Complete news archive

  • Sovereign, Euro ratings 'impossible' to de-link

    According to Fitch, it is impossible to completely de-link the ratings of eurozone securitisation transactions from those of the relevant sovereign.

    Marjan van der Weijden, md and head of EMEA ABS at Fitch, says: "Increased sovereign default risk can affect the performance of securitisations in various ways, as it bears negatively on the macroeconomic environment and raises the prospect of .......

    News Round-up 8 September 2010

  • BMF drafting errors corrected

    Amendments have been proposed to correct a drafting error in the documentation for the Business Mortgage Finance No. 1 to No. 7 transactions. All classes of notes issued by these deals, except the MERC notes, will be subject to the amendments.

    Each class of MERC notes features a regular coupon that is paid as long as it is outstanding, as .......

    News Round-up 8 September 2010

  • Investable ILS tracker fund planned

    Partners Group Holding affiliate Alternative Beta Partners is filling the gap between tracking liquid ILS and actually investing in an ILS fund. The Swiss asset manager is planning on launching a cat bond tracker fund alongside its newly launched ILS index.

    "We are able to start up a fund pretty quickly. We are waiting basically to see how interest comes .......

    News 1 September 2010

  • Credit event determinations activity spikes

    ISDA's Americas Determinations Committee has determined that a bankruptcy credit event occurred with respect to Boston Generating on 18 August. EBG Holdings, its principal operating subsidiary Boston Generating and its five other wholly owned subsidiaries filed a voluntary petition under Chapter 11 in the US Bankruptcy Court for the Southern District of New York.

    Boston Generating is an index constituent .......

    News Round-up 1 September 2010

  • Window of opportunity to redeem Trups

    A three-month window for banks to redeem their Trups at face value has been opened by the Dodd-Frank Act. Moody's notes in its Weekly Credit Outlook that, should banks redeem their Trups, CDOs backed by them will benefit from the reduction of default risk in their collateral portfolios.

    The window applies to bank holding companies with more than US$15bn of .......

    News Round-up 1 September 2010

  • Aussie ADIs given reg cap warning

    The Australian Prudential Regulation Authority (APRA) has issued a notice to domestic authorised deposit-taking institutions (ADIs) in connection with securitisation regulatory capital treatment. The move comes after the Authority reviewed a number of securitisation self-assessments it had requested under Prudential Standard APS 120 Securitisation.

    APRA notes that a number of ADIs originated securitisations under which the senior tranche or tranches .......

    News Round-up 1 September 2010

  • Bank fined for unsuitable CMO sales

    FINRA has fined HSBC Securities (USA) US$375,000 for recommending unsuitable sales of inverse floating rate CMOs to retail customers. HSBC failed to adequately supervise the suitability of the CMO sales and fully explain the risks of an inverse floating rate or other risky CMO investment to its customers, according to the complaint.

    As a result, six of HSBC's brokers made .......

    Job Swaps 1 September 2010

  • Tough choices ahead in GSE reform

    The rehabilitation of Fannie Mae and Freddie Mac began with the US Treasury's conference on the future of housing finance (see last issue), according to Deutsche Bank ABS analysts. The conference appears to have established a consensus on how the GSEs should look going forward.

    The consensus includes:

    • The MBS guarantee business being re-launched, backed by catastrophe insurance from .......

    News Round-up 1 September 2010

  • Help wanted

    ABS recruitment begins to pick up as market returns

    After a couple of difficult years in structured finance, 2010 has hinted at a return to normality as the market starts to recover and banks begin to rebuild their teams. Demand is strong for sales people, but other roles - such as analysts - are not yet seeing an up-tick.

    One London head-hunter says: "I think we have entered a .......

    News Analysis 1 September 2010

  • Multi-property reprieve

    REMIC grandfathering to assist servicers

    CMBS servicers and borrowers with distressed multi-property loans received a reprieve from confusing IRS regulations last month. Almost a year after the IRS initially made changes to REMIC rules, it issued Revenue Procedure 2010-30 to clear up loose ends.

    When the changes that were published last September came out, they were perceived as a "big game changer for the industry", .......

    News Analysis 1 September 2010

  • Repurchase requests

    Troubled loan buy-backs on the rise

    A raft of troubled mortgages is being returned to their originators, as Fannie Mae and Freddie Mac exercise their put-back options. The GSEs are believed to be returning to the four largest US banks alone around US$10.7bn of loans, which they deem to have breached their representations and warranties.

    The FHFA has issued 64 subpoenas to mortgage originators to ascertain .......

    News Analysis 1 September 2010

  • Mixed resolutions for maturing CMBS

    An analysis by Moody's of five-year loans bundled in conduit/fusion CMBS that have matured so far in 2010 shows roughly 70% have had favourable resolutions, with worse outcomes for the remaining 30%. The agency believes the results are indicative of what will be seen over the next year.

    753 conduit/fusion loans with original 60-month terms, totalling US$17.7bn, are scheduled to .......

    News Round-up 1 September 2010

  • Pension Trust CDS takes further knock

    Moody's has taken rating action on a CSO referencing a managed portfolio of synthetic credit corporate entities. The US$100m credit default swap was between Goldman Sachs and GM Salaried Employees Pension Trust.

    The US$100m mezzanine tranche was cut to C from Ca. The action was taken since the tranche balance was reduced to zero due to credit events. The transaction .......

    News Round-up 1 September 2010

  • Marginal dip in CLO concentration risk

    Obligor concentration risk decreased marginally among S&P's outstanding rated US cashflow CLO transactions in the second quarter of 2010. Exposure to the top 250 corporate loan obligors decreased to 55% from 57% of the outstanding principal balance for US CLOs between the first and second quarters.

    Although there were marginal shifts in the ranks of the top 10 corporate obligors .......

    News Round-up 1 September 2010

  • CRE price consensus developing?

    Moody's latest REAL Commercial Property Price Indices show that US commercial real estate prices declined by 4% in June, leaving prices 41.4% below the peak recorded in October 2007. However, this is still 4.2% above the recession low that occurred in October 2009.

    The decline followed two months of price increases, as performance remains choppy. In the first half of .......

    News Round-up 1 September 2010

  • EMEA CMBS special servicing set to rise

    By end-July, Moody's reported 64 loans in special servicing across all EMEA CMBS large multi-borrower and single-borrower transactions. During the month, seven loans were newly transferred into special servicing, while three loans were removed.

    Of the seven new loans, three of them were transferred into special servicing due to non-payment at maturity and one loan was transferred due to non-payment .......

    News Round-up 1 September 2010

  • Pain ahead for US CMBS

    Fitch reports that 126 US CMBS loans will mature in September, with 43% of them already in special servicing. Senior director at the agency, Adam Fox, says the majority of maturing loans already in special servicing are either delinquent or in foreclosure.

    The US$962m of CMBS coming due this month will serve as a foretaste for the final quarter of .......

    News Round-up 1 September 2010

  • Defeasance activity increasing

    Improvements in liquidity and investor confidence in the CRE sector are reflected by increased defeasance activity, says Moody's. A new report by the agency looking at defeasance activity of loans in CMBS transactions for the first six months of 2010 found that activity was almost 300% higher than in the same period in 2009.

    "Although the recent level of defeasance is .......

    News Round-up 1 September 2010

  • Lease accounting proposal neutral for Aussie issuers

    According to Moody's, a proposal released by the IASB and FASB in connection with leasing rules are currently ratings-neutral for Australian issuers.

    Ian Lewis, Moody analyst and vp, says: "Moody's already accounts for almost all lease liabilities through standard adjustments to balance sheets, profit-and-loss statements and cashflow accounts."

    He adds: "As such, the proposed changes would have limited implications for .......

    News Round-up 1 September 2010

  • Dutch RMBS restructuring completed

    Achmea Hypotheekbank has restructured and priced its previously retained prime RMBS, DMPL VI, via Deutsche Bank, RBS and JPMorgan. A JPMorgan affiliate purchased €500m of the €653.1m triple-A rated 4.19-year class A tranche at 126bp over three-month Euribor.

    S&P confirmed that its credit rating on the class A notes is unlikely to be affected by the restructuring of the transaction, .......

    News Round-up 1 September 2010

  • Stability predicted for Aussie ABS and MBS

    Moody's reports a stable outlook for the performance of collateral in Australian ABS, CMBS and RMBS over the next 12 to18 months.

    Moody's vp and senior credit officer, Richard Lorenzo, says: "We expect that the up-to-now strong appreciation in housing prices will slow down a bit, but undersupply - as well as net migration - will continue to support prices."

    News Round-up 1 September 2010

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