Complete news archive
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SCI Start the Week - 22 October
A review of securitisation activity over the past seven days
Market commentary
European primary ABS activity continued to be robust last week. The BPCE Home Loans FCT 2018 print and the announcement of Porsche’s Austrian auto ABS were among the highlights (SCI 18 October).“A variety of asset classes are represented in the primary market at the moment,” said one trader. “Spreads are well supported – we’re seeing good levels .......
News 22 October 2018
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Performance blueprint
Positive predictions for NPL securitisations
Northern Italian non-performing loan portfolios are performing better than Southern Italian portfolios, and Irish transactions are also outperforming assumptions. There are 11 transactions currently in the European NPL pipeline, most of which are Italian.
“At the moment, the majority of the transactions are outperforming DBRS plan assumptions,” says Alessio Pignataro, svp at DBRS. “However, it is early in .......
Talking Point 19 October 2018
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Technicals eyed
European ABS market update
Porsche’s FACT Compartment 2018-1 auto lease ABS has seen no substantial resistance in the European primary market. Indeed, spreads appear rangebound for now.
“Because we are in the last few months of the year, people know that whatever they have done so far, they will have to stick with,” says one trader. “They cannot change their numbers. At .......
Market Reports 19 October 2018
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Risk transfer round-up - 19 October
CRT sector developments and deal news
Credit Suisse is believed to be readying a Swiss corporate deal from its Elvetia programme. The issuer’s last Elvetia transaction was a Sfr300m ticket referencing a Sfr5bn Swiss mortgage portfolio (see SCI capital relief trades database).
...... News 19 October 2018Premium Content
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Market moves update
Company hires and sector developments in structured finance
Alternatives alliance
Market Moves 18 October 2018
DWS Group and Tikehau Capital have entered into an alliance, following Tikehau’s participation in the IPO of DWS in March 2018. Under the agreement, DWS and Tikehau intend to launch a joint product leveraging the two companies’ alternative asset management expertise and platforms, which is expected to launch in 2019. The partners intend to cross-invest in respective funds, with .......
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Primary energy
European ABS primary market update
The European primary RMBS market has come to life after the BPCE Home Loans FCT 2018 priced today (18 October). The senior tranches printed at between high-20s to low-30s.
“With a lot of new issues pricing, investors are putting their energy into primary instead of secondary,” says one trader. “Of note, Porsche’s Austrian auto ABS has appeared on .......
Market Reports 18 October 2018
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Latest SCI podcast now live
SCI podcast episode two has been released
SCI’s latest podcast is now live. This month the team discuss the African Development Bank’s Room2Run CRT, how fintech is affecting MPL ABS and the changing use of credit derivatives.
The AfDB’s Room2Run deal, scheduled to close imminently, has shaken up the CRT sector, emphatically underlining that issuers do not have to be European and assets do not have to be .......
News 18 October 2018
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Steady subscription
European ABS primary market update
European primary ABS activity continues to be robust. In the RMBS sector, the BPCE Home Loans FCT 2018 deal is set to price tomorrow (18 October).
“A variety of asset classes are represented in the primary market at the moment, with the French BPCE Home Loans RMBS and the German auto deal that priced last week,” says one .......
Market Reports 17 October 2018
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Default proxy
Second income-contingent SLABS prepped
The UK government is readying a £3.88bn securitisation backed by English plan 1 income-contingent loans granted to students whose repayment date fell between 2007 and 2009, the second public transaction of its type (SCI 14 December 2017). Dubbed Income Contingent Student Loans 2 (2007-2009), the deal is characterised by the loans being written-off once the borrowers reach the ......
News 17 October 2018Premium Content
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Market moves update
Company hires and sector developments in structured finance
CRT poll results
Market Moves 17 October 2018
The results from SCI’s ‘What’s in a name?’ survey are in. Delegates at SCI’s Capital Relief Trades Seminar yesterday were polled as to what the most appropriate term should be for capital relief trades from 11 different choices. Out of over 80 responses, 22% voted for ‘credit risk transfer’, 20% for ‘risk-sharing transaction’, 18% for ‘capital relief .......
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'Aggressive' underwriting eyed
UK RMBS remains 'robust' in face of Brexit
While the UK buy-to-let (BTL) sector has suffered under new regulatory policies and Brexit uncertainty, market participants believe it still has room to expand in terms of new lenders and products. This was according to panellists at a recent Fitch conference that also suggested that more aggressive underwriting practices, such as extended loan terms, could be a concern for the .......
Talking Point 17 October 2018
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Hurdle cleared
First post-crisis RMBS for Wells Fargo
Wells Fargo is in the market with its first post-crisis prime US RMBS. Named Wells Fargo Mortgage Backed Securities 2018-1 Trust, the US$441.25m deal securitises 660 first lien residential mortgage loans.
Moody’s has assigned preliminary ratings of Aaa to the class A1 to class A16 notes, Aa1 to the class A17 and A18 notes, Aaa to the class .......
News 15 October 2018
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Second wave
Synthetic CRE transactions launched
Santander and NatWest have completed two commercial real estate risk transfer transactions and the market is expecting another CRE deal in 4Q18. This marks the second wave of synthetic CRE transactions, following the first wave last year, with the issuance of three transactions by Santander, Lloyds and Barclays (see SCI’s capital relief trades database). The second synthetic CRE .......
News Analysis 15 October 2018
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Market moves update
OFS equity investment
OFS Credit Company has disclosed that it has invested in the equity tranches of 19 CLOs, 17 of which have a reinvestment period ending in 2022 or beyond, for a total cost of US$43.6m (US$53.4m principal amount). The move follows OFS Credit’s IPO, which closed on 10 October and resulted in net proceeds of US$50m. OFS Capital .......
Market Moves 15 October 2018
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SMBC debuts
Structured covered bond programme readied
Sumitomo Mitsui Banking Corp (SMBC) is prepping a €20bn dual-recourse structured covered bond programme, marking the emergence of a new name and a new jurisdiction to the market. The cover assets comprise triple-A rated Japanese RMBS originated by the bank and the deal features an innovative total return swap (TRS) mechanism.
Moody’s has assigned a provisional long-term rating of Aaa .......
News 15 October 2018
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SCI Start the Week - 15 October
A review of securitisation activity over the past seven days
Market commentary
Robust demand was seen in both the European and US CLO markets last week (SCI 9 October). Equity arbitrage reached 16% in the European CLO market, with a zero percent default rate for some portfolios.“This is an equity investor’s best-case scenario,” said one trader, “short of a crisis situation.”
Spreads moved up in Europe because of the .......
News 15 October 2018
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Market moves - 12 October
Company hires and sector developments in structured finance
Cliff edge concerns
ISDA has published a paper highlighting widespread concerns in Europe that the UK may withdraw from the EU without a withdrawal agreement under Article 50 of the Treaty on European Union and without any transition, or implementation period, to allow market participants time to adjust. The paper sets out why a ‘no deal’ scenario has the potential .......
Market Moves 12 October 2018
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Greek GACS?
Greek government considering asset protection scheme
The Greek government is considering the creation of an asset protection scheme as part of the state’s non-performing loan reduction strategy. The scheme will involve state guarantees on bonds issued by SPVs, rendering it similar to the Italian GACS guarantee.
Market sources note that the proposed Greek scheme can only work if the guarantee covers both the senior .......
News Analysis 12 October 2018
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Risk transfer round-up - 12 October
CRT sector developments and deal news
Deutsche Bank is believed to be prepping a trade finance transaction from its TRAFIN risk transfer programme for 4Q18. The rumoured deal would be the German lender’s first TRAFIN deal in three years and follows two issuances in June from the GATE and CRAFT programme (see SCI’s capital relief trades database).
...... News 12 October 2018Premium Content
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Secondary ticking up
European securitisation market update
A handful of BWICs are out for the bid today as activity in the European ABS secondary market picks up. Of note, the SILVA 2017-1UK A auto bond – with an original size of £80.8m - is set to be auctioned at 2pm London time today.
“Auto ABS is holding up quite firm and the sector is .......
Market Reports 12 October 2018
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Manager differentiation?
US CLO primary market update
US CLO spreads are tightening, despite increased supply. Fresh primary market issuance is emerging daily.
“Even though there is lots of supply, spreads are still tightening - although we are not really sure why. We think they should be widening. There seems to be a good demand for paper,” says one trader.
The trader reports that participants .......
Market Reports 11 October 2018