An expected flood of filings at the SEC is threatening to delay asset-backed offerings slated for the first few months of next year.

Many issuers planning early-2006 transactions have waited until the last minute to draft documents that comply with the agency's new Regulation AB, which requires issuers to follow revised disclosure procedures for any offerings conducted after Dec. 31.

The resulting logjam of paperwork is likely to gum up the ability of the SEC's relatively small staff - fewer than 16 analysts dedicated to Reg AB - to respond to issuers within the hoped-for 30 days after it receives the filings. And that could spoil some issuers' plans to conduct offerings in February or March.

No issuers are compliant yet, but the bulk of the participants in an SEC pilot program are close, said Max Webb, who is overseeing the initiative. "There is a trickle [of filings coming in] right now, and I expect it will get bigger," he said.

In anticipation, Webb's unit cleared its collective desk, sending some of its work - such as reviews of operating companies - to other parts of the agency. The group has also added four attorneys from other areas of the commission. One of the four is Sara Kalin, who transferred from another SEC office to join Webb's staff as legal chief.

Despite those efforts, Webb said the avalanche of late filings could delay the SEC's responses. "There may be a timing issue," in responding to issuers, he told 400-plus attendees at a Reg AB conference hosted by the American Securitization Forum in New York on Dec. 5.

Webb noted there that the SEC was delayed in responding to some participants in the pilot program, since 15 of the 19 participants filed their statements on the last possible day. Webb also said that the SEC is working under severe budgetary constraints, including a hiring freeze and the inability to pay overtime. As a result, Webb can't replace anybody who leaves his team over the next few months.

Many market players acknowledge that issuers themselves are to blame for congestion at the SEC, which gave issuers a little more than a year to adjust to Reg AB - an unusually long lead time. SEC rules often take effect just 30, 60 or 90 days after they are adopted.

The rush to file in January will take a toll on the holiday work schedules of lawyers and accountants who are involved with Reg AB compliance for their clients or employers. "Don't plan on being out of the office on a long vacation anytime soon," ASF associate director Tom Deutsch told the conference audience.