Complete news archive
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Hesitant appetite
US CLO market update
US CLO equity and double-B bonds were casualties of the drop in the S&P 500 index yesterday, with bids softening across the secondary market.
“A handful of CLO equity and double-B bonds were out for the bid yesterday and did not trade,” says a trader. “There was some clear hesitation in the market compared with a week ago. .......
Market Reports 21 November 2018
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Bloodbath blues
European ABS market update
The European ABS market has repriced, after taking a hit yesterday when the S&P 500 index plunged by 1.8%. The tone has improved this morning, as traders cautiously return to the market.
“We’re seeing the market repricing after the bloodbath that happened yesterday,” says one trader. “A lot of paper hit the shelf and nobody wanted to trade it; mezz ......
Market Reports 21 November 2018Premium Content
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Tougher approach
KNF stance puts Polish securitisation on hold
The future of securitisation and closed-end securitisation funds in Poland remains uncertain, following the Polish financial supervisory authority’s (KNF) approximately PLN6.4m (€1.49m) fine against Raiffeisen Polska in September. KNF fined the Austrian bank over its alleged failure in safeguarding securitisation fund assets as a depository bank in securitisation transactions, citing an incomplete register and lack of awareness over the .......
News Analysis 21 November 2018
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Buyer fatigue
US CLO secondary market update
The US stock market is 400 points down today (20 November) and is being described as an “ugly open”, with the sell-off beginning to unnerve traders. The effects are impacting the US CLO secondary market, as the fatigue of the past year catches up with investors.
“A lot of CLO managers are trying to get deals done, but investors are .......
Market Reports 20 November 2018
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Long goodbye
First non-Libor linked ABS anticipated
Lloyds became the first bank to issue a benchmark covered bond tied to the sterling overnight index average (SONIA) in September. The move has sparked predictions that the first securitisations tied to alternative reference rates will emerge next year.
Libor is set to be phased out from 2021 and it remains unclear what will replace it as a .......
News Analysis 20 November 2018
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Credit clutch
European ABS market update
The European ABS slow-down continues, with prices drifting wider and subdued credit growth across the board. In particular, an aversion to duration risk has emerged this week.
“Credit is headed for the worst year since 2008,” one trader explains. “ABS traders are not used to showing negative figures to their clients. People are reassessing the market.”
In .......
Market Reports 20 November 2018
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Fixed income head hired
Company hires and sector developments in structured finance
Newmark Group has established an operating committee consisting of key senior managers following the spin-off from BGC announced on the 13 November. The operating committee members are as follows: Lou Alvarado, chief revenue officer, previously senior md at Cushman & Wakefield; Raj Bhatti, cio, previous partner at Kinetix Trading Solutions; Jeff Day, president and head of multifamily capital .......
Market Moves 19 November 2018
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SCI Start the Week - 19 November
A review of securitisation activity over the past seven days
Market commentary
Pepper Group is prepping an Australian RMBS that is expected to include a short US dollar tranche and a euro-denominated pass-through tranche. Elsewhere in the European primary securitisation market, a pair of Dutch RMBS were in focus last week – NIBC Bank’s €476.2m Dutch MBS XIX and Elan Woninghypotheken’s €337m EDML 2018-2 (SCI 16 November).Ever-increasing primary issuance .......
News 19 November 2018
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STS documents released
Sector developments and company hires in structured finance
ILS
Hiscox has made three new appointments to its ILS division. Mike Schindel has been promoted to head of North America underwriting from head of international underwriting. Schindel will continue to be based in Bermuda. Nick Orton has been promoted to head of international, based in London, and worked most recently as a senior underwriter within the international team. Finally, .......
Market Moves 16 November 2018
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Double Dutch
Dutch RMBS market sees surge of activity
The Dutch RMBS market has seen a surge of activity with two new Dutch RMBS transactions marketing, both of which are backed by prime Dutch residential mortgages and touted as STS compliant. NIBC is back on the scene after a five-year hiatus with the €476.2m Dutch MBS 19 deal, while also marketing is the Goldman Sachs-mandated €337m EDML 2018-2 transaction from .......
News 16 November 2018
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Less liquidity
US CMBS secondary market update
Risk aversion continues in the US CMBS market, with flows described as “anaemic” due to the volatility seen over the past few weeks.
“I’m hearing that The Street went into this heavy on paper and they are feeling that quite a bit,” says a trader. “It seems most buyers are aware of it too – anything behind triple-B .......
Market Reports 16 November 2018
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Risk transfer round-up - 16 November
Capital relief trade sector developments and deal news
Deutsche Bank is rumoured to be executing a bilateral trade finance capital relief trade from its TRAFIN programme this month, as a replacement trade for TRAFIN 2015-1. TRAFIN 2015-1 was due for November 2022 (see SCI’s capital relief trades database), but the German lender has decided to call it and reportedly replace it with a new deal. The ......
News 16 November 2018Premium Content
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Selling stagnation
European ABS market update
Activity in the European ABS primary and secondary markets has slowed this week, with volumes generally stabilising across both segments.
“It feels a little softer on the secondary market,” says one trader. “There has been between a 5bp to 10bp drop in spreads across the board, although a decent bid remains for 2.0 paper. There are fewer sellers .......
Market Reports 16 November 2018
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CMBS desk launched
Sector developments and company hires in structured finance
Europe
Simmons & Simmons has hired James Grand to lead its CLO offering. Grand was previously a structured products partner at Freshfields where he spent over 20 years, specialising in advising both the sell-side and the buy-side on CLOs, as well as contentious and non-contentious derivatives work, structured credit, tax structured products, regulatory capital and prime brokerage.
Partnerships
Alexandria Capital .......
Market Moves 15 November 2018
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Winding down?
US CLO market update
The US CLO primary market is seeing steady issuance as the remaining trading days continue to expire. Primary activity is presently more robust than secondary activity, which is said to be “a little squishier.”
Currently, there is a good bid for double-B CLO paper, whereas preference for triple-B and single-B paper varies from deal to deal. Generally the ......
Market Reports 15 November 2018Premium Content
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Dry powder
International ABS market update
Pepper Group is prepping an Australian RMBS that is expected to be sized at A$500m-equivalent and include a short US dollar tranche and a Euro-denominated pass-through tranche. Elsewhere in the European primary securitisation market, Tesco’s Delamare Cards MTN Issuer Series 2018-1 deal – the senior tranche of which is being talked at one-month Libor plus 70bp – is expected .......
Market Reports 15 November 2018
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Diverging dynamics
Aussie non-banks driving change
Around A$30bn of Australian RMBS issuance is expected for full-year 2018, over 50% of which will be originated by non-bank lenders. A confluence of demand and regulatory factors is driving growth in non-bank issuance and changing the shape of the market.
Jordan Batchelor, director, structured capital markets at ANZ, says that a divergence is emerging between RMBS originated .......
News Analysis 15 November 2018
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Dual speed
Standard Chartered follows with tranche carve-up
Standard Chartered has completed a US$297.5m financial guarantee that references a US$3.5bn trade finance portfolio. Dubbed Sealane 4, the transaction is a replacement trade for Sealane 3 - which matures in December - and is structured as a dual mezzanine tranche to appeal to a broad base of investors and address the EU Securitisation Regulation’s higher capital requirements.
News Analysis 14 November 2018
Premium Content
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Tranche tinkering
US RMBS market update
Freddie Mac has restructured some of the mezzanine tranches in its most recent credit risk transfer RMBS, STACR 2018-HRP2, which references high LTV re-performing mortgage loans. IPTs for the transaction are similar to those of previous STACR deals, with the third mezzanine tranche split into two classes of notes.
“Credit has been good and has been performing fundamentally .......
Market Reports 14 November 2018
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Trading countdown
US CMBS primary market update
The US CMBS market is facing a heavy primary calendar this week, which is overshadowing secondary market activity and causing risk aversion.
“We have seen healthy issuance volumes over the past few weeks,” says one trader. “As far as the markets are concerned, it does not feel as though there is an appetite for added risk.”
He .......
Market Reports 14 November 2018
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NPL transaction markets
Sector developments and company hires in structured finance
NPL deal markets
Banco Santander Totta is in the market with Hefesto STC (Guincho), a €98m securitisation backed by a €481m portfolio, by gross book value (GBV), of Portuguese non-performing residential, commercial and unsecured loans originated by Banco Santander Totta. DBRS and Scope have assigned provisional ratings, respectively, of triple-B (low)/triple-B minus to the €84m class A notes and triple-C/single-B minus to the €14m ......
Market Moves 13 November 2018Premium Content