ABS

  • UK card delinquencies hit all-time low

    UK credit card charge-offs and delinquencies fell to a new all-time low in 2Q14, after losing momentum in the first three months of the year, according to Fitch's latest indices for the sector. The improvements were slightly exaggerated by the exclusion of the fully repaid Sherwood trust from the indices.

    Fitch expects charge-offs to keep falling slightly or remain stable .......

    News Round-up 8 August 2014

  • Japanese credit quality correlations examined

    Japanese structured finance credit performance and fundamentals have generally remained stable for the past couple of years. However, transaction-specific risks and certain macroeconomic elements remain key factors with the greatest potential to undermine this stability, according to S&P.

    The agency says the top-five macroeconomic factors that have been leading indicators of the credit quality of Japanese structured finance deals in .......

    News Round-up 8 August 2014

  • Servicer swap for Spanish card ABS

    Fitch says that it does not expect any immediate performance or rating impact on the IM Citi Tarjetas 1 credit card ABS, following Citibank Espana's exit of the Spanish credit card market. Citibank Espana is asset servicer for the securitisation.

    Bancopopular-e, an independent banking franchise of Banco Popular Espanol, is expected to acquire Citibank Espana's credit card business and thus .......

    News Round-up 8 August 2014

  • Conflict of interest

    Litigation activity turning towards trustees

    The focus of US financial crisis-related litigation activity is turning towards the trustee community. The fundamental issue at stake in this new breed of dispute is who's going to pay.

    Pre-crisis securitisations were often structured with little consideration for the conflict of interest between parties seeking resolution to an issue and those with the ability to authorise the pursuit of .......

    News Analysis 8 August 2014

  • Green bond committee formed

    After support for a set of green bond principles (GBP) was announced earlier in the year (SCI 14 January), an initial executive committee has now been appointed to oversee the GBP governance framework. The committee consists of representatives from 18 organisations, including investors, issuers and underwriters.

    The committee's key priority will be to oversee the 2015 update of the principles .......

    Job Swaps 7 August 2014

  • LatAm receivables ABS gaining track record

    S&P reports that it has rated 107 Latin American trade receivables ABS transactions, with 224 classes of debt, since it began rating these types of securitisations in the region 10 years ago. Of this approximately US$6.2bn of rated volume, 81% was backed by Brazilian assets.

    S&P notes that successful examples of how this funding technique has benefitted both companies and .......

    News Round-up 7 August 2014

  • Russian DPR deal downgraded

    Fitch has downgraded Roof Russia DPR Finance Company to triple-B plus from single-A minus, outlook negative. The rating action comes after the downgrade of originator ZAO Raiffeisenbank (RBRU), following the revision of Russia's country ceiling to triple-B from triple-B plus.

    The rating of Roof Russia DPR's notes remains one notch above RBRU's long-term local currency IDR. Negative outlooks on the .......

    News Round-up 6 August 2014

  • APAC downgrade rate trends higher

    Moody's reports that in 2013 the 12-month downgrade rate for its Asia-Pacific (ex-Japan) structured finance portfolio trended higher on a year-on-year basis, rising from 4.2% to17.5%. Over the same period, the 12-month upgrade rate increased slightly from 0.7% to 1.7%.

    The average notches per downgraded issuer rose to 6.2 notches, more than double the 2.5 notches observed in 2012. The .......

    News Round-up 6 August 2014

  • RFC issued on transformer criteria

    AM Best is requesting feedback on a new draft criteria report on rating reinsurance/insurance transformer vehicles. The report describes the rating agency's approach and highlights rating considerations unique to the evaluation of ILS transformer vehicles and the process by which the transformer vehicles act as an intermediary to transfer insurance risks to various counterparties.

    The new criteria generally apply to .......

    News Round-up 6 August 2014

  • Accounting to drive tender activity

    European securitisation analysts at Citi suggest that only securitisations that are consolidated on bank balance sheets are likely to be tendered going forward because the originator will not recognise any accounting gain from the buyback of bonds issued by deconsolidated entities. The implementation of IFRS 10 could prompt more originators to reassess their control over SPVs and may lead to .......

    News 5 August 2014

  • Timeshare delinquencies hit post-crisis lows

    Total US timeshare ABS delinquencies for 2Q14 stood at 2.92%, down from 3.19% in 1Q14 and 3.05% in 2Q13, according to Fitch's latest index results for the sector. This marks two years of consistent year-over-year improvement and is the lowest level of delinquencies reported by the Fitch index since 2007.

    The agency notes that defaults are consistent with last quarter, .......

    News Round-up 5 August 2014

  • Queen Street III defaults

    S&P has lowered to D (default) from double-C its rating on the US$150m Queen Street III Capital catastrophe bond, sponsored by Munich Re. The transaction covered losses due to major European windstorms between July 2011 and July 2014.

    The downgrade reflects the fact that noteholders did not receive at least 99.99% of the outstanding principal back on the notes' redemption .......

    News Round-up 5 August 2014

  • Subprime auto investigation underway

    The US Department of Justice has issued a subpoena to General Motors Financial Company, directing the firm to produce certain documents relating to its origination and securitisation of subprime auto loans since 2007. The move is in connection with a DOJ investigation in contemplation of a civil proceeding for potential violations of the Financial Institutions Reform, Recovery and Enforcement Act .......

    News Round-up 5 August 2014

  • Basel 3 jurisdictional differences emerging

    Moody's reports that while Basel 3 implementation is proceeding globally, notable differences are evident between jurisdictions in a number of areas, including pace, the degrees of strictness relative to Basel Committee guidance and the resulting challenges that banks face. The agency suggests that some of the weaknesses associated with Basel 2 have not been sufficiently addressed and that it is .......

    News Round-up 4 August 2014

  • Greek sovereign ceiling raised

    Moody's has raised the maximum achievable rating for Greek structured finance transactions to Ba3 from B3, after it upgraded Greece's government bond rating to Caa1 from Caa3 and the local and foreign currency bond and deposit ceilings to Ba3 from B3. The agency says the move reflects the country's reduced economic, legal and political risks.

    Specifically, Moody's notes that the .......

    News Round-up 4 August 2014

  • Punch B upside expected

    With the ABI special committee now supporting the latest Punch restructuring proposal (SCI 22 July), it now appears likely that the restructuring could be completed within the next six months. European asset-backed analysts at Barclays Capital see most upside in the Punch B securitisation under this scenario, given that the Punch A class B notes have more value as currently .......

    News 1 August 2014

  • Auto losses maintain lower levels

    Annualised US prime auto losses were flat month-over-month through June this year at 0.24%, but remain far lower than the rates seen in 2005-2006, according to Fitch's latest index results for the sector. Annualised net losses (ANL) ranged from 0.52%-1.32% back in 2005-2006, while ANL were just 0.17%-0.49% in 2013-2014.

    Fitch's prime auto loan ABS 60+ days delinquency index stood .......

    News Round-up 1 August 2014

  • Duration benefits seen in Seaco deal

    Seaco's latest container deal - the US$500m Global SC Finance II series 2014-1 - is noteworthy not only for its size, but also for its structure. The transaction was last week upsized from US$400m before pricing, becoming the largest issuance seen in the sector since 2011.

    The structure features two pari passu tranches, each with a 10-year expected final maturity .......

    News Round-up 31 July 2014

  • Trade finance ABS to prepay

    Lighthouse Trade Finance Issuer I is to be redeemed on 18 August at the request of the originator BNP Paribas. The move comes almost a year after the transaction was completed (SCI 22 August 2013).

    Fitch, which rated the deal, notes that the originator has exercised an optional redemption and prepayment provision of the documentation. It is understood that the .......

    News Round-up 31 July 2014

  • Conduits benefitting from full support

    Moody's expects EMEA ABCP conduits to no longer be exposed to asset performance risk, as transactions financed by these conduits will almost exclusively be fully supported by liquidity support. The agency notes that the trend to fully supported transactions financed by EMEA ABCP has recently accelerated, with the conversion so far this year of two partially supported conduits - Scaldis .......

    News Round-up 31 July 2014

  • US ABS activity picks up

    After a slow start to the week, yesterday's session brought an increase in US ABS secondary market activity. BWIC volume climbed to US$184m as SCI's PriceABS data captured 28 unique US ABS tranches, including a number of auto and student names.

    A striking number of auto ABS tranches were making their first appearance in the PriceABS .......

    Market Reports 31 July 2014
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