ABS
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Securitisation tax consultation underway
Sector developments and company hires
Securitisation tax consultation underway
The UK HMRC has launched a consultation seeking views on the taxation of securitisation companies. The UK government says it has identified - through ongoing dialogue with the industry - areas where it may be beneficial to make changes to such tax regulations and is therefore keen to explore the associated benefits and potential difficulties.Market Moves 24 March 2021
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Red Cross in humanitarian cat bond first
Sector developments and company hires
Red Cross in humanitarian cat bond first
Market Moves 23 March 2021
The first-ever humanitarian catastrophe bond covering pure volcanic eruption risk has been completed using a Guernsey ILS structure. Sponsored by the Danish Red Cross, the US$3m issuance was privately placed by Replexus and Howden Capital Markets via Dunant Re IC, an incorporated cell of Replexus ICC (Guernsey), which is managed in Guernsey by .......
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CLO fallback language reviewed
Sector developments and company hires
CLO fallback language reviewed
S&P has reviewed the indentures of the 870 CLOs it rates to assess Libor fallback language governing a transaction's liabilities. The majority (76%) of its rated CLO transactions closed between 2018 and 2020.ARRC-like fallback language can be found in 26% of the agency’s overall transactions, including 76% of the transactions that closed in 2020. .......
Market Moves 22 March 2021
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Landmark NPL ABS inked
Banca Ifis completes salary assignment securitisation
Banca Ifis has finalised a securitisation backed by a €1.3bn non-performing loan portfolio in gross book value terms. The transaction is the first Italian NPL ABS to be secured directly by salary and pension assignment loans.
Rated by Moody’s and Scope, the transaction consists of €158.7m A2/A- rated class Ax notes, €206.2m A2/A- rated class Ay notes, €74.4m B2/B+ rated class .......
News 22 March 2021
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The Collins catalyst
Dodd-Frank amendment could provide tipping point for US CRTs
The take-off of the US capital relief trades market has been predicted for several years. This CRT Premium Content article explores whether the increasingly onerous impact of the Collins Amendment could provide the tipping point.
This amendment to the 2010 Dodd-Frank Act, named after Senator Susan Collins of Maine, requires US banks that are entitled to use their own ......
News Analysis 22 March 2021Premium Content
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MPL acquisition to accelerate auto financing
Sector developments and company hires
MPL acquisition to accelerate auto financing
Market Moves 19 March 2021
Upstart Holdings is set to acquire Prodigy Software, a provider of cloud-based automotive retail software. Upstart says it is seeking to reduce the cost of auto financing by creating a modern multi-channel purchase experience. Auto retail is among the largest buy-now-pay-later opportunities, according to the firm, and together with Prodigy it aims to help .......
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Record breakers?
Chart-topping CRT issuance volumes anticipated
The capital relief trades market is set to break issuance records in 2021 after a challenging 2020, as banks seek ways to improve their return on equity and following pent-up issuance from last year. In this CRT Premium Content article, we examine the conditions that the coronavirus crisis has laid out for a surge in risk transfer volumes this ......
News Analysis 19 March 2021Premium Content
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Chip shortages 'credit positive' for auto ABS
Sector developments and company hires
Chip shortages ‘credit positive’ for auto ABS
Market Moves 18 March 2021
Sizable auto production cuts due to semiconductor shortages in the US will provide support for used vehicle values, a credit positive for securitisations and captive auto finance companies, according to Moody’s. The rating agency notes that such shortages – which are expected to last at least into next quarter - could result in North .......
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Legislative hoops
Multiple layers of regulatory assent hinders US CRT development
Texas Capital Bank confirmed last week that it sought approval from three different US regulators before selling its debut capital relief trade (SCI 12 March). For many banks, this process represents a deterrent to issuance.
The OCC, the US Fed and the FDIC all had to give the thumbs up to TCDI before it felt able to .......
News Analysis 17 March 2021
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'Unprecedented' Moroccan CRT closed
Sector developments and company hires
‘Unprecedented’ Moroccan CRT closed
Market Moves 16 March 2021
Moroccan fertiliser giant OCP Group has subscribed to the notes issued by the first synthetic securitisation in Morocco. The transaction involved the establishment of a collective securitisation vehicle dubbed Fonds Damane Tamayouz, which has been structured to facilitate access to credit for the suppliers that make up OCP's industrial ecosystem.
Clifford Chance, which advised on the deal, .......
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Diversification play
MPL platforms broadening product offerings
The consumer loan marketplace lending ABS segment has proved to be resilient through the coronavirus-induced downturn. However, concerns are emerging regarding how performance might change after stimulus and borrower relief measures come to an end in the US.
“KBRA placed many ratings in the sector on watch at the onset of the pandemic; however, due to favourable performance .......
News Analysis 15 March 2021
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Defence Bank debuts Aussie RMBS
Sector developments and company hires
Defence Bank debuts Aussie RMBS
Defence Bank (DBL) is prepping its inaugural public Australian prime RMBS, the A$300m DBL Funding Trust No. 1 Salute Series 2021-1. DBL provides financial products and services to members of the Australian Defence Force (ADF), as well as the broader community.DBL is one of three lenders selected to provide home loans to ADF .......
Market Moves 15 March 2021
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Collection hitch
January NPL collections fall
Italian non-performing loan collections in January have plunged, following a December boost (SCI 26 February). Given a third pandemic wave that is about to hit the Italian economy, NPL ABS collections are still 46% below pre-Covid levels - a trend that is not expected to revert in the medium term.
According to Scope Ratings, January collections were .......
News 12 March 2021
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Third wheels
JPMorgan takes to the road again with another auto-linked credit note
JP Morgan Chase is to issue its third auto loan-linked CRT transaction in the last eight months, designated Chase Auto Credit-Linked Notes Series 2021-1, in another indication of the growth of the CRT market in the US.
The note references 161,885 reference obligations for a notional amount of $3.98bn.
The pool is composed of high quality credits, as is common for US CRT .......
News 11 March 2021
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BDC fair value assessed
Sector developments and company hires
BDC fair value assessed
On the back of tightening BDC spreads and growing investor interest, JPMorgan CLO research analysts have published a report aiming to assess fair value in the sector. In addition, they compare BDCs to their closest relative – middle market CLOs.“Differentiating between BDCs is a challenge; thus, we used attachment points as a reference point .......
Market Moves 11 March 2021
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ESG engagement underway
Sector developments and company hires
ESG engagement underway
Market Moves 10 March 2021
All EU-based open-ended funds managed by Leadenhall Capital Partners have been categorised as being investment products that promote environmental and social characteristics in accordance with the criteria recently set out in Article 8 of the EU’s Sustainable Finance Disclosure Regulation (SFDR). The firm says it has committed to embed ESG considerations in its investment process for a .......