ABS
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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
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Muskoka called
BMO exercises call option
Bank of Montreal has decided to call a capital relief trade backed by senior secured and senior unsecured US and Canadian corporate loans. Dubbed Muskoka Series 2017-2, the transaction was finalised in 2017 and was first eligible to be called in September 2020.
Capital relief trades often feature time calls, which allow banks to call their trades following .......
News 9 February 2021
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NPL SRT agreement inked
Sector developments and company hires
NPL SRT agreement inked
Hoist Finance has signed a co-operation agreement with Magnetar Capital that provides for new portfolio investments on a pan-European level and will create a framework for future purchases in the current regulatory environment. The aim is to make securitisation an integral part of a sustainable business model for Hoist and strengthen its purchase capabilities.The .......
Market Moves 8 February 2021
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Fly or goodbye - can airlines survive without taking to the skies?
Contributed thought leadership by Ocorian
As once profitable airlines look to survive and raise liquidity to weather the turbulence of the Covid-19 pandemic, Ocorian director Abigail Holladay and Watson Farley & Williams aviation partner Patrick Moore assess the use of alternative assets as a means to raise finance.
With airlines having lost an estimated US$118.5bn in 2020, it's easy to forget the aviation industry had been .......
Talking Point 8 February 2021
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Iberian NPL ABS performance eyed
Sector developments and company hires
Iberian NPL ABS performance eyed
Market Moves 5 February 2021
The cumulative collection ratio for the DUERO 1 non-performing loan securitisation has consistently breached its trigger level for an interest subordination event – which is set at 90% - since the April 2020 reporting period, according to JPMorgan’s latest Portuguese & Spanish NPL ABS Performance Tracker publication. After dropping to 68.4% in April from 106.1% .......
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Motor insurer preps ILS strategy
Sector developments and company hires
Motor insurer preps ILS strategy
Market Moves 4 February 2021
UK specialist motor insurer ERS Group is set to launch an integrated ILS offering as part of its plans to progress its commercial expansion. Three complementary investment strategies will be offered: an open-ended mandate with a remit to invest across both public, private and non-life ILS, with semi-annual liquidity; a closed-ended, higher risk and higher .......
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Credit manager merger
Sector developments and company hires
Credit manager merger
Market Moves 3 February 2021
Cairn Capital Group is set to acquire and merge with Bybrook Capital, a specialist distressed credit manager based in London. The merger will create a diversified alternative credit manager with approximately US$8bn in assets under management across public, private, performing and distressed investment opportunities. Through the transaction, Mediobanca will reaffirm its position as a majority shareholder in .......
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ABS at the races
Fundamental and technical factors power US ABS, led by autos
Fuelled by very healthy technicals and fundamentals, the US ABS market has entered 2021 at a gallop, led by the auto loan sector, agree ABS analysts.
Barring an unforeseen and drastic pandemic-related downturn, there is little to derail the market at the moment. Spread levels in many sectors are already at the lowest prints seen for a decade, but the market appears .......
News Analysis 29 January 2021
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PHEAA investor forum formed
Sector developments and company hires
PHEAA investor forum formed
Market Moves 29 January 2021
PHEAA has launched a series of consent solicitations seeking investor approval to amend the terms of indentures related to its outstanding tax-exempt bonds and notes issued by various PHEAA student loan ABS trusts, for which the organisation acts as administrator. The amendments would provide for the flexibility to sell the student loans pledged under certain indentures .......
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Positive prospects
Secondary CRT market gains traction
The coronavirus crisis has increased the prospects for a more active secondary market for capital relief trades. Nevertheless, relatively small clip sizes and a dearth of syndicated transactions means that it will be some time before activity matches last year’s all-time record.
According to investor data, approximately US$1bn notional in CRT paper was traded last year as the .......
News Analysis 28 January 2021
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Liquidity impact
Post-Brexit divergence highlighted
Liquidity is one area of concern following the UK’s withdrawal from the EU, given that UK securitisations are no longer considered eligible collateral at the ECB. Potential divergence over the revised retention regulatory technical standards is another.
“The ECB will look at EU deals and data templates. UK securitisations are no longer eligible collateral, which may impact liquidity. .......
News 28 January 2021
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UK social bond debuts
Sector developments and company hires
UK social bond debuts
Kensington is prepping its inaugural STS and what is believed to be the UK market’s first ESG RMBS. Dubbed Gemgarto 2021-1, the £472m transaction is labelled as a social bond and is backed by a pool of UK specialist prime, performing, first-ranking owner-occupied mortgages.The loans are made to underserved borrowers with complex incomes and .......
Market Moves 27 January 2021
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Mind the gap
Innovative ILS structures creating Asian capacity
MS Amlin’s recent Phoenix 1 Re deal marks the tenth catastrophe bond issued in Singapore (SCI 11 January). The transaction is also an example of how innovative ILS structures can help narrow the insurance protection gap in Asia.
Asia leads the world in economic growth but is also the continent that experiences the largest number of natural .......
News Analysis 27 January 2021
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Call for aircraft ABS protections
Sector developments and company hires
Call for aircraft ABS protections
Market Moves 26 January 2021
Fitch reports that a material number of aircraft failed to be novated to two aircraft ABS - START III and Lunar 2020-1 – last year, following closing. The failure of aircraft to novate in START III resulted in the asset count falling to just two aircraft from 19 initially, while six of 18 initial aircraft .......
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NPL pipeline builds
European asset disposals intensify
The European banking system’s disposal of non-performing loans intensified in 4Q20, particularly in December, closing the year at €38bn in NPLs sold. An additional €40bn of NPLs could be sold on the market in 2021, with around €30bn of this amount already announced for imminent disposal, according to the latest Banca Ifis Market Watch NPL report. Transaction volumes involving .......
News 26 January 2021
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CLO outlook updated
Sector developments and company hires
CLO outlook updated
Market Moves 25 January 2021
Fitch says it expects to change a significant portion of its CLO outlooks to stable from negative, following the revision of its CLO coronavirus stress scenario to assume half of the corporate exposure on negative outlook is downgraded by one notch instead of 100%. Approximately one-third of corporate issuers with loans in CLOs currently have a negative .......
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Litigation on the cards?
SLABS default rates causing concern
Rising US student loan ABS default rates have sparked concern among securitisation investors. In order to recover losses, investors may resort to lawsuits.
Philip Stein, partner and litigation practice group leader at Bilzin Sumberg, says: “Some uptick in litigation is likely as investors may want to use lawsuits, or at least the threat of lawsuits, as recourse to .......
News 22 January 2021
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