Complete news archive
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Long road ahead
CLO secondary pricing action premature?
Sentiment in the CLO secondary market is overwhelmingly positive, which is showing up in recent pricing levels. While such sentiment is hopefully not misplaced, it is perhaps somewhat premature.
“Markets are priced to perfection, which is reflected in the rally, particularly at the top of the stack,” says Laila Kollmorgen, md and CLO tranche portfolio manager at PineBridge Investments. “Clearly .......
News Analysis 3 June 2020
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More Euro CLOs on review
Sector developments and company hires
More Euro CLOs on review
Market Moves 3 June 2020
Moody’s has put a further 234 tranches from 77 European BSL CLOs on review for possible downgrade. The securities involved are rated Baa2 to B1 and below. The action brings the total number of European CLOs Moody’s has under negative review to 351, representing around 16% by count, or 6.5% by balance, of its rated .......
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NPL ABS prepped
Pancretan Bank readies Castor
Pancretan Bank is readying a non-performing loan ABS that references an approximately €1.1bn real estate-backed SME portfolio. Dubbed Project Castor, the transaction is one of a handful of Greek NPL securitisations launched during the coronavirus outbreak.
Pancretan Bank has carved out nearly €300m for sale, while the rest of the portfolio will also be awarded for servicing by .......
News 3 June 2020
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New paradigm?
Trustee discretion required in virtual environment
The coronavirus crisis ushered in a new paradigm for securitisation noteholder communication and documentation processes, as remote working was enforced. This change has demanded flexibility from trustees and agents amid the uncertainty.
Morgan Krone, partner and head of the global corporate trust and agency practice at Allen & Overy, says: “I think trustees and agents have done extremely .......
News Analysis 2 June 2020
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Managers measured
CLO manager pandemic performance quantified
US CLO managers have worked harder than ever before to reduce triple-C exposure and build par in unprecedented circumstances since the start of March. Now, as rating downgrades appear to have plateaued it can be seen that their industry has met with some success, according to a new report from S&P.
“The credit profile of US CLO collateral .......
News 2 June 2020
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Risk mitigation
Southern European RMBS 'insulated'
An increase in European RMBS delinquency rates is expected in the coming months, reflecting coronavirus-induced stress on borrowers. However, Southern European RMBS transactions have structural features and portfolio characteristics that are expected to mitigate the negative impact of the crisis.
Andrea Corda, avp at Moody’s, says: “Italian, Spanish and Portuguese RMBS we rate would largely weather a short, .......
News 1 June 2020
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Equity opportunities?
Sector developments and company hires
Equity opportunities?
Despite a lack of visibility and liquidity and with cashflows likely to deteriorate further into upcoming July payment dates, there may be some opportunities in the CLO equity space, according to a new research report from JPMorgan.It finds that while NAVs remain negative, there has been some improvement between March lows and late 2019. Equally, cashflow .......
Market Moves 1 June 2020
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SCI Start the Week - 1 June
A review of securitisation activity over the past seven days
Last week's stories
News 1 June 2020
Accessing guarantees
CBILS securitisation warehouses mulled
Forbearances falter
Forbearance volumes slow, but the next stage is daunting
Galaxy returns
Alpha relaunches NPL ABS
Growth phase
European CLOs seeing increasing attention to ESG criteria
Lift off
Hoist Finance answers SCI's questions
Marketplace merit
Online lending resilient amid impairments
Mobilising MILNs
The MILN market is in deep freeze but thaw might be due
Persistent opportunity
CDIB Capital .......
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Renewables JV inked
Sector developments and company hires
Renewables JV inked
Market Moves 29 May 2020
By way of a joint venture, illimity Bank and VEI Green II have set up a securitisation vehicle for distressed loans with underlying assets that produce electricity from renewable sources. This vehicle will invest up to €100m and operate in both the Italian primary and secondary energy markets. The partnership has commenced activities by carrying out its .......
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Galaxy returns
Alpha relaunches NPL ABS
Alpha Bank is relaunching its project Galaxy non-performing loan ABS following the coronavirus disruption, with the aiming of closing the securitisation in 4Q20. At the same time, the National Bank of Greece has postponed an NPL ABS deal that was initially scheduled for 3Q20.
The Galaxy securitisation was announced last year and references retail secured and wholesale non-performing .......
News 29 May 2020
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Forbearances falter
Forbearance volumes slow, but the next stage is daunting
The rate of increase of US home loans in forbearance plans has slowed significantly lately, according to data compiled by Black Knight, the mortgage technology and data provider, but the overall picture remains sobering.
Only 7,000 new mortgages were added to the overall total of 4.76m homeowners in forbearance plans in the week-ending May 26. This compares to a 325,000 net increase .......
News 29 May 2020
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Accessing guarantees
CBILS securitisation warehouses mulled
Securitisation is gaining traction as a way for a wider investor base to access coronavirus-induced government stimulus packages. The technology could also be leveraged to provide much-needed liquidity to SMEs.
Orrick partner Richard Hanson, for one, is aware of non-bank accredited lenders seeking to warehouse Coronavirus Business Interruption Loan Scheme (CBILS) loans via a private securitisation structure. Under .......
News Analysis 29 May 2020
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Risk transfer round-up - 29 May
CRT sector developments and deal news
ABN AMRO is rumoured to be readying a corporate capital relief trade that is expected to close in 3Q20. The transaction would be the lender’s first post-crisis synthetic securitisation.
....... News 29 May 2020
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Mobilising MILNs
The MILN market is in deep freeze but thaw might be due
The mortgage insurance-linked note (MILN) market has been closed for three months as a result of the Covid 19 dislocation, but well-placed sources say the smoke is clearing and that the market shutdown will not be as protracted as was originally feared.
“Through April, we had no discussions with investors that were at all constructive about new deals. .......
News Analysis 29 May 2020
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No call for OATH 1
Sector developments and company hires
No call for OATH 1
Market Moves 28 May 2020
UK Mortgages and TwentyFour Asset Management have notified Oat Hill No. 1 bondholders that the RMBS will not be redeemed on its first refinancing call date of 27 May (SCI 22 April). TwentyFour says the transaction was not called as, due to the Covid-19 situation, financing markets were only available at relatively expensive levels .......
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Growth phase
European CLOs seeing increasing attention to ESG criteria
The current crisis has initiated further discussion surrounding sustainability. Expectations are that investor demand and policy changes will further integrate ESG considerations into the CLO investment process.
Andrew Lawson, head of capital markets at Permira Debt Managers, says: “Investors continue to pay increasing attention to ESG criteria, particularly following this pandemic. As the investors demand greater focus on ESG principles, .......
News Analysis 28 May 2020
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Pan-European guarantee fund launched
Sector developments and company hires
Pan-European guarantee fund launched
Market Moves 27 May 2020
The EIB board has approved a €25bn Pan-European Guarantee Fund (EGF) - which will be funded by EU member states pro rata to their shareholding in the bank – as part of its overall response to the Covid-19 crisis. By guaranteeing parts of portfolios, operations under the guarantee fund will free up capital for financial intermediaries .......
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Marketplace merit
Online lending resilient amid impairments
The performance of online lending platforms remains resilient, despite coronavirus-related pressures. Indeed, dv01 data suggests that total loan payment impairments are showing signs of slowing down, after peaking earlier this month.
Vadim Verkhoglyad, principal analyst at dv01, says: “It looks like total impairments peaked at last in the immediate term. There was a normal seasonal spike in early .......
News 27 May 2020
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Lift off
Francesco Di Costanzo, head of structured credit at Hoist Finance, answers SCI's questions
Q: How and when did you become involved with securitisation?
A: We are a licensed credit market institution, regulated as a bank, which gives us the advantage of low cost and consistent funding. However, this means, of course, that we are subject to bank capital requirements.
Over the years we have bought unsecured non-performing loan portfolios, to .......
The Structured Credit Interview 27 May 2020
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Persistent opportunity
Tor Trivers, md and head of the structured credit group at CDIB Capital, answers SCI's questions
Q: How and when did CDIB Capital become involved in the structured credit market?
The Structured Credit Interview 27 May 2020
A: CDIB Capital was established in 2006, as the private equity arm of China Development Financial, with the objective of deploying and diversifying the group’s proprietary capital outside of Taiwan. The firm has historically managed outside funds, but no credit-related assets until I joined in February .......
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Limited effect?
Performance trigger suspensions eyed
The Italian government last week passed the Decreto Rilancio, a decree that aims to restart the economy following the country's coronavirus-driven lockdown (SCI 15 May). The decree allows the Ministry of Finance to approve temporary suspensions of performance triggers that allow for the payment of special servicing fees for GACS guaranteed non-performing loan securitisations. If implemented, the change .......
News 22 May 2020