ABS

  • Juicy CRT

    Historical wides entice fast money

    Spread levels in GSE CRT securities at the bottom end of the capital stack are now so cheap relative to comparable ABS assets that they are attracting attention from hedge fund and private equity money, say analysts.

    Five-year B2 notes are currently priced close to 1100bp over SOFR, more than twice the levels at which high yield ABS .......

    News Analysis 18 May 2022

  • New path

    Mexican securitisation marks firsts for StepStone

    Global private markets firm StepStone has structured a US$102.5m public offering of a securitised portfolio of direct loans via Certificados Bursátiles Fiduciarios on Mexico’s BIVA stock exchange earlier this year. Significantly, the transaction represents the first securitisation in Mexico of a portfolio of direct loans granted to North American companies, as well as the first time that StepStone acted .......

    News 16 May 2022

  • 'Investor-friendly' features introduced

    Sector developments and company hires

    Rising interest rates and widening spreads have spurred changes in US non-prime RMBS structures that introduce investor-friendly features for senior noteholders, Fitch reports. The move comes amid growing concern over coupon cap shortfalls and lower availability of excess spread.

    As such, many issuers have reduced the aggregate servicing fee to 25bp (which historically has been 50bp), while some have introduced .......

    Market Moves 11 May 2022

  • ITRN 'club deal' debuts

    Sector developments and company hires

    NN Investment Partners (NN IP) has launched the first vintage of a customised solution to invest in trade finance through its Insured Trade Receivables Notes (ITRN) strategy. Structured as a club deal and delivered via a mutual debt vehicle (a fonds commun de titrisation), the offering was specifically designed for a group of high-profile insitutional investors in France, with initial .......

    Market Moves 9 May 2022

  • MSCI and MarketAxess collaborate

    Sector developments and company hires

    MSCI has announced its entry into a strategic collaboration with MarketAxess to establish new portfolio analytics solutions and fixed income indexes. The two firms hope to improve the fixed income investment process, empower investors, and drive innovation through their collaboration by developing portfolio optimisation, trading, and analytics tools. The collaboration will rely on MarketAxess’ fixed income indexes and AI-informed pricing .......

    Market Moves 29 April 2022

  • A buyer's market

    European ABS/MBS market update

    Following a flurry of deal announcements (SCI 22 April 2022), the primary European and UK ABS/MBS markets were extensively testing investor demand during the week. With so many deals to absorb, deal performance has been disparate.

    In a context of large volumes of paper, UK RMBS transactions were playing a central role with four transactions hitting the market. On .......

    News Analysis 29 April 2022

  • Fasten your safety belts

    Aircraft ABS set for further turbulence

    The fallout from the Ukraine crisis is likely to affect the entire aircraft ABS market, rather than simply those deals with exposure to Russian assets. This Premium Content article outlines why the sector is bracing for a bumpy ride.

    The Russia-Ukraine conflict has exposed fault lines in the aircraft ABS market that participants had hitherto tended to .......

    News Analysis 22 April 2022

  • Ex-employees resurrect Highland

    Sector developments and company hires

    Ex-employees resurrect Highland
    A trio of former senior Highland Capital Management portfolio managers have resurrected the firm under a new moniker, Highland ERA Management. Patrick Daugherty – who was partner, senior CLO portfolio manager and head of distressed/special situations at Highland – is partnering with ex-Highland team members Kevin Rourke and Niles Chura in the venture.

    Through a sub-advisory .......

    Market Moves 22 April 2022

  • Full steam ahead

    European ABS/MBS market update

    With seven deals marketing, the European and UK primary ABS/MBS markets are set for bustling days ahead. While the market remained relatively unmoved either side of the Easter break, this strong surge in deals all scheduled for next week will certainly test investors’ appetite.

    “With so many deals being announced, the doors are clearly open,” notes one European .......

    News 22 April 2022

  • New name

    Dutch auto lease ABS debuts

    Hiltermann Lease is in the market with a rare Dutch auto ABS. The lender’s inaugural transaction, dubbed Hill FL 2022-1, is backed by a €500m pool comprising 33,744 financial lease contracts to 30,896 lessees (see SCI's Euro ABS/MBS Deal Tracker).

    The assets were distributed through dealers to self-employed and commercial borrowers to finance the purchase of new (accounting for .......

    News 20 April 2022

  • Finding funding

    European solar ABS tipped for acceleration

    Securitisation could play a vital role in funding the European energy transition, with households likely to bear the brunt of the switch to renewable energy. As the Ukraine conflict continues to raise concerns over Russian energy dependency across Europe, the development of a solar ABS market in the region is expected to accelerate.

    Following on from forced sustainable .......

    News Analysis 14 April 2022

  • Dutch courage

    European ABS/MBS market update

    The European and UK ABS/MBS markets are looking to take full advantage of a recent surge in activity. This week, with a number of deals due to price, the market will try to maintain its strong momentum into the Easter break.

    After feeling the full effects of macro volatility, the European and UK ABS/MBS markets have over the .......

    News 12 April 2022

  • Hellenic ABS inked

    Project Starlight package transaction agreed

    Hellenic Bank has agreed a package transaction involving the securitisation of the Starlight Portfolio – which comprises circa €1.32bn of non-performing exposures - and the sale of its servicing platform, APS Debt Servicer, to Oxalis Holding. Upon completion, the agreement will de-risk the bank's balance sheet by reducing NPEs by €720m, resulting in a residual NPE portfolio of circa .......

    News 11 April 2022

  • Perfect storm

    Cat bond market set for exponential growth?

    With the climate threat menacing ever more, is the catastrophe bond market set to see exponential growth? This Premium Content article investigates.

    This year, the catastrophe bond sector reached a landmark anniversary, marking 25 years since its inception. This follows record levels of issuance in 2021, with the market seeing volumes of US$12.5bn, surpassing the previous record of US$11bn ......

    News Analysis 11 April 2022

    Premium Content

  • Dual shocks

    Securitisation well positioned to withstand headwinds

    The Covid-19 shock has been replaced by two others - war and worse-than-expected inflation (SCI 7 April). However, the securitisation market appears to be well positioned to withstand these headwinds.

    “We came into the year coming out of one shock – pandemic - only to be hit by two others: worse-than-expected inflation and now war. Those new shocks are .......

    News Analysis 8 April 2022

  • Stag night

    US ABS in good place to absorb impact of raging inflation

    Even if the US economy were to plummet into stagflation, the ABS market will suffer only minor negative ratings consequences, according to analysis conducted by Fitch.

    There would be virtually no effect on ratings in 67 out of the 78 sub-sectors reviewed, it says.

    The bulk of ABS deals were well-positioned at the start of this year in terms of the strength of .......

    News 7 April 2022

  • Mind the gap

    Alternative data, RMBS to help address wealth inequality

    Securitisation could prove a useful tool in addressing the growing wealth inequality gap. Indeed, the technology is already channelling capital towards underserved communities, aided by CDFI-backed RMBS and alternative data being used to calculate credit scores.

    Elen Callahan, head of research at the Structured Finance Association, believes that the use of alternative data to assess consumer credit scores .......

    News Analysis 6 April 2022

  • Cautious optimism

    European ABS/MBS market update

    Following a clear pick-up in activity last week, the European and UK primary ABS/MBS markets have carried over that dynamism into this week. Optimism is, it seems, back on the cards for now.

    “Well, I think things are much more positive,” states one European ABS/MBS trader. “We have seen a big turnaround in the market, where a lot .......

    News 1 April 2022

  • Robotic revolution

    QSR innovation continues to bolster WBS performance

    Issuers of quick-service restaurant (QSR) whole business securitisations adopted a number of strategies to survive the Covid-19 pandemic. As trends towards off-premise dining and delivery continue to produce increased revenue, these strategies are expected to continue supporting performance across the segment.

    US QSR WBS issuance last year increased by 88% from 2019 and by a total 300% compared .......

    News Analysis 1 April 2022

  • Quality control

    Call for ESG data improvements

    The lack of clear, unified standards continues to constrain the wider adoption of ESG securitisation in the EU. In order to fulfill investor demand for such product, both the quality and quantity of ESG data needs to improve, according to panelists at SCI’s recent ESG Securitisation Seminar.

    Andrew Lennox, portfolio manager at Federated Hermes, pointed out that pricing .......

    News Analysis 30 March 2022

  • Guarantee on tap

    WBS liquidity facility replaced

    Assured Guaranty UK (AGUK) has issued a £170m five-year debt service reserve (DSR) guarantee to benefit Yorkshire Water Services, part of the Yorkshire Water group. The guarantee was structured to fit within Yorkshire Water Services’ existing whole business securitisation and comes as banks increasingly retreat from providing securitisation liquidity facilities.

    The securitisation requires a debt service facility to .......

    News 30 March 2022
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