Complete news archive

  • Performance sparks RPL upgrades

    Many post-crisis RMBS reperforming (RPL) loan transactions have performed better than expected, leading Fitch to upgrade 171 classes from 18 RPL deals. A dozen subordinate bonds were upgraded from double-B to investment grade, while 486 RPL ratings were affirmed.

    The upgrades follow a review of RPLs, seasoned performing loans and one REMIC transaction, spanning 657 loans over 44 deals issued .......

    News 27 April 2018

  • SRT features incorporated

    The EIF has granted BBVA a €90m guarantee on a mezzanine tranche of a €1.95bn portfolio which will enable the provision of up to €600m financing of new investment projects to Spanish SMEs. The transaction incorporates structural features from the EBA’s significant risk transfer discussion paper and is part of a wave of agreements supporting SMEs across Europe.

    News Analysis 27 April 2018

  • Investors seek more Trups CDO issuance

    EJF Capital recently launched a US$535.090m Trups CDO, TFINS 2018-1, which is its sixth Trups CDO since 2015. While this underlines revived interest in the asset class, supply constraints continue to be a dampener on the market.

    Kroll Bond Rating Agency has assigned provisional ratings of double-A minus on the US$360.790m class A1 notes (which will pay three-month Libor plus .......

    News Analysis 26 April 2018

  • ECB encourages action on NPLs

    Gifford West, md, international operations and business deve...

    At a recent NPL industry event, a banker credited with completing some of the largest European NPL sales observed: “The Irish and UK banks were distressed sellers. Now their banks are on the path to recovery. The Italian banks refused to be distressed sellers. Now they are mostly distressed banks.”

    The ECB’s guidance published on 15 March 2018 is .......

    Talking Point 26 April 2018

  • CRT issuance boost expected

    Total capital relief trade issuance this year should exceed 2017, believes alternative asset manager PAG Asia, one of the sector’s major investors. Issuance is expected to be accelerated by an end to accommodative central bank monetary policies, underlining the importance of investing experience and expertise.

    James Parsons, portfolio manager at PAG Asia, says: “This year may be a pivotal year .......

    News Analysis 25 April 2018

  • Potential solution to IFRS 9 volatility

    Capital relief trade issuers are understood to be considering whether credit guarantees which are accounted for as a “reimbursement asset” can be used to mitigate volatility arising from the implementation of IFRS 9 expected credit losses. However, the accounting technique features its own challenges and raises a number of other questions.

    A reimbursement asset is recognised for holders of credit .......

    News Analysis 25 April 2018

  • Risk-sensitive update for Solvency 2

    The European Commission has launched a consultation on its proposed new risk-sensitive treatment of securitisations under Solvency 2. The proposal – which seeks to harmonise existing legislation with the STS framework - has been welcomed for its potential to attract insurers back into the ABS market.

    The Commission proposes replacing the existing Solvency 2 classification of securitisation positions .......

    News 23 April 2018

  • SCI Start the Week - 23 April

    A look at the major activity in structured finance over the past seven days

    Pipeline
    Auto ABS dominated the pipeline once again last week. A handful of other ABS, as well as CMBS and RMBS were also announced.

    The auto ABS remaining in the pipeline by the end of the week were: US$1.1bn Ally Auto Receivables Trust 2018-2, US$400m Avis Budget Rental Car Funding Series 2018-1, Bavarian Sky German Auto Loans 8, .......

    News 23 April 2018

  • Market moves - 20 April

    Acquisitions

    BlackRock has acquired Tennenbaum Capital Partners (TCP), complementing its global credit business at a time when clients are increasingly turning to private credit as a higher-yielding alternative to traditional fixed income allocations. A key element of the transaction – which is expected to close in Q3 - is the continuity of TCP's senior management team, including all five partners .......

    Market Moves 20 April 2018

  • Proportional protection reviewed

    EU policymakers are currently negotiating an amendment to Article 234 of the CRR that would allow banks to treat first-loss protection as proportional protection. If successful, the move is expected to boost mortgage significant risk transfer issuance.

    According to Article 234 of the CRR, loan-level insurance protection for synthetic securitisations that is tranched first-loss protection must apply Chapter .......

    News Analysis 20 April 2018

  • Risk transfer round-up - 20 April

    The capital relief trades market is undergoing a quiet period, following some unusual activity for Q1. Sources point to three transactions during this period from Deutsche Bank, Credit Suisse and a “UK bank with a non-standard portfolio”. Meanwhile, a Spanish bank is rumoured to be prepping another deal.

    Drivers behind the Q1 activity include pent-up supply from last .......

    News 20 April 2018

  • Libor transition frailties exposed

    The New York Fed has begun publishing the Secured Overnight Financing Rate (SOFR), a much-touted Libor replacement, despite industry participants suggesting that a thorough plan has yet to be made for the transition away from the benchmark. At the same time, there is concern over whether enough consideration has been given to the financial products tied to Libor - .......

    News 19 April 2018

  • NPL partnership inked

    Intesa Sanpaolo and Intrum have agreed to form a strategic partnership in respect of non-performing loans. The agreement involves two transactions, including what is expected to be a landmark securitisation for the Italian market.

    Under the partnership, the Italian NPL platforms of Intesa Sanpaolo and Intrum will be integrated to create a servicer with around €40bn of assets .......

    News 18 April 2018

  • Swiss mortgage portfolio sale eyed

    BNP Paribas last week acquired Raiffeisen Bank Polska (Polbank), the Polish subsidiary of Raiffeisen Bank International (RBI), but carved out from the acquisition a portfolio of mainly Swiss franc-denominated foreign currency residential mortgages. The €3.5bn portfolio derailed earlier attempts by RBI to either sell or IPO Polbank, so Polish financial regulator KNF finally rejected the transfer of the portfolio, .......

    News Analysis 18 April 2018

  • SCI Start the Week - 16 April

    A look at the major activity in structured finance over the past seven days

    Pipeline
    The newly-announced transactions remaining in the pipeline at the end of last week comprised ABS and RMBS. The ABS deals were backed by auto, equipment and whole business collateral.

    The auto ABS were: US$611m Canadian Pacer Auto Receivables Trust 2018-1, US$1.1bn CarMax Auto Owner Trust 2018-2, €488m Driver Italia One, Exeter Automobile Receivables Trust 2018-2, US$1.06bn Ford .......

    News 16 April 2018

  • Market moves - 13 April

    Aircraft ABS on watch
    KBRA has placed the class A, B and C notes of the US$411m Prop 2017-1 ABS on watch for downgrade. The ABS represents the first securitisation from Elix Aviation Capital, with the proceeds being used to buy 63 aircraft on lease to 17 airlines in 12 countries. KBRA notes that one aircraft was not delivered to .......

    Market Moves 13 April 2018

  • Microfinance ABS regroups after defaults

    A number of Indian microfinance loan securitisations recently defaulted, halting a trend of strong performance and steady growth in the asset class. While demonetisation is partly to blame, lender overexpansion and the introduction of a competing credit instrument also took their toll.

    Several firms have historically used securitisation to fund their microfinance lending in India, culminating in 2016 .......

    News Analysis 13 April 2018

  • Italian NPL securitisations outpace loan sales

    Non-performing loan securitisation volume has outpaced outright sales in Italy, as banks seek to benefit from the GACS guarantee scheme. The trend is expected to continue this year, thanks to a strong track record over the last 12 months and an investment shift towards Southern Europe.

    Italian NPL transaction volume last year totalled €32.67bn across 33 deals (up from €12.54bn .......

    News Analysis 12 April 2018

  • Provisioning impact muted

    The ECB and European Commission have both put forward new rules for minimum loss coverage, which are a step towards improving provisioning practices across Europe and avoiding future unreserved non-performing loan build up. Although having two different sets of rules may create regulatory uncertainty across the banking sector, the impact for NPL securitisation seems muted.

    “The rules deal .......

    News Analysis 11 April 2018

  • CLOs becoming too equity-friendly?

    Loosening documentation and a greater proportion of income being distributed to subordinate noteholders have sparked concern that US CLOs are becoming too equity-friendly. Nevertheless, headwinds may be approaching for equity investors as a result of a Libor mismatch.

    Respondents to JPMorgan’s Q1 US CLO investor survey suggested that some documentation has become too “equity friendly”, highlighting the growth .......

    News 11 April 2018

  • Financial guarantee ILS debuts

    Build America Mutual Assurance Company (BAM) is in the market with what is believed to be the first ILS to transfer the risk of loss on a portfolio of financial guarantees. The Fidus Re Series 2018-1 transaction features US$100m twelve-year class A notes, with a five-year par call.

    BAM provides financial guarantees exclusively on lower risk segments of .......

    News 10 April 2018
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