ABS

  • Italy, Spain ABS reviews complete

    Moody's has revised key collateral assumptions in 29 Italian and Spanish ABS transactions backed by consumer and auto loans. New loss assumptions generally have no rating impact, although certain transactions have been downgraded.

    The rating revisions follow the agency's review of the Italian and Spanish auto and consumer loan sectors and were primarily driven by collateral performance deterioration as a .......

    News Round-up 24 December 2012

  • PAYE repayment plan welcomed

    Fitch believes that the 'Pay as You Earn' income-based student loan repayment plan could have a positive impact on FFELP ABS portfolios. The programme is designed to modify Federal direct loans and may reduce the financial pressure on some student loan borrowers that may also carry FFELP loans.

    "We believe it is possible that the new programme could help some .......

    News Round-up 21 December 2012

  • SLABS outlook remains negative

    The outlook for US student loan ABS remains negative, says Moody's. That is the case for both private loan and FFELP securitisations.

    Moody's says securitisations of private student loans will contain loans of slightly stronger credit quality in 2013 than they did in 2012. Collateral performance of outstanding securitisations will improve modestly but still be weak because of the wider .......

    News Round-up 21 December 2012

  • Stress tests underline ratings resilience

    Fitch says that stress tests it conducted across a range of structured finance asset classes globally shows that its ratings would be resilient in the face of further stress. The tests suggest that the extent of macroeconomic stress that would be required to result in severe multiple category downgrades to its triple-A ratings is very remote. In many instances, the .......

    News Round-up 19 December 2012

  • Spanish SME assumptions revised

    Moody's has revised its key collateral assumptions in 94 Spanish SME ABS. In most cases, the new loss assumptions have had no rating impact due to sufficient credit enhancement levels. However, the agency has taken individual rating actions on a small number of transactions with insufficient credit enhancement.

    These revisions follow Moody's review of the entire Spanish SME and small .......

    News Round-up 19 December 2012

  • Securitisation framework revisions proposed

    The Basel Committee has published a consultative paper entitled 'Revisions to the Basel Securitisation Framework'. The Committee says its objectives are: to make capital requirements more prudent and risk-sensitive; to mitigate mechanistic reliance on external credit ratings; and to reduce current cliff effects in capital requirements.

    There are three major elements to the proposed revised framework. First, two possible hierarchies .......

    News Round-up 19 December 2012

  • Italian ABS assumptions revised

    Moody's has revised key collateral assumptions in 41 Italian ABS transactions backed by leases and loans to SMEs. The new loss assumptions generally have no rating impact, but the agency has taken individual rating actions on a small number of transactions with insufficient credit enhancement.

    The rating revisions follow Moody's review of the entire Italian lease and SME ABS sectors .......

    News Round-up 19 December 2012

  • Asian attraction

    Yield available, although challenges remain

    The structured finance markets in Asia face significant constraining factors in 2013. A preference for covered bonds will limit RMBS issuance on the mainland, while deal volume in Japan and Australia is expected to be flat to lower, with demand continuing to outstrip supply.

    Gregory Park, managing partner at Northstone Peak, notes that the structured finance market in Asia remains .......

    News Analysis 19 December 2012

  • Rally drivers

    US ABS recovery subject to potential shocks

    The US ABS market rallied strongly in 2012, with CLO and CMBS issuance volumes in particular surprising many. A substantial recovery is anticipated in most areas next year, although this remains subject to potential fiscal and regulatory shocks.

    "Across the spectrum of securitised products, 2012 has turned out to be an impressive year for investors, with substantial double-digit returns - .......

    News Analysis 18 December 2012

  • Not giving in

    Solid 2013 anticipated for European securitisation

    The European securitisation market has been dominated by regulatory pressures, but - as participants become more comfortable with the changes being imposed - secondary market rallies have made primary issuance increasingly attractive. Supply in 2013 is expected to be broadly steady, with issuance anticipated right from the start of the year.

    Kevin Ingram, partner at Clifford Chance, believes that while .......

    News Analysis 18 December 2012

  • Loan-level regulatory implications noted

    Opinion is divided among market participants as to whether the ECB and Bank of England's loan-level data requirements will bring meaningful benefits for investors and whether such benefits outweigh the cost to originators of providing this information in the appropriate formats, according to Reed Smith in a recent client memo. While increased compliance costs are a disincentive to ABS issuance, .......

    News Round-up 18 December 2012

  • Downgraded ABCP remains investable

    Investors continue to buy the US and EMEA ABCP programmes downgraded from P-1 toP-2 in 2012, Moody's reports. For sponsors and sellers, many of the downgraded ABCP programmes remain attractive funding platforms, the agency says.

    Moody's notes that bank downgrades rather than asset deterioration drove the ABCP downgrades. "Although ABCP has traditionally been structured and marketed as a P-1 product, .......

    News Round-up 18 December 2012

  • Mexican equipment ABS critiqued

    Fitch says that several recent Mexican equipment lease ABS have credit risks that may not have been adequately addressed. The agency is therefore concerned about recent transactions coming to market that carry a triple-A national scale rating from other credit rating agencies.

    Fitch highlights three key credit concerns: small, lowly-rated sponsors securitising a large portion of their balance sheet; the .......

    News Round-up 18 December 2012

  • Stable outlook for ABCP

    The global ABCP market continues to prove resilient in the face of adversity, according to Fitch, having weathered an onslaught of market disruptions and regulatory challenges over the past few years. In the agency's view, at more than US$300bn, global ABCP outstandings remain a sizable force in the short-term capital markets and a valuable offering from both issuer and investor .......

    News Round-up 17 December 2012

  • Strengthening performance forecast for US SF

    Strengthening performance and issuance tailwinds in most US structured finance sectors are likely to push growth further in 2013, according to Fitch. However, one key area to watch in the coming year will be the potential drag created by fiscal cliff-related issues.

    "Securitisation re-established its importance to the global capital markets in 2012 and we expect this positive trajectory to .......

    News Round-up 14 December 2012

  • Slowing improvements drive credit card outlook

    Moody's has changed its outlook for US credit card ABS to stable from positive as collateral improvements slow.

    "Our outlook for the sector was positive in 2012 based on the expectation that collateral performance would see a significant decline in charge-offs, which occurred," says Moody's avp - analyst Gregory Gemson. "For 2013, we expect only slight improvements in charge-offs, which .......

    News Round-up 13 December 2012

  • Credit chief takes over ABS fund

    Simon Finch, credit cio at CQS, has replaced Alistair Lumsden as fund manager for the CQS ABS Fund. He will lead a team of 11 professionals in New York and London, where he is based. Finch has spent almost five years at CQS and was previously head of ABS at Abbey National.

    .......

    Job Swaps 12 December 2012

  • Lower quality, higher issuance for auto ABS

    The credit quality of US auto ABS will decline marginally in 2013, reflecting lenders' gradual return to higher but reasonable levels of risk taking, according to Moody's 2013 outlook for the sector. The agency also projects higher issuance, driven by investor demand to satisfy a need for short-term cash surrogate investment, as well as a need for yield from deeply .......

    News Round-up 12 December 2012

  • 2013 Euro ABS credit quality up, issuance down

    The credit quality of new European ABS and RMBS issuance in 2013 will be better than that of existing transactions, expects Moody's. However, deals will be smaller and that will affect issuance volume for the year ahead.

    The agency adds that the performance of existing transactions will be correlated to sovereign strength, with asset performance being stable in highly-rated countries .......

    News Round-up 10 December 2012

  • Timeshare delinquencies normalising

    US timeshare ABS delinquencies for 3Q12 were largely in line with those seen in the quarter before, says Fitch. Delinquency trends have largely normalised at their historical levels following dramatic increases in 2008 and 2009.

    The agency's latest timeshare index results show delinquencies for the quarter were 3.28%, down very slightly from 3.29% the quarter before. Delinquencies for the same .......

    News Round-up 10 December 2012

  • CRA 3 concerns highlighted

    A recent Reed Smith memo highlights three areas of concern for the securitisation industry with CRA 3 - rating agency rotation, public disclosure and civil liability (see also SCI 16 August). The European Council has published what may be the final form of the second amendment to the rating agency regulation, confirming that it will assent to it becoming effective .......

    News Round-up 6 December 2012
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