FASB preps new rule on securitization accounting

NEW YORK, April 30 (Reuters) - The Financial Accounting Standards Board, which sets U.S. accounting rules, is "pretty close" to issuing a new standard on securitization accounting that will affect off-balance sheet assets, its chairman said on Thursday.

Speaking at an accounting conference at Baruch College in New York City, FASB Chairman Robert Herz, said he expects a standard will be issued in the next few months, and take effect next year.

"We're pretty close to issuing a replacement," Herz said, adding that the prior standards on off-balance sheet accounting had been "stretched, abused and violated" in the run-up to the credit crisis.

The change to two accounting rules known as FAS 140 and FIN 46R would affect trillions of dollars in off-balance-sheet assets at banks and financial companies.

The FASB voted last year to eliminate a concept known as the "qualifying special-purpose entity," or QSPE, that banks used to keep assets like mortgage-backed securities and special investment vehicles off their books. (Reporting by Emily Chasan)