ABS
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Supply issues
STS volumes concentrated in auto loans
Of the securitisation asset classes that qualify for STS status, auto loan ABS is where the label has been applied most frequently. In contrast, mortgage collateral is often diverted to support covered bond issuance or STS RMBS are retained.
Consumer and auto loan ABS, as well as prime and buy-to-let RMBS are eligible for the STS label. However, .......
News Analysis 23 February 2021
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Irish NPE portfolio offloaded
Sector developments and company hires
Irish NPE portfolio offloaded
AIB Group is set to sell a non-performing loan portfolio in long-term default to Mars Capital Finance Ireland as part of a consortium arrangement with Mars and affiliates of Apollo Global Management. At completion, AIB will receive a cash consideration of approximately €400m.As at September 2020, the loan portfolio had a gross NPE value .......
Market Moves 22 February 2021
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Galaxy securitisation finalised
Alpha and Davidson Kempner sign deal
Alpha Bank has signed a definitive agreement with Davidson Kempner with respect to its €10.8bn Galaxy portfolio (SCI 24 November 2020). The deal is the second largest rated non-performing loan securitisation in Europe and will reduce the lender’s NPE and NPL ratio in Greece by 24% and 13% respectively.
According to the terms of the transaction, Alpha .......
News 22 February 2021
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Small balance UK CMBS prepped
Sector developments and company hires
Small balance UK CMBS prepped
Together Commercial Financial Services is marketing an unusual securitisation backed by small balance commercial assets. Dubbed Together Asset Backed Securitisation 2021-CRE1 (TABS 2021-CRE1), the £328.8m transaction is backed by 1,482 loans provided to 1,399 borrowers.The average outstanding principal balance per borrower is £235,020 and approximately 41.9% of the underlying properties are either fully .......
Market Moves 19 February 2021
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Private role?
Benefits of tokenisation weighed
As investment trends shift more towards private financings, tokenisation could play an important role in facilitating transactions. However, obstacles remain to a more widespread adoption of blockchain technology.
“A small revolution is going on that could significantly improve the investment process in the private industry, in particular. As the focus is shifting from public financing to private financing, .......
News Analysis 19 February 2021
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Forgive and forget
Student loan forgiveness heralds widespread prepayment in student loan ABS, but is credit positive
Some form of student loan forgiveness now looks likely to happen, and the effects upon the Federal Family Education Loan Program (FFELP) ABS market will be considerable, as a large percentage of bonds in circulation will be paid down.
“We estimate loan forgiveness of $10,000 per borrower could result in 22% of the outstanding balance of FFELP loans .......
News Analysis 18 February 2021
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NDBI risk eyed
Economic resilience bonds in the works
Political risk and social volatility became headline news last month, with the storming of the US Capitol. One firm is attempting to connect such non-damage business interruption risks to the capital markets via ILS structures.
“Over the last decade, I’ve become increasingly interested in political risk and social volatility as a function of the internet. Technology has been .......
News Analysis 18 February 2021
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'Unique' CLN deal readied
Sector developments and company hires
‘Unique’ CLN deal readied
Market Moves 17 February 2021
JPMorgan Chase Bank (JPMCB) is prepping the debut CLN issuance from the JPMorgan Wealth Management Mortgage (JPMWM) platform to transfer credit risk to noteholders through a hypothetical tranched CDS on a reference pool of mortgages. Dubbed JP Morgan Wealth Management Reference Notes Series 2021-CL1, principal payments on the notes are based on the performance of a US$2.36bn .......
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Seasonal effects
Servicer boost for Italian NPL collections
Seasonality effects gave Italian non-performing loan collections a significant boost for the second year in a row, even though Italy went into a second lockdown in November. Volumes were 71% higher in December 2020, similar to the 77% rise seen in December 2019, when comparing respective April-to-November averages.
However, according to Scope Ratings, December 2020 collections were still .......
News 17 February 2021
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Maritime financing facility agreed
Sector developments and company hires
Maritime financing facility agreed
Market Moves 16 February 2021
Maritime and offshore alternative capital provider Fleetscape Capital has entered into an innovative financing structure with Macquarie that provides a more efficient offer to vessel owners seeking higher leverage situations. The structure utilises securitisation principles and enables Fleetscape to provide sale-and-leaseback or unitranche financing on competitive terms. Coupled with Fleetscape’s transaction execution capabilities and streamlined documentation, the .......
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MBIA litigation settled
Sector developments and company hires
MBIA litigation settled
MBIA Insurance Corporation has entered into an agreement to settle the litigation it filed in 2009 against Credit Suisse and certain affiliated entities (SCI passim). The settlement follows a post-trial decision by the Court awarding MBIA Corp approximately US$604m in damages and, pursuant to the settlement, Credit Suisse has paid MBIA Corp US$600m.This amount materially .......
Market Moves 15 February 2021
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Consumer SRT prints
Santander finalises capital relief trade
Santander has priced Santander Consumo Four, its latest full-stack capital relief trade. Backed by a €1.5bn Spanish consumer loan portfolio, the transaction is significant for its size and can only be matched by a German full-stack deal that the lender completed in October 2020 (SCI 29 January).
Rated by DBRS and Moody’s, the transaction consists of €1.26bn .......
News 15 February 2021
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UKML tender offers mooted
Sector developments and company hires
UKML tender offers mooted
Market Moves 12 February 2021
Coventry Building Society subsidiary Godiva Mortgages is set to purchase from UK Mortgages Corporate Funding two buy-to-let mortgage portfolios originated by Godiva and currently financed within the Cornhill No. 6 and Malt Hill No. 2 RMBS vehicles. Subject to successful completion, the timing of these sales is expected to coincide with the transactions’ payment dates in .......
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EIF supports impact lending platform
Sector developments and company hires
EIF supports impact lending platform
Market Moves 11 February 2021
Tikehau Capital has completed the first closing for its private debt impact lending investment platform, raising circa €100m from the EIF - backed by the European Commission’s Investment Plan for Europe - as anchor investor, alongside other key institutional investors. Tikehau Capital intends to contribute to a sustainable European economy while providing investors with competitive .......
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UK industrial CMBS prepped
Sector developments and company hires
UK industrial CMBS prepped
Bank of America is in the market with a £340.1m CMBS sponsored by Blackstone. Dubbed Taurus 2021-1 UK, the transaction is backed by a two-year floating rate loan (with three one-year extension options) secured by the borrower’s interests in 45 industrial assets across the UK totalling 4.1 million square-foot of floor area.The largest asset .......
Market Moves 10 February 2021
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ILS innovation
UK platform to support additional capacity, emerging risks
London Bridge Risk PCC is the first UK ILS structure that has the PRA’s approval for use for multiple, market-wide transactions (SCI 14 January). The platform can be used for investors to support underwriting at Lloyd's through acquiring ILS.
“This platform - which has been sponsored by Lloyd's but is independent of the Society - can be .......
News Analysis 10 February 2021
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Special situations strategy launched
Sector developments and company hires
Special situations strategy launched
Bardin Hill Investment Partners has announced the final close of the Bardin Hill Opportunistic Credit Fund and a parallel side-car vehicle, with total commitments of approximately US$600m. The firm’s flagship closed-end strategy received backing from new institutional investors globally, as well as from existing Bardin Hill clients.The strategy identifies and executes on stressed, distressed, .......
Market Moves 9 February 2021
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Constructive outlook
Deborah Shire, global head of structured finance at AXA Inve...
Q: What were the drivers behind restructuring the AXA IM business into two key divisions – the Alts unit and the Core unit?
The Structured Credit Interview 9 February 2021
A: The business was restructured in March last year (SCI 11 March 2020), with the objective of developing two strategic businesses and boosting the commercial momentum behind them. The aim was to create a dedicated salesforce .......
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Lockdown exposure gauged
Geographic footprint to shape pub performance
The estate securing the Mitchells & Butlers Finance transaction has the most diversified geographic footprint of the UK pub whole business securitisations S&P rates, while Marston’s Issuer’s is the least diversified. Approximately 56% of the Marston’s pub estate is spread across the East and West Midlands, with additional pockets in the North West, Yorkshire and the Humber, according to .......
News 9 February 2021