Joint Comments to SEC on Staff Accounting Bulletin No. 121

Dear Chair Gensler:

The Bank Policy Institute ("BPI"), the American Bankers Association ("ABA"), the Financial Services Forum ("the Forum"), and the Securities Industry and Financial Markets Association ("SIFMA") (collectively, the "Associations") write to request that the Securities and Exchange Commission ("Commission") consider targeted modifications to Staff Accounting Bulletin No. 121 ("SAB 121") to address recent policy developments and the challenges that SAB 121 has posed for U.S. banking organizations since it was issued on March 31, 2022.

As the two-year anniversary of the issuance of SAB 121 approaches, the Associations believe now would be an appropriate time to examine and discuss the implications of SAB 121 for regulated banking organizations. There have been several relevant developments during this two year period, including the GAO report issued in October, approval of certain Spot Bitcoin ETPs, and the SEC's proposed rule on Safeguarding Advisory Client Assets that would cover the custody of digital assets if finalized as proposed. The Associations believe that SAB 121 can be modified to mitigate the specific challenges identified herein without undermining the stated policy objectives of the Commission to enhance the information received by investors and other users of financial statements.

The Associations are happy to continue to serve as a resource and work collaboratively with the Commission to provide recommendations that would ensure that investors are provided the requisite disclosures while allowing responsible innovation to occur. The Associations and Commission share the common goals of ensuring the highest levels of investor protection and implementing policies that advance principles of market integrity and financial stability.

We believe the recommendations set forth in this letter are consistent with those principles and would remove unintended barriers for well-regulated U.S. banking organizations to engage in certain activities. Below we describe the drivers behind this request and suggest targeted modifications to SAB 121.

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