ABS

  • Diversification offered

    European ABS market update

    The European ABS pipeline is swelling in the run-up to March. Newly announced deals are providing sought-after diversification, not only in terms of assets but also jurisdictions.

    Notably, Domivest is in the market with its second Dutch buy-to-let RMBS. Dubbed Domi 2020-1, the transaction is backed by a provisional €340m pool consisting of 1,288  mainly interest-only mortgage loans .......

    Market Reports 28 February 2020

  • Brexit question

    UK and EU STS regimes could diverge

    The end of the Brexit transition period on 31 December 2020 will call into question the STS status of UK securitisations for EU investors and of EU securitisations for UK investors. At the moment, under the forthcoming UK STS regime, EU STS securitisations will benefit from a two-year grandfathering period after Brexit - although no equivalence for UK STS .......

    News Analysis 28 February 2020

  • MSR subservicing transfer agreed

    Sector developments and company hires

    EMEA
    Michael Fiebig has been appointed coo at responsAbility Investments. Fiebig will be responsible for the firm’s regional offices and central functions, such as legal, finance and business technology. Previously, he was responsible for private equity investments at responsAbility.

    MSR transfer
    Ocwen Financial Corp is set to transfer the subservicing of agency loans currently subserviced by its subsidiary PHH Mortgage .......

    Market Moves 27 February 2020

  • Green ILS framework rolled out

    Sector developments and company hires

    EMEA
    Nick Holman has joined Kartesia to lead investments in the UK from the Kartesia Senior Opportunities (KSO) I fund. Holman joins Kartesia from Santander’s structured finance team, where he was a director. He will work alongside Javier Castillo, Charles-Henri Clappier and Thomas Poehler in the KSO senior team.

    Green ILS framework
    Generali has developed a ‘Green Insurance Linked Securities .......

    Market Moves 26 February 2020

  • Project Cairo prepped

    Eurobank applies for HAPS guarantee

    Eurobank has applied to the Greek government for a senior tranche guarantee under the Hercules Asset Protection Scheme (HAPS). The guarantee is sized at €1.65bn and concerns two non-performing loan securitisations dubbed Cairo One and Two. Further applications are expected following a series of announcements of pending HAPS NPL ABS deals by Greek systemic banks (SCI 4 February).

    News 26 February 2020

  • GM withdrawal from Aussie autos 'credit negative'

    Sector developments and company hires

    CMBS analytics platform
    Thetica Systems has launched a web platform for CMBS pricing and analytics tools, which can be used to quickly analyse bid lists, gather market colour and perform deep analysis. Clients control the requirements for access to inputs and calculations.

    EMEA
    PGGM recently promoted Youssef Sfaif to the position of director, credit and insurance linked investments. The role .......

    Market Moves 25 February 2020

  • UK SRT debuts

    Opel prepping full-stack auto ABS

    BNP Paribas is marketing Opel’s second full-stack auto ABS from the E-CARAT programme. Dubbed E-CARAT 11, the capital relief trade is the issuer’s first to reference UK auto loans.

    Boudewijn Dierick, head of ABS markets at BNP Paribas, notes: “The residual value is the novelty and main challenge here, as different investors take different views on UK RV .......

    News 25 February 2020

  • Social factors

    Positive ESG scores for post-crisis vintages

    ESG relevance scores (ESG.RS) are more likely to be negative for seasoned securitisations, according to Fitch. The most recent issuance vintages demonstrate a balance of positive and negative ESG factors.

    Weak transaction structures prior to the crisis are identified as a factor contributing to the negative ESG.RS found in those vintages. In addition, Fitch says: “Some governance issues .......

    News 24 February 2020

  • High-profile bankers exit SRT

    Sector developments and company hires

    SRT departures
    Last week saw a couple of high-profile exits from SRT banking teams in London. Structuring specialist Jeremy Hermant is understood to have left Santander, while md Bob Paterson has reportedly been put at risk of redundancy at Lloyds.

    Spokespeople at both banks declined to comment, although the latter stated: “Whenever we make role reductions, these changes do require making difficult .......

    Market Moves 24 February 2020

  • Rare CMBS prepped

    BofA brings 'one-off' Dutch transaction

    BofA is in the market with a Dutch CMBS, dubbed Taurus 2020-1 NL. The €620.6m deal is the first from the programme to be backed solely by Dutch assets.

    Rated by KBRA, the transaction comprises €324.7m triple-A rated class A notes, €98.8m double-A minus rated class B notes, €65.9m single-A minus rated class C notes, €65.9m triple-B minus rated class .......

    News 24 February 2020

  • Moving down

    Insurers target first-loss CRTs

    Insurers are now targeting the first-loss tranches of capital relief trades, having eyed the senior mezzanine tranches of dual-tranche transactions last year (SCI 22 March 2019). The better risk/return profile of first-loss tranches and an adaptation of traditional credit insurance contracts into unconditional guarantee formats are the main factors driving the development.

    According to one reinsurer: “We have no .......

    News Analysis 21 February 2020

  • SRT fund launched

    AXA engineers return

    AXA Investment Managers has completed its eighth partner capital solutions fund. With the move, the firm is seeking to capitalise on diversification opportunities and volume growth in the risk transfer market.

    According to Deborah Shire, global head of structured finance at AXA Investment Managers: "The reg cap market has been transformed into a full-fledged alternative investment opportunity, with .......

    News 21 February 2020

  • Rarity value

    European ABS market update

    The European ABS market remains characterised by a lack of free flow. Against this backdrop, the senior notes of the Spanish Gedesco Trade Receivables 2020-1 transaction are attracting investor interest, due to its rarity value.

     “It is still very much the same tone. Generally, we are not seeing a huge amount of trading,” one trader notes.

    He .......

    Market Reports 21 February 2020

  • Minority equity interest acquired

    Sector developments and company hires

    Equity interest acquired
    Affiliated Managers Group has acquired a minority equity interest in Comvest Partners. The Comvest management team will be investing 100% of the transaction proceeds directly into future funds to support the firm’s growth initiatives. Following the transaction, the senior partners of Comvest will continue to own a significant majority of the equity of the business.

    HPI .......

    Market Moves 20 February 2020

  • Risk transfer round-up - 20 February

    CRT sector developments and deal news

    Further details have been revealed of CRT transactions that were completed in 4Q19. One is another Barclays deal from the Colonnade programme, which is a US$55m tranche that matures in December 2026.

    Lloyds also returned to the market with a third Wetherby trade. Dubbed Wetherby Securities 3 2019, it comprises two tranches sized at £49.5m and £36m (see ......

    News 20 February 2020

    Premium Content

  • C-PACE fund debuts

    Standalone platform leads origination

    Samas Asset Management (SAM) has launched its debut fund, a closed-end vehicle dubbed SAMAS FUNDING PACE FUND LLLP Series 2020. The Samas entities are now the ‘‘largest standalone commercial PACE origination platform in the US’’.

    The PACE bonds in this fund represent a diversified portfolio associated with small- and medium-sized commercial properties.

    ‘‘Projects that we finance generate .......

    News 20 February 2020

  • SME double

    EIF closes pair of EFSI guarantees

    The EIF has closed two new guarantee agreements supporting European SMEs, both of which are supported by the European Fund for Strategic Investments (EFSI). One is a synthetic securitisation executed with Commerzbank and the other is the extension of a COSME facility with Bank Gospodarstwa Krajowego (BGK).

    Under the first agreement, the EIB and the EIF have provided .......

    News 19 February 2020

  • Manager discretion

    Direct lending securitisations on the rise

    A growing number of direct lending funds are raising debt via securitisation of their shares. A carefully considered approach is needed when assessing the credit risk of such debt, however, given the large discretion managers have to build highly non-granular investment portfolios.

    Traditionally, direct lending funds have issued shares with equity-type properties to raise financing. But recent regulations .......

    News 19 February 2020

  • Distressed debt unit formed

    Oaktree establishes Chinese subsidiary

    Oaktree Capital Management has become the first foreign distressed debt manager to set up a wholly owned subsidiary in China as part of phase one of the US-China trade deal. The trade deal will allow US firms to apply for asset management company (AMC) licenses and hence purchase non-performing loans directly from Chinese banks.

    At the moment, foreign .......

    News 19 February 2020

  • MPL acquisition to achieve 'regulatory clarity'

    Sector developments and company hires

    Acquisition
    LendingClub is set to acquire Radius Bancorp and its wholly owned online subsidiary Radius Bank in a cash and stock transaction valued at US$185m. The combination of Radius and LendingClub is designed to create a digitally native marketplace bank at scale, with the power to deliver an integrated customer experience. The aim is to enable consumers to both pay less .......

    Market Moves 19 February 2020

  • Refinancing strategy

    VW master trusts augment auto ABS volumes

    VW’s issuance of auto ABS from master trust vehicles has been extensive, yet it seems to have largely gone unnoticed. The VCL Master vehicle alone has been tapped multiple times, for example, contributing around €2bn to European auto ABS volumes.

    As of 30 September 2019, Volkswagen’s Financial Services division (except the US and Canada) had an outstanding ABS .......

    News Analysis 19 February 2020
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