ABS
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Inaugural online auto ABS prepped
Sector developments and company hires
Online auto ABS debuts
Carvana, an online platform for buying used cars launched in 2012 by DriveTime Automotive Group, is marketing an inaugural securitisation. The US$338m transaction, dubbed Carvana Auto Receivables Trust 2019-1, comprises seven classes of notes provisionally rated by KBRA as triple-A on the class A1 and A2 notes, through to double-B on the class E notes.
According ......
Market Moves 15 March 2019Premium Content
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Servicing strength
Debut Spanish NPL securitisations anticipated
The Spanish non-performing loan market is reaching maturation, with the first securitisations from the sector expected this year. Developing an appropriate servicing capacity in the country has played a key role in facilitating this process.
“The fact that we envisage securitisation issuance going forward is a consequence of the maturity of the Spanish NPL market,” observes Antonio Casado, ......
News Analysis 15 March 2019Premium Content
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'Steady stream' of STS deals needed
Market reacts positively to inaugural STS ABS
The market has generally reacted positively to the news that Volkswagen’s VCL 28 auto lease ABS transaction is the first ABS to receive the STS label. Some participants note, however, that more STS-verified transactions are needed to give the European sector the boost it needs after months of subdued activity.
Rabobank’s ABS analysts comment that VCL 28 .......
News 14 March 2019
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Mixed performance
Semi-annual NPL securitisation update debuts
Moody’s has published the first in a series of semi-annual updates on European non-performing loan securitisations, which shows that six out of eight Italian NPL securitisations it has rated that have performance history are exhibiting cumulative gross collections around or below those anticipated by their business plan, while two exceed it. Cumulative gross collections for the Evora Portuguese NPL .......
News 14 March 2019
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Formative stages
Greek NPL momentum continues
Of the investors surveyed in Ashurst’s latest global non-performing loan report, 39% state that they have already invested in Greece - a higher percentage than anticipated, given that the Greek market remains in its formative stages. This figure may be indicative of investors having acquired assets in Greece under single-name transactions or other smaller private transactions. Nonetheless, appetite remains .......
News 13 March 2019
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Auto ABS looks set to receive first STS verification
Sector developments and company hires
Auto ABS looks set to receive first STS verification
The first European ABS that looks set to receive STS verification, by True Sale International’s STS Verification International, is being marketed by Volkswagen. The €719.9m auto lease ABS transaction is dubbed VCL Multi-Compartment, Compartment VCL 28 and is provisionally rated by Moody’s and Fitch as Aaa/AAA on the €705.7m class A notes .......
Market Moves 13 March 2019
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UMBS trades to be accepted
Sector developments and company hires
UMBS trades to be accepted
In support of the Single Security Initiative, Fannie Mae will begin accepting forward Uniform Mortgage-Backed Security trades with a trade date on or after 12 March, 2019 and settlement dates on or after 3 June, 2019. The announcement follows confirmation on 7 March, 2019 from SIFMA that their To-Be-Announced (TBA) Guidelines Advisory Council approved revisions .......
Market Moves 12 March 2019
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Bright spot
European ABS market update
De Lage Landen’s newly mandated UK equipment lease ABS represents a bright spot in an otherwise “dull” European securitisation market. Both primary and secondary activity appear muted so far this week.
Investor meetings for the £410m DLL UK Equipment Finance 2019-1 were set for yesterday and today. “The DLL deal is a bit different and brings some much-needed .......
Market Reports 12 March 2019
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R-PACE rulemaking proposals outlined
Sector developments and company hires
Credit line secured
Foundation Home Loans has entered into a new £350m warehouse credit line with National Australia Bank to support the origination of new mortgages. The lender has also extended an existing warehouse, funded by Natixis and SMBC, by £100m.
ILS
Descartes Underwriting has hired Edern Le Roux as head of ILS and cat modelling. .......
Market Moves 11 March 2019
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Servicing boost
Intrum augments Greek presence
Intrum is planning a purchase of a Greek debt servicing platform, which will act as a springboard for further non-performing loan transactions. However, it’s unclear whether the decision involves acquisition of a licensed debt servicing platform or setting one up from scratch.
“It could be either. If we can find the right platform to purchase that would be .......
News 8 March 2019
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Merger opposed
Company hires and sector developments
Astra case development
Judge Jennifer Frisch of the Minnesota District Court, Second Judicial District, has denied Goldman Sachs’ motion to dismiss the claims asserted against it by Kasowitz Benson Torres, on behalf of its client, Astra Asset Management, seeking termination of the Abacus 2006-10 synthetic CDO. The case is proceeding with discovery, with trial scheduled for October .......
Market Moves 8 March 2019
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Isolation issues
DLT legal, operational challenges highlighted
A number of legal and operational issues still need to be resolved before blockchain securitisations are likely to be publicly rated. How distributed ledger technology will isolate securitised assets is one major challenge.
Of the five key rating factors that make up S&P’s analytical framework, for example, the agency highlights legal/regulatory and operational/administrative risks as the areas most .......
News Analysis 8 March 2019
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Stronger tone
European ABS spreads tighten but supply muted
There is a stronger tone in the European ABS market overall and there has been spread tightening across the board, from RMBS to CLOs. Supply is still low, however, especially in ABS.
A trader says that a number of issuers in Europe are "ready to go", but they are still holding back as they await clarification around STS. The trader notes, .......
Market Reports 8 March 2019
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CDS reforms proposed
Company hires and sector developments
Australia
Mortgage House has hired Steven Mixter as head of securitisation and structured finance. He was previously head of funding at Latitude Financial Services, responsible for maintaining its securitisation funding programmes.
CDS reform proposal
An ISDA working group has been discussing proposals to amend the 2014 ISDA Credit Derivatives Definitions to address issues relating to narrowly tailored credit events (NTCEs). NTCEs are arrangements with .......
Market Moves 7 March 2019
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Creative approach
Definition of CRT criteria evolving
As the drivers for banks to pursue risk transfer transactions have broadened over the last few years, lending criteria for the underlying assets have in turn become increasingly complex. Consequently, for structured or esoteric portfolios, capital relief trade issuers and investors are adopting a more creative approach to defining eligibility criteria and replenishment conditions.
A standard capital relief ......
News Analysis 7 March 2019Premium Content
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Deleveraging deal
Bari SRT performance consistent with expectations
Scope has determined that the performance of Banca Popolare di Bari’s last significant risk transfer transaction with the EIF (SCI 17 August 2018) has remained within its expectations. The sequential deleveraging of the transaction offsets the loss potential from a growing delinquency pipeline for the rated tranche, according to the agency.
The financial guarantee provided by the EIF to .......
News 6 March 2019
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CRE investor bulks out
Company hires and sector developments
CDX-linked ETF launched
Tabula has launched a new ETF, dubbed Tabula European iTraxx Crossover Credit Short UCITS ETF (EUR), providing short exposure to high yield European corporate credit. It takes exposure via iTraxx Crossover five year which references 75 equally weighted, sub-investment grade entities.
Digital asset platform bulks out
GetLoci, the global platform offering non-custodial, self-minted assets backed .......
Market Moves 5 March 2019
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Line-up finalised
CRT event to include two workshops
The line-up for SCI’s 3rd Annual Risk Transfer & Synthetics Seminar on 12 March has been finalised. Hosted by Clifford Chance at 31 West 52 Street, New York, the event features for the first time two workshop sessions – one on creating structural common ground between capital relief trade investors and issuers; the other on how Basel 4 .......
News 5 March 2019
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STS synthetics pending
EBA to publish report by year-end
The EBA is expected to publish a report on STS synthetic securitisations by year-end, which will then be reviewed by the European Commission. The main challenges that the supervisor will be dealing with are the lack of performance data on synthetic securitisations and the creation of STS criteria for the sector.
STS criteria for synthetic securitisations could further ......
News Analysis 1 March 2019Premium Content
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Downward drift
Low default trend continues
Global corporate defaults fell in 2018 in advanced markets and were stable in emerging markets. The persistence of the low default trend - in particular, in advanced economies - is a positive sign for capital relief trades, given that the bulk of these transactions reference European corporate loans.
The default rate for non-financial corporates with rated debt in .......
News 1 March 2019
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New fund for CDS recruit
Company hires and sector developments
ABL acquisition
Market Moves 28 February 2019
Benefit Street Partners affiliate Business Development Corporation of America has acquired a controlling interest in asset-based lender Siena Capital Finance from Solaia Capital Advisors. Siena was founded in 2012 by an ABL team backed by Solaia consisting of professionals from Bank of Ireland subsidiary Burdale Capital Finance. Siena will operate independently as a portfolio company of BDCA, with .......