Complete news archive
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Bid scarcity
European ABS market update
A major UK bank is focusing efforts of European NPLs in the coming weeks, as spreads continue to widen in the CLO and ABS primary markets.
“We are running a few private processes, which are keeping us busy, and we will hopefully conclude them over the next couple of days,” says a trader.
The trader comments that .......
Market Reports 7 December 2018
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BTL securitisation planned
Sector developments and company hires
Europe
Accunia has promoted Mads Romild as head of Accunia’s CLO platform. Romild will continue as cio and head all Accunia investment strategies. Andres Garcia Bartolome and Rajiv Thaker are also promoted to senior portfolio managers and will be responsible for the portfolio management of the three existing and all new Accunia CLOs. Romild previously held a position as chief portfolio .......
Market Moves 6 December 2018
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Deals pulled?
US CLO market update
Several US CLO deals are believed to have been pulled from the pipeline and pushed back to 2019, amid growing concerns over market conditions.
“What we are trying to do right now is to gauge customer demand,” says one trader. “We are trying to find out what our customers want and at the moment we are not getting ......
Market Reports 6 December 2018Premium Content
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Sears CDS 'torpedo' attempt
Credit event manipulation casts new shadow on instrument
After filing for bankruptcy earlier this year, Sears is now at the centre of a high-profile saga in relation to credit event manipulation affecting its associated CDS. Various tactics have now been employed by interested parties to prevent the firm’s liquidation, which could reduce any pay out on the CDS, raising further questions about the instrument’s viability.
Brian Guiney, .......
News Analysis 6 December 2018
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Cheaper deals
European CLO market update
The European CLO market seems stronger than it was last week, but still relatively volatile.
“I suppose good managers get deals done; I think that’s the bottom line,” says a trader. “For managers that are perceived to be worse, it is harder now.”
He continues: “November was an expensive month to price new deals in Europe. We .......
Market Reports 5 December 2018
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TRAFIN relaunched
Deutsche Bank replaces trade finance CRT
Deutsche Bank has refinanced its TRAFIN 2015-1 deal with the issuance of a new trade finance capital relief trade dubbed TRAFIN 2018-1. The US$216.125m five-year CLN references a US$3.5bn trade finance portfolio.
Deutsche Bank called and replaced the 2015 transaction last month with a new deal in order to lock in a better coupon. “High demand for trade finance CRTs .......
News Analysis 5 December 2018
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Colonnade issuance continues
Barclays completes corporate capital relief trade
Barclays has completed Colonnade Global 2018-2, a US$110m financial guarantee that references a US$1.33bn portfolio of mostly US corporate loans (see SCI's capital relief trades database). The transaction is typical of Colonnade Global risk transfer deals in the sense that the credit protection covers both principal and accrued interest.
Rated by DBRS, the transaction consists of US$1.1bn triple-A rated .......
News 5 December 2018
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Split-mortgages securitised
PTSB completes second NPL transaction
Permanent TSB last week completed its second major transaction to reduce its non-performing loan ratio. The bank disposed of Irish mortgage loans with a €1.31bn GBV (€910m NBV) linked to 6,272 borrowing relationships via the Glenbeigh Securities 2018-1 RMBS.
The majority of the borrowing relationships are secured by private dwelling home loans, with 133 secured by buy-to-let loans. ......
News 5 December 2018
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Enforcement uncertainty
Set-back for STS-eligible issuance
The recent statement issued by the Joint Committee of the ESAs (SCI 4 December) is unlikely to be sufficient to assuage securitisation market concerns on its own. Such regulatory uncertainty is expected to further delay the emergence of STS-eligible securitisations in the pipeline.
“The statement by the Joint Committee of the ESAs acknowledges the concerns about the .......
News 5 December 2018
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Print and sprint
US CLO market update
US CLO BWIC activity is booming ahead of tomorrow’s market holiday in honour of former president George H.W. Bush.
Bid-lists have mainly been triple-A oriented, whereas demand for triple-B bonds has faded. Double-B bond prices are 1.5 points worse off.
“People are re-evaluating double-B bonds based on market value (MVOC) and are focusing on high quality,” .......
Market Reports 4 December 2018
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Activity upsurge
European ABS market update
The European primary and secondary ABS markets are seeing a surge in activity, due to uncertainty over the next quarter.
“After the high volatility last month, I was expecting a slow-down,” says one trader, surprised by the activity.
He suggests that market ambiguity around the next quarter is driving it. “The consensus is that things will only get choppy from .......
Market Reports 4 December 2018
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BDC merger announced
Sector developments and company hires
BDC merger
Golub Capital BDC (GBDC) has merged with Golub Capital Investment Corporation (GCIC), with GBDC as the surviving company, subject to certain stockholder approvals and customary closing conditions. The combined company will remain externally managed by GC Advisors and all current GBDC officers and directors will remain in their current roles. The transaction is expected to close .......
Market Moves 4 December 2018
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Sustainable growth?
Prospects for green CLOs examined
Green CLOs are expected to play an increasing role in the private sector’s involvement in the sustainable finance market. As such, S&P has created a hypothetical rating scenario to compare the credit quality of green CLOs with a typical European CLO 2.0 deal.
“There is a need for more funding in this space,” says Jekaterina Muhametova, associate at S&P. “Green .......
News 4 December 2018
Proportional approach
ESAs tackle delay in transparency requirements
The joint European Supervisory Authorities (ESAs) - which consist of the EBA, ESMA and the European Insurance and Occupational Pensions Authority - have published a letter reiterating market concerns over ESMA’s disclosure requirements (SCI 5 October) and Article 14 (SCI 9 July) of the CRR. The authorities have also called on EU national regulators to apply a ......
News 4 December 2018Premium Content
ESAs suggest 'proportion'
Sector developments and company hires
Aussie securitisation fund
The Australian government has introduced a A$2bn Australian Business Securitisation Fund, which will provide significant additional funding to smaller banks and non-bank lenders to on-lend to small businesses on more competitive terms. The fund will be administered by the Australian Office of Financial Management (AOFM), consistent with its prior involvement in the RMBS market in .......
Market Moves 3 December 2018
Multi-jurisdiction exposure
Cashflow trade finance CLO prepped
Standard Chartered is in the market with its first global cashflow CLO backed by US$1bn of trade finance exposures (TFEs), with collateral from across multiple jurisdictions. The senior tranche of the deal – dubbed Prunelli Issuer I (compartment 2018-1) – represents 75% of the assets, with overcollateralisation accounting for the remainder.
The pool, which has a revolving period .......
News 3 December 2018
SCI Start the Week - 3 December
A review of securitisation activity over the past seven days
Market commentary
European ABS activity remained subdued last week, with spreads drifting wider, due to concentration of supply (SCI 29 November).“Investors are using their leverage to dictate terms and push deals as wide as possible. That’s one of the reasons why the pipeline has been brought forward,” said one trader.
He added: “If a deal is struggling, an investor .......
News 3 December 2018
NPL plans accelerated
Company hires and sector developments
Eurobank merger
Eurobank is merging with Grivalia in a bid to accelerate the reduction of non-performing exposures to a ratio of approximately 15% by end-2019 and single-digits by 2021. The transaction envisages an NPE deconsolidation of approximately €7bn, with all shareholders keeping potential upside from the assets. The merger will create the best capitalised bank in Greece, with .......
Market Moves 30 November 2018
Tighter pricing
Latest Elvetia trade completed
Credit Suisse has completed a Swiss corporate and SME significant risk transfer trade from its Elvetia programme, dubbed Elvetia Finance Series 2018-6. The trade printed at tighter levels compared to previous Elvetia corporate and SME deals, due to wide syndication. The transaction was completed under the new securitisation framework, which stipulates thicker tranches and was also a driver of the ......
News 30 November 2018Premium Content
Tough approach
PRA guidance puts UK CRT issuers at a disadvantage
The UK PRA’s latest significant risk transfer guidance is putting UK capital relief trade issuers at a disadvantage compared to their European peers, mainly due to the regulation’s provisions on excess spread and the capital treatment of standardised portfolio transactions. The regulation is broadly in line with a consultation from May that sparked a market backlash (SCI .......
News Analysis 30 November 2018
Funding boost for online lender
Sector developments and company hires
Alesco CDOs transferred
The collateral management agreements for the Alesco Preferred Funding X to XVII Trups CDOs have been assigned to Hildene Collateral Management Company (HCMC), an affiliate of Hildene Capital Management. Under the terms of the assignments, HCMC agrees to assume all the responsibilities, duties and obligations of the current collateral manager (ATP Management) under the agreements and under .......
Market Moves 29 November 2018