The document regarding Hearing on “Covered Bonds: Prospects for a U.S. Market Going Forward” December 15, 2009. Chairman Frank, Ranking Member Bachus, and Members of the Committee, I am grateful for your invitation to testify today on the crucial role that U.S. covered bonds can play in stabilizing our financial system and funding the needs of consumers, small businesses, and State and local governments. I am a partner in the Washington, D.C., office of Orrick, Herrington & Sutcliffe LLP and a member of the Steering Committee for the U.S. Covered Bond. Recent reports have confirmed what we are seeing on the ground: Our nation’s economic recovery remains slow and uneven, and the foundations of our financial system are not yet fully repaired. Weakness persists in the labor market, with over 17% of Americans being either unemployed or underemployed. Nearly one out of every four U.S. homeowners is underwater on a mortgage, and some economists are projecting that home prices now will not reach bottom until 2011. Multi-family and other commercial real estate is also suffering as property values continue their precipitous decline and loans mature without clear options for refinancing. In this volatile environment, credit remains relatively tight for both families and small businesses, public-sector resources are increasingly strained, and consumers are understandably cautious. In the Council’s view, sustained economic growth begins with a stable financial system. This, in turn, requires an ample supply of long-term and cost-effective funding that is sourced from diverse parts of the private-sector capital markets and that can be translated into meaningful credit for households, small businesses, and the public sector.