ABS

  • SLABS defaults, delinquencies drop

    US private student loan (PSL) defaults dropped below 2.5% for the first time since 2006 and will remain at pre-recession levels, according to Moody's. The default index fell to 2.4% in 3Q14 - continuing a two and a half year decline - while the 90-plus delinquency rate index remained at its historic low of 1.9%.

    "The loans backing 2010-14 securitisations .......

    News Round-up 23 December 2014

  • Ocwen settles NY charges

    Ocwen Financial has reached a settlement with the NYDFS to address its violations of a consent order issued by the regulator in 2012, as well as various violations of its agreement with the regulator in connection with its purchase of Litton Loan Servicing in 2011. There should be no direct impact on non-agency RMBS but certain ABS payments could be accelerated.

    News 23 December 2014

  • Venture debt ABS approach updated

    Moody's has republished its global methodology for rating SME balance sheet securitisations primarily to incorporate its approach to rating venture debt transactions. The agency says that the publication of the formal methodology will not result in any changes to ratings of any outstanding securities backed by venture debt.

    Moody's originally published a request for comment on its approach to rating .......

    News Round-up 22 December 2014

  • DBRS buyout agreed

    The Carlyle Group and Warburg Pincus, in partnership with a consortium of Canadian-based investors - including DBRS founder Walter Schroeder and DBRS management - have agreed to acquire DBRS. Terms of the transaction, which is expected to close in 1Q15, were not disclosed.

    Schroeder will remain an important investor in DBRS. He comments: "While our Canadian franchise and culture will .......

    Job Swaps 22 December 2014

  • RFC issued on life insurance ABS

    Moody's is seeking comments on its proposed approach to monitoring life insurance ABS. The agency says that the approach, if adopted, will not have any impact on the outstanding ratings of life insurance ABS.

    The proposed methodology entails a quantitative and qualitative approach to analyse life insurance ABS transactions with or without the support of supplemental policies, while accounting for .......

    News Round-up 19 December 2014

  • Auto losses up but historically low

    Losses were up for both US prime and subprime auto loan ABS last month. Subprime losses were higher than they have been since early 2010, according to the latest monthly index results from Fitch.

    Subprime auto loan ABS losses moved 4.6% higher to 7.96% in November. Annualised net losses (ANL) for prime auto ABS also moved higher, but are still .......

    News Round-up 19 December 2014

  • Is this it?

    First ABSPP purchases underwhelm market

    Purchase volumes in the first few weeks of the ECB's ABSPP have disappointed market participants. The utility of the purchase programme is also in question unless the mezzanine buyer base can be expanded.

    Last week, ABSPP purchases dropped to €187m, bringing the ECB's total settled ABSPP volume to €788m since the programme started last month. "So far, purchase volumes have .......

    News Analysis 19 December 2014

  • Euro ABS/MBS close to shut down for the year

    The European ABS/MBS secondary market has all but shut down for year-end as from today.

    "This look like it's pretty much it for the year," says one trader. "Spreads haven't moved this morning, but that's theoretical anyway as there has been no visible trading."

    A few very small clips in recently popular names are understood to have changed hands, but .......

    SCIWire 18 December 2014

  • C&E ABS gaining traction

    The growing US economy is set to support good performance in US ABS backed by a range of commercial and esoteric (C&E) asset types, says Moody's. At the same time, recent legal, regulatory and legislative developments could affect transactions in several C&E sub-sectors.

    Economic improvements should particularly support the performance of small-ticket, construction and trucking equipment, along with railcar and .......

    News Round-up 17 December 2014

  • Auto ABS to 'modestly deteriorate'

    Loosening underwriting standards and a greater proportion of borrowers with weaker credit characteristics will cause the quality of US auto ABS pools to modestly deteriorate in 2015, says Moody's. The improving economy and increasing competition among auto lenders has led to the easing of strict underwriting criteria that were adopted in the wake of the financial crisis.

    "Our expectations for .......

    News Round-up 17 December 2014

  • Economy to support private SLABS

    The strengthening US economy is positioning private student loan ABS for a more stable performance next year, according to Fitch. Collateral performance is expected to stabilise further as unemployment drops, while the prospect of rising interest rates should have little more than a negligible effect on ratings.

    "Performance of private student loan deals issued post-crisis is benefiting from more stringent .......

    News Round-up 17 December 2014

  • Stable outlook for APAC

    Fitch expects the ratings and asset sector performance of Asia-Pacific structured finance (SF) transactions to remain stable over the course of 2015. Most public long-term ratings for the sector are likely to remain at their current level throughout next year, largely similar to the situation in 2014. Of the 12 outlooks that were not stable at end-3Q14, six were positive .......

    News Round-up 17 December 2014

  • European secondary struggles on

    Year-end illiquidity in European secondary markets is being exacerbated by volatility in broader markets.

    "The macro-economic environment isn't helping, but it's very slow anyway," says one trader. "Bid-offers are much wider but there's not a lot of trading, which in one way is good as it means we're not seeing any capitulation - there's no client selling."

    There is however, .......

    SCIWire 17 December 2014

  • China rising

    Regulators fuel Chinese issuance boom

    Chinese securitisation issuance has rocketed this year as regulatory restrictions have been relaxed. A diversification of issuers and asset types is also boosting issuance as part of a virtuous circle of growth, although the strength of potential investor appetite is yet to be tested.

    Moody's puts Chinese issuance year-to-date in 2014 at CNY213bn. That is up from just CNY16bn in .......

    News Analysis 16 December 2014

  • Euro secondary slows further

    European secondary markets are getting ever closer to a Christmas standstill.

    "It's definitely slowed right down today," says one trader. "There's nothing going on in the Street and no real client activity - there are a couple of BWICs due today, but that's it."

    Spreads have largely stayed steady. However, the trader notes: "On the few BWICs we've seen of .......

    SCIWire 16 December 2014

  • ABSPP volume drops again

    The ECB has announced its latest total settled ABSPP volume as €788m .

    Last week's drop in volume to only €187m is likely to increase traders' complaints over the pace of ABS purchasing by the central bank. However, some market participants remain less surprised at ECB activity levels given the internal approval difficulties that ABS purchases present, as well as .......

    SCIWire 15 December 2014

  • ILF rating criteria debuts

    AM Best has released what is believed to be the first rating criteria specifically focused on insurance-linked funds (ILF). The criteria assesses an ILF's average credit quality and vulnerability to losses due to credit defaults in a portfolio constituted primarily of insurance-linked assets, and the inability of the fund to fulfil specific and direct contract obligations associated with insurance-linked assets .......

    News Round-up 15 December 2014

  • Capital markets partner added

    Kramer Levin has recruited Gilles Kolifrath as partner. He was formerly general counsel and head of compliance of AXA France, as well as a member of its management committee.

    Kolifrath's practice includes drafting financial/hedge transactions, securitisation transactions and credit agreements; negotiating complex financial transactions, including credit derivatives; and real estate transactions, Luxembourg funds and corporate law. He was an ISDA .......

    Job Swaps 15 December 2014

  • 'Women in Securitisation' initiative formed

    SFIG is set to launch a 'Women in Securitisation' initiative with a special event at the group's annual industry conference, ABS Vegas 2015. The initiative - which is open to members and non-members of SFIG - will be co-chaired by Fitch md Wendy Cohn and Wilmington Trust vp Patricia Evans.

    Through a combination of direct industry engagement, peer mentoring and .......

    Job Swaps 15 December 2014

  • European secondary continues to wind down

    The European ABS, MBS and CLO markets look set for another quiet day today.

    "The markets are coasting as people check out for year end," says one trader. "That combined with continued frustration over the lack of speed of ECB purchases makes for a very quiet market - there are only a couple of BWICs in ABS and CLOs today .......

    SCIWire 12 December 2014

  • Securitisation risk weights hiked

    The Basel Committee has issued revisions to the securitisation framework that aim to address a number of shortcomings in the Basel 2 securitisation framework and to strengthen the capital standards for securitisation exposures. This framework, which will come into effect in January 2018, raises the risk weight floor for securitisation exposures to 15%.

    The most significant revisions with respect to .......

    News Round-up 12 December 2014
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