ABS

  • Minimal impact expected from FDSL hike

    As of 1 July, interest rates on federal direct subsidised loans (FDSL) for US college students will double to 6.8%. Although the increase is being portrayed as harmful to students who would be driven further into debt, Moody's expects the overall effect on student loan securitisations to be minimal.

    The agency notes in its latest Credit Outlook publication that the .......

    News Round-up 2 July 2013

  • Asia managing partner poached

    Michelle Taylor and her team have joined Jones Day's banking & finance group in Hong Kong. She was formerly Asia managing partner and China office leader with Orrick. Her practice focuses on structured finance, real estate finance, debt capital markets, general banking and securitisation, where she has almost 20 years of experience.

    .......

    Job Swaps 2 July 2013

  • Subprime survives trading drop-off

    It was a quiet start to the holiday week in the US as the market moves into the third quarter. Non-agency RMBS BWIC volumes remain muted at US$90m, with dealer offering levels largely unchanged.

    Subprime RMBS supply held up better than other sectors yesterday. SCI's PriceABS data shows a number of subprime tranches for the session, although a .......

    Market Reports 2 July 2013

  • Student list buoys ABS session

    US ABS secondary trading was dominated yesterday by a large student loan list, during what was otherwise a quiet session. BWIC volume was just under US$100m, with aircraft ABS also accounting for a modest amount of paper.

    The most recently issued student loan bond circulating yesterday was SLMA 2013-R1 A, which was talked in the low-200s, according to SCI's PriceABS .......

    Market Reports 28 June 2013

  • Data, legal challenges remain for Chinese ABS

    More securitisation transactions are expected to launch in China, following new regulations promulgated under the specific asset management plan (SAMP) and the credit asset securitisation pilot scheme (CAS). However, challenges remain in data robustness, legal enforceability and transaction structure, according to Fitch.

    "Due to the rapid and continuous growth of China's economy in the past 30 years, asset delinquency and .......

    News Round-up 28 June 2013

  • Auto delinquencies hit 10-year low

    US prime auto ABS 60+ delinquencies stood at 0.29% in May, according to Fitch's latest index results - the lowest level seen in the last 10 years and unchanged month-over-month (MOM). The rate in May was also 24% improved year-over-year (YOY).

    Prime annualised net losses (ANL) posted a strong 30% drop in May over April, down to 0.17%. This rate .......

    News Round-up 28 June 2013

  • Casting nets

    Hunt for relative value puts range of options on the table

    European primary issuance may have been patchy this year, but liquidity in the secondary market has generally increased. The hunt for relative value has become all the more pressing as spreads have tightened.

    Regulatory initiatives such as Solvency II and CRD IV weigh on investors' minds, but until regulations come into force it is always possible that their provisions will .......

    News Analysis 28 June 2013

  • SME ABS proposals put forward

    The EIB and the European Commission have released a joint report detailing how the €10bn capital increase decided by Member States last year has been implemented. Entitled 'Increasing lending to the economy: implementing the EIB capital increase', the report also outlines new joint initiatives that aim to revive the structured credit markets to support SME lending.

    Collaboration by the EIB .......

    News Round-up 28 June 2013

  • Shifting sands

    European securitisation market seeks stability

    The first half of 2013 has seen significant changes in the European ABS market's investor base, issuance patterns and regulatory landscape. The sector has gone through a number of cycles since the financial crisis, but now there are suggestions of a 'new normal' taking hold.

    The RMBS market is one in which the investor base has changed markedly. One asset-backed .......

    News Analysis 27 June 2013

  • Trading vet moves on

    Southwest Securities has appointed George Smith as svp in its taxable fixed income division in New York. In his new position, he will manage MBS, ABS and CMBS trading.

    Smith was previously md, head of MBS/ABS/rates trading and structured finance at Gleacher. Before that, he worked as md, head of MBS/ABS trading and structured finance at Cantor Fitzgerald. He has .......

    Job Swaps 26 June 2013

  • Secondary traders seek Spanish tranches

    There was a Spanish flavour to yesterday's European ABS secondary trading, with a number of auto bonds also showing up on BWICs. In addition, several Spanish RMBS tranches were available, as well as a long list of Granite bonds.

    SCI's PriceABS data shows a number of Spanish consumer ABS tranches that circulated in yesterday's session. Among them was .......

    Market Reports 26 June 2013

  • ABS fastest out of the blocks

    US ABS secondary volume has started the week strongly, helping to compensate for lower levels in non-agency RMBS. Supply on Monday was elevated across the credit card, auto loan and student loan sectors.

    Around US$350m of ABS bonds circulated on BWICs yesterday, with auto, card and student paper dominating the session. A mix of various vintage senior and subordinate tranches .......

    Market Reports 25 June 2013

  • Commercial, residential solar risks weighed

    When considering the securitisation of commercial solar contracts, the assets are subject to less obsolescence risk than residential solar contracts, but face different types of contract risks (SCI 26 April). Sponsor and performance risks apply similarly for both residential and commercial solar contracts, however.

    Commercial entities are less likely than homeowners to stop payments on panels that technological changes over .......

    News Round-up 24 June 2013

  • Credit card performance to remain strong

    Moody's expects credit card trust collateral performance to remain near its current levels in the US, the UK and Canada through the end of 2013, as the steady improvement in performance since the recession comes to an end. However, collateral performance in Canada is anticipated to be relatively more sensitive to shifts in the country's unemployment rate than is the .......

    News Round-up 24 June 2013

  • German insolvency amendment 'credit negative'

    The German parliament last month passed an act amending the personal insolvency regime, shortening to three years from six the period after which a borrower under personal insolvency can discharge his remaining unsecured debt if he has repaid 35% of the total. The law will be effective from 1 July 2014.

    Moody's notes in its latest Credit Insight publication that .......

    News Round-up 20 June 2013

  • Card charge-off forecast lowered

    Steady improvement in early-stage delinquency rates, combined with stable roll rates point to a continued decline in US bank card trust charge-offs through the end of the year. As a result, Moody's has lowered its forecast for the Moody's Credit Card Index charge-off rate for 2013 to 3%-4%, down by 50bp from its forecast earlier this year.

    The agency expects .......

    News Round-up 20 June 2013

  • Spanish loan restructuring activity analysed

    Moody's believes the proportion of restructured loans backing more recent Spanish SME securitisations is higher than the reported figure. The largest 18 Spanish banks reported that by end-2012, on average, around 10% of their total lending portfolio consisted of refinanced or restructured loans. Restructured loans in their portfolios amounted to around €200bn.

    Moody's says in its latest Credit Insight publication .......

    News Round-up 19 June 2013

  • Subprime auto credit quality set to weaken

    Risk factors such as weakening loan credit, stiff competition among originators and readily available funding for ABS all portend higher credit losses for subprime auto lending, according to Moody's. Private equity money entering the market is further intensifying increasing competition from banks and credit unions.

    "The increased competition among subprime lenders is resulting in more loans to borrowers of weaker .......

    News Round-up 19 June 2013

  • Private student loan defaults decline

    Moody's expects its private student loan default rate index to continue falling year-over-year in 2013 with the pace of improvement continuing in the teens, as it has in the last four quarters. The default rate index of non-federally guaranteed student loans is also anticipated to remain higher than pre-recession levels.

    Though still high by historical standards, the unemployment rate - .......

    News Round-up 19 June 2013

  • CRA rules set

    New EU credit rating agency rules enter into force tomorrow (20 June). The aim is to increase rating agency accountability while reducing over-reliance on credit ratings, according to the European Commission.

    The new rules require financial institutions to strengthen their own credit risk assessment. European supervisory authorities should also avoid references to external credit ratings and will be required to .......

    News Round-up 19 June 2013

  • AA plans WBS

    The UK Automobile Association (AA) is prepping a whole business securitisation dubbed AA Bond Co. Proceeds will refinance part of the liabilities of the Acromas Group.

    The AA Group operates a roadside assistance service in the UK and Ireland, as well as providing complementary services, such as insurance, driving services and home emergency response. The AA provides breakdown services either .......

    News Round-up 18 June 2013
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