Complete news archive
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Reflective ratings?
Trups CDO outlook stabilises, ratings questioned
The number of 'problem banks' monitored by the FDIC dropped in the second quarter from 888 to 865 - the first decrease since the financial crisis began - which should mean fewer new defaults in Trups CDOs. Although the market is not declaring a recovery just yet, questions are being asked about the accuracy of current ratings in the sector.
News Analysis 24 October 2011
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SCI Start the Week - 24 October
A look at the major activity in structured finance over the past seven days
Pipeline
Four transactions remained in the pipeline at the end of last week: the US$1bn Freddie Mac SPC Series K-15 CMBS; the €1.5bn IM FTPYME Sabadell 9 SME CLO; and two RMBS - Permanent Master Issuer 2011-2 and the A$500m Series 2011-1 SWAN Trust.Pricings
News 24 October 2011
European RMBS dominated issuance last week, with the €296m Carismi Finance 2011, €724m Grecale RMBS 2011, €935m .......
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Barcap accelerates CMBS expansion
Barclays Capital has announced several appointments to its CMBS finance business in the US. These appointments accelerate the recent expansion of the firm's CMBS origination capabilities, following the appointments of Larry Kravetz and Spencer Kagan (SCI 24 June), as well as the establishment of a CMBS loan origination programme with Fund Core Finance Group (SCI 19 September).
Jon Trauben joins .......
Job Swaps 24 October 2011
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Special servicer hires two
CWCapital Asset Management (CWCAM) has hired Eric Ellison and Toni Meyer Walker as mds. They will be responsible for diversifying services and building CWCAM's third-party business, as well as integrating the offerings of the CW platforms. Both Meyer Walker and Ellison will report to David Iannarone, president of CWCAM.
Ellison brings over 25 years of real estate industry expertise in .......
Job Swaps 24 October 2011
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Fastnet 5 restructured
Irish Life & Permanent (IL&P) has restructured Fastnet 5, an Irish RMBS.
Under the restructure, it increased the principal amount outstanding on the class A1 notes to €343m from €279m and reduced the principal amount outstanding on the class A2 and A3 notes to €343m from €510m and €527m respectively. This increased the credit enhancement for the class A notes .......
News Round-up 24 October 2011
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Gulf Stream key persons confirmed
Apollo Global Management has named the approved replacements to the key persons in the collateral management agreements for the 10 CLOs it acquired via its purchase of Gulf Stream Asset Management (SCI 8 July).
James Zelter, Anthony Civale, Joe Morroney and Stephen Riddell are the approved replacements on the Gulf Stream-Compass CLO 2002-I, 2003-I, 2004-1, 2005-1, 2005-II and 2007, as .......
Job Swaps 24 October 2011
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US conduit credit quality slips in Q3
The credit quality of the loans in the US CMBS that Moody's rated in the third quarter showed some slippage, suggesting looser underwriting, the agency says in a new report. Specifically, leverage as measured by Moody's LTV ratio increased to 95.2% in 3Q11 from 93.9% in 2Q11.
"Although the credit metrics of 3Q11 conduit loans generally remain comparable to those .......
News Round-up 21 October 2011
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CMBS financial statements missing
Many of the specially serviced US CMBS loans that have returned to performing have not reported current financial data, according to Fitch. The agency argues that this lack of information leaves investors in the dark with respect to the property's performance.
"Fitch Ratings believes special servicers should make an effort to collect operating statements on specially serviced loans as per .......
News Round-up 21 October 2011
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MiFID 2 unveiled
The European Commission is proposing to revise the Markets in Financial Instruments Directive (MiFID), with the aim of making financial markets more efficient, resilient and transparent. The new framework will also increase the supervisory powers of regulators and provide clear operating rules for all trading activities.
MiFID already covered multilateral trading facilities and regulated markets, but the revision will bring .......
News Round-up 21 October 2011
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Hesitant hiring
Recruitment lull expected to continue
After a quiet year so far for those in structured finance recruitment, the final quarter is not expected to buck the trend. Participants appear to be taking a more measured view of the recovery, with cautious expansion set to be the dominant trend going forward.
A lot was expected of 2011, but it has not quite lived up to those .......
News Analysis 21 October 2011
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Epic loss hits class As
The final payment on Epic (Industrious) was made on the 20 October IPD, resulting in a loss on all classes of notes. In particular, it represents the first time that a European formerly-rated triple-A securitised bond has suffered a principal loss.
The final calculation of the credit protection payment on EPICP INDU was determined to be £251.7m, resulting in full .......
News Round-up 21 October 2011
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ICE preps sovereign CDS clearing
ICE Clear Credit is set to launch the clearing of Latin American sovereign credit default swaps on 31 October, making it the first central counterparty to clear sovereign CDS. The SEC has granted regulatory approval for the clearing of sovereign CDS of Argentina, Brazil, Mexico and Venezuela.
"Sovereign CDS are some of the most actively traded CDS products today. We .......
News Round-up 21 October 2011
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Recapitalisation group formed
Tim O'Connor has joined Sandler O'Neill + Partners as md and head of its newly created recapitalisation and advisory services group. The group will provide advice related to recapitalisations and restructurings, primarily to the middle market.
O'Connor was most recently executive md at Gleacher & Company, where he founded its recapitalisation and restructuring group and served as co-head of its .......
Job Swaps 21 October 2011
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Revaluation requirements
Euro CMBS LTV covenants in the spotlight
The European post-crisis precept that servicers should sell the property immediately if a CMBS loan breaches an LTV covenant no longer holds true. But grey areas remain around LTV covenants, especially regarding property valuations.
Recent research from European asset-backed analysts at RBS notes that although commercial real estate market values are generally on the up, material downward revisions to property .......
News Analysis 20 October 2011
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US securitisation issuance passes US$200bn
At the end of September 2011, with more than US$200bn of qualifying securitisation deals completed, the leaders maintained their places in the SCI US league tables for bank arrangers in the structured credit and ABS markets. All added to their account as the month saw US$29bn of issuance.
Europe, meanwhile, dragged itself out of the summer lull to see a shade under .......
News Round-up 20 October 2011
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Devonshire Square extended
The Devonshire Square whole loan securitised in ELoC 26 (Triton), which was due to mature today, has been extended to 23 April 2013. The borrowers and the facility agent have agreed a business plan that includes a covenant by the borrowers to market the property or otherwise refinance the loan by no later than 22 April 2013. The plan also .......
News Round-up 20 October 2011
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Shrinking counterparty eligibility examined
Fitch says the number of banks with sufficiently high ratings to act as eligible counterparties in triple-A rated structured finance and covered bonds transactions has shrunk materially (see also SCI 28 September). This is putting pressure on how easily counterparties can be replaced and on the liquidity of derivative counterparties. It is also increasing concentration risk in an already vulnerable .......
News Round-up 20 October 2011
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Citi settles CDO case
The SEC has charged Citigroup's principal US broker-dealer subsidiary with misleading investors about a US$1bn CDO tied to the US housing market in which Citigroup bet against investors as the housing market showed signs of distress. The CDO defaulted within months, leaving investors with losses while Citigroup made US$160m in fees and trading profits.
The SEC alleges that Citigroup Global .......
Job Swaps 20 October 2011
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Innkeepers settles
Innkeepers USA Trust and its affiliates have reached an updated agreement with Cerberus Series Four Holdings, Chatham Lodging Trust and other related parties, thereby settling the litigation initiated in August (SCI passim). Innkeepers says the agreement is supported by its constituents and clears the way for the sale of 64 Innkeepers hotels to a Cerberus-Chatham joint venture for approximately US$1.02bn.
News Round-up 20 October 2011
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CMBS bid lists wear thin
BWICs have saturated the European secondary CMBS market and already weak dealer bids are getting weaker. Senior paper remains attractive and is drawing in former mezzanine investors, but otherwise activity is muted.
Hedge fund investors have become more interested in senior CMBS, where yields have increased. While senior CMBS remains resilient, client interest in the mezzanine space is far more .......
Market Reports 19 October 2011
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ILS head hired
Michael Popkin has been appointed co-head of insurance-linked securities (ILS) for Towers Watson Capital Markets (TWCM). Based in New York, he will report to Ed Hochberg, head of TWCM.
In his new role, Popkin will assist clients in a wide range of strategic risk management activities surrounding ILS and industry loss warranties. He will also aid in the development and .......
Job Swaps 19 October 2011