbrief Banks (Verband deutscher Pfandbriefbanken, (vdp) (formerly known as the Association of German Mortgage Banks (Verband deutscher Hypothekenbanken (vdh))), the League of Extraordinary Gentlemen, the People’s Front of Judea, the Popular Front of Judea, the Judean People’s Front, and any other combination of letters from the alphabet.”
Indeed one of AGCBACFOIB’s missions is to foster the creation of covered bond associations around the world.
“In particular, we support Sir James Crosby’s recent call for the creation of a UK covered bond association with a similar mission to the vdp and would encourage others in countries such as Spain and France to follow this great German example.”
A full agenda for the AGCBACFOIB has not yet been decided. Fees, however, have been set: they will be very high, but include a subscription package to The Cover.
A pressing matter for the new body to deal with will be resolving the ongoing dispute between the ECBC and the USCBC over whether the correct term for such industry bodies is a “Covered Bond Council” or a “Covered Bonds Council”. The disagreement already threatens a transatlantic rift.
“We say nee-ther,” said a spokesperson for the ECBC. “They say ny-ther. We say tomay-to. They say tomah-to.
“Let’s call the whole thing off.”
The vdp has already put forward a compromise term: “Verband.”
There will also be a technical working group that will gather to compile a factbook on the different types of facial hair within the covered bond market and to study whether this has any correlation with membership of industry bodies.
Decision-making suspended
In order to avoid unnecessary bureaucracy, decisions will be taken by The Cover’s One-to-one committee. The One-to-one committee was created in September 2007 to handle crisis situations and its first action was to suspend covered bond reporting in the wake of the breakdown in market-making.
|
|
|
The Cover's "One-to-One" Committee: "Ask not what you can do for your country. Ask what's for lunch." |
Since recommending the resumption of reporting the next day the committee has managed to steer clear of taking any decisions, thereby avoiding the errors of the ECBC’s Eight-to-eight committee, which in January had to backtrack on a decision to move the market back to tighter market-making standards. The Eight-to-eight committee has nevertheless regained credibility by refraining from making any subsequent recommendations.
Based on this experience, a working group composed of one individual from each existing covered bond association will be formed to decide when not to take decisions.
“Our research shows that there is a high correlation between inactivity among covered bond associations and improvements in the covered bond market,” said a leading covered bond analyst. “Indeed the model has an r-squared of 1.00.”
He also forecast that by 2015 there will be 11,502.78 covered bond associations.
Previous satirical pieces published by The Cover have occasionally been taken at face value, so we would like to stress that this article should in no way be taken seriously. If you have done so, then please forgive us our humble attempt to provide some festive cheer.