The FDIC's current rules for the treatment of securitizations under conservatorship or receivership provide safe harbor protections by confirming that in the event of a bank failure, the FDIC will not try to reclaim loans transferred into a securitization so long as an accounting sale had occurred, Bair explained. But changes approved last year by the Financial Accounting Standards Board mean that most securitizations will no longer meet the off-balance sheet standards for sale treatment. "As a result, most securitizations will not meet the test in the FDIC regulation unless we amend that rule," she said.

In November, the FDIC Board approved a transitional rule for safe harbor securitizations or participations that seeks to clarify the circumstances when the FDIC, as conservator or receiver, will treat a transfer for a securitization or participation as a sale. All securitizations or participations in process through March 31, 2010 would be permanently grandfathered in under this rule.

In December, FDIC approved a measure seeking public comment on what standards should be applied for safe harbor treatment for transactions created after March 31st. This is where the industry comes in, Bair said. We are requesting "input from the industry as to what standards we should set to help ensure that securitization will strengthen, not weaken, banks that are insured by the FDIC. The final rule will be developed based on the responses that we receive."

Much of the proposed rule focuses on RMBS, she noted. "But we also recognize that there are differences between the various securitized asset classes. CMBS is different from residential MBS. That is why we need active involvement from your industry in spelling out the new standards that will qualify for the safe harbor under our final rule."