ASIC has announced changes to the naming of debt products such as debentures and secured notes.

ASIC introduced the ‘secured note’ description by providing relief to the law under ASIC Class Order [CO 12/1482] When debentures can be called secured note.

ASIC will now permit issuers of debt to name its product a secured note if there is a first ranked security over some assets, so long as conditions about describing the security are met. Issuers may only call a product a debenture if the security is over tangible property.

All issuers must make clear in their advertising that the products are not a bank deposit and must not suggest that they compare favourably to a bank deposit.

Regulatory Guide 69 Debentures and notes: Improving disclosure for retail investors (RG 69) and Regulatory Guide 156 Advertising of debentures and notes to retail investors (RG 156) have been updated.