Complete news archive
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Test case
Unsecured NPL transaction completed
Bank of Cyprus has signed an agreement for the sale of a retail unsecured non-performing loan portfolio with APS. Dubbed Project Velocity, the transaction is a test case that may further fuel future NPL transactions by the bank.
The contractual balance of the portfolio is €245m, representing the total amount owed by the borrower, including accrued charges. The .......
News 15 February 2019
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Private placement
Unusual tranched securitisation closed
Fintex Capital has completed a structured finance transaction within its UK real estate lending business, Fintex Confluence. The transaction involved the refinancing of a portfolio of property loans - warehoused by Fintex - with senior financing provided by Europa Capital Debt Investment (ECDI) and junior financing by Fintex, with additional monies invested by Europa and Fintex to finance a .......
News 14 February 2019
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Bank expands credit derivatives business
Company hires and sector developments
Credit trading expansion
HSBC has hired Asgar Rahemtulla as a director in credit trading. In his new role, Asgar will be responsible for trading European iTraxx index products. He joins HSBC from Bluecrest where he was a Partner and worked as a portfolio manager. Prior to this he spent eight years at Goldman Sachs in a variety of roles including .......
Market Moves 14 February 2019
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Making hay
Private-label multifamily origination moves aside for agency CMBS
US agency CMBS volume has risen at an average clip of 50% per year post-crisis, hitting a record US$107.9bn of issuance in 2017. A new Trepp study suggests that the sector’s growth has come at the expense of private-label multifamily origination.
The average annual agency CMBS issuance during 2010-2018 grew to US$64.9bn from a previous average of US$4.9bn ......
News Analysis 13 February 2019
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Window of opportunity?
Japanese ruling may benefit US CLO market
The introduction of Japanese risk retention rules could provide a boost for US middle market CLOs, while volatility in Europe has opened up RMBS opportunities.
While most US middle market CLOs are risk retention compliant, most BSL CLOs are not, says a trader. They suggest that a risk retention ruling for Japanese investors might therefore “make them more likely to .......
News 13 February 2019
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Insurance firm expansion
Sector hires and company developments
Insurance firm expansion
Nassau Re is expanding into additional specialty finance asset classes as it grows assets under management in a three-pronged move. First, the firm has established Nassau Private Credit (NPC), which will invest directly in CLO equity and related investments for third-party institutional investors. Second, under its Nassau CorAmerica brand, it will expand its existing real estate .......
Market Moves 12 February 2019
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Tranche trading seeing 'increased focus'
CDS products 'likely' to see innovation
CDS index tranche trading has seen an increase in focus from credit investors, with marketing materials showing some resemblance to that seen before the financial crisis. Innovation is also expected to grow around credit derivatives, with some firms looking to design systematic credit trading models utilising CDS.
Graham Neilson, investment director at Fulcrum Asset Management, says that his .......
News Analysis 12 February 2019
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Juno 2 completed
BNL closes NPL securitisation
Banca Nazionale del Lavoro has completed a €968m (GBV) non-performing loan securitisation of both senior secured and unsecured loans. Dubbed Juno 2, the transaction has a short weighted average life for collections, compared to other NPL securitisations rated by Scope.
“The vector is usually delayed compared to the business plan, but in this case the procedures are at .......
News 11 February 2019
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Staying selective
David Heilbrunn, senior md and head of product development,...
Q: How and when did Churchill Asset Management become involved in the securitisation market?
The Structured Credit Interview 11 February 2019
A: Churchill was established in 2006 by The Bear Stearns Merchant Bank, the private equity affiliate of Bear Stearns. At the time, I was a senior member of the firm’s CLO business and, given my experience creating and working with successful middle market loan managers, I was .......
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SCI Start the Week – 11 February
A review of securitisation activity over the past seven days
Transaction of the week
Banco BPM has completed a €7.4bn (GBV) securitisation of secured and unsecured Italian non-performing loans dubbed Leviticus SPV (SCI 8 February). The transaction involves the transfer of the bank's servicing platform to Credito Fondiario, which is part of a broader joint-venture trend in the Italian NPL market (SCI 14 December 2018)."The trend .......
News 11 February 2019
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RMAC claim
Company hires and sector developments
The RMAC Securities No. 1 Series 2006-NS1, 2006-NS2, 2006-NS3, 2006-NS4 and 2007-NS1 issuers have confirmed that they have been validly served with a Part 8 claim form by Clifden, naming them, the corporate services provider and the share trustee as defendants (SCI 28 January). The defendants consider the claim to be both procedurally defective and without merit, and .......
Market Moves 8 February 2019
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Leviticus closed
Banco BPM completes NPL securitisation
Banco BPM has completed a €7.4bn (GBV) securitisation of secured and unsecured Italian non-performing loans dubbed Leviticus SPV. The transaction involves the transfer of the bank’s servicing platform to Credito Fondiario, which is part of a broader joint-venture trend in the Italian NPL market (SCI 14 December 2018).
“The trend is driven by the desire to monetise ......
News 8 February 2019Premium Content
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European middle market maturing
US MM sector set to grow following BDC no-action letter
The middle market securitisation sector is only set to grow in the US, with relaxed regulatory constraints paving the way for BDCs to securitise their exposures. While the equivalent European sector is some way behind the US, the private debt market is now regarded as a “vanilla” asset class with institutional investor buy-in, suggesting middle-market securitisations will result after further .......
News Analysis 8 February 2019
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Junior demand
Credit enhancement concerns raised
Last year saw more single-B rated auto ABS paper issued in the US than in all previous years combined. Indeed, demand remains strong for junior notes, despite growing concerns over auto lending practices to less creditworthy borrowers.
Joseph Cioffi, partner and chair of the insolvency, creditors’ rights and financial products practice group at Davis & Gilbert, suggests that .......
News 8 February 2019
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CDS 'falling short'
Equity options benefits highlighted
Issues around liquidity and investor confidence may have rendered CDS ineffective as a means of modelling and hedging risk for credit investors. Equity options have now emerged as a potential alternative, offering various benefits such as faster hedging speeds and greater pricing accuracy.
Michael Hayes, executive director, model validation and best practices research at MSCI, comments that while .......
News Analysis 7 February 2019
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Insurer boosts ILS capability
Sector developments and company hires
Acquisitions
Eldridge Industries has increased its investment in Maranon, now holding a majority ownership position. In addition to the equity investment, affiliates of Eldridge have made further commitments to Maranon’s platform, which will support Maranon’s ongoing strategic initiatives, including expanding the company’s underwriting and hold capability. Eldridge will acquire the additional stake from Maranon’s co-founder and Managing Director .......
Market Moves 6 February 2019
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Nord LB acquisition dropped
Bank opts for owner recapitalisation
Nord LB’s owners have approved a plan to recapitalise the bank with funds from regional states and savings banks. The plan won the backing of its majority owner - the regional state of Lower Saxony, which has a 59% stake - last week, side-lining a rival offer by Cerberus and Centerbridge. The recapitalisation will further spur the bank’s shipping .......
News 6 February 2019
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US CMBS divergence eyed
CMBS issuance 'will be hindered' by worsening borrower terms
US CMBS is under scrutiny as figures have emerged showing weaker performance in post-crisis transactions originated by non-bank firms than those originated by banks, according to a recent report from Fitch’s CMBS team. Concurrently, CMBS borrowers are finding themselves in an ever weakening position due to the growing ubiquity of loan provisions that can ‘arbitrarily’ put cash management in .......
News Analysis 5 February 2019
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BoE, ESMA seal no-deal plan
Company hires and sector developments
No-deal agreement sealed
ESMA has agreed Memoranda of Understanding (MoUs) with the Bank of England (BoE) for the recognition of central counterparties (CCPs) and of the central securities depository (CSD) established in the United Kingdom (UK), that would take effect should the UK leave the European Union (EU) without a withdrawal agreement, the no-deal Brexit scenario.
US
Market Moves 5 February 2019
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SCI Start the week - 4 February
A review of securitisation activity over the past seven days
Transaction of the week
Bank of Montreal has printed a US and Canadian leveraged loan capital relief trade dubbed Manitoulin. The US$92.5m 7.3-year financial guarantee pays Libor plus 12.75%.
The transaction has been rated as triple-A on the class A notes, single-A on the class B notes and triple-B on the class C notes. Further features include the presence of .......
News 4 February 2019
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NPL securitisation flourishes
Extention of GACS to UTPs to fuel further growth?
European NPL securitisation has flourished over the past two years, reaching a total of €15bn in new issuance since 2016, with many deals coming from Italy since the introduction of the GACS guarantee. Further transactions are expected given the possibility of extending the guarantee to unable to pay (UTP) loans.
DBRS notes that there have been 26 NPL securitisations since .......
News Analysis 4 February 2019