CMBS
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Maturing prospects
Self-storage loans show highest refi rate
The 10-year Treasury rate closed the month at 2.33%, following the rate hike in mid-March. With the US Fed indicating that six more rate hikes are likely this year, KBRA analysed the refinancing prospects of US CMBS conduit loans that mature through 2023 and found that approximately 60% can successfully refinance with a first mortgage without the need for .......
News 4 April 2022
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Cautious optimism
European ABS/MBS market update
Following a clear pick-up in activity last week, the European and UK primary ABS/MBS markets have carried over that dynamism into this week. Optimism is, it seems, back on the cards for now.
“Well, I think things are much more positive,” states one European ABS/MBS trader. “We have seen a big turnaround in the market, where a lot .......
News 1 April 2022
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Quality control
Call for ESG data improvements
The lack of clear, unified standards continues to constrain the wider adoption of ESG securitisation in the EU. In order to fulfill investor demand for such product, both the quality and quantity of ESG data needs to improve, according to panelists at SCI’s recent ESG Securitisation Seminar.
Andrew Lennox, portfolio manager at Federated Hermes, pointed out that pricing .......
News Analysis 30 March 2022
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Sixth Street establishes structured products business
Sector developments and company hires
Sixth Street has announced the formation of a dedicated structured products business to further enhance its capabilities as a strategic capital partner and solutions provider at scale. Sixth Street structured products builds upon the firm’s existing expertise and will focus on asset and platform investing and origination across finance markets, including commercial and residential mortgages, renewables and energy finance, consumer .......
Market Moves 29 March 2022
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Window of opportunity
European ABS/MBS market update
This week is seeing clear evidence of a pickup in activity in the European and UK ABS/MBS primary markets. In what feels like an intermediate period of opportunity for issuers, the announcement of a flurry of transactions should test investor appetite and overall market conditions.
“After a period that saw huge levels of issuance for covered bonds, our .......
News 23 March 2022
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Wrapped ratings upgraded
Sector developments and company hires
Moody's has upgraded the ratings of 148 classes of US structured finance securities wrapped by Assured Guaranty Municipal (AGM), Assured Guaranty (AGC) and their affiliated insurance operating companies, as well as one class of US securities wrapped by AGM. The securities impacted include certain RMBS and ABS notes. The move follows Moody's upgrade of the insurance financial strength (IFS) .......
Market Moves 23 March 2022
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Inequitable frameworks
Data analyses demonstrate punitive ABS treatment
AFME has published two independent data analyses, undertaken by Risk Control, in response to the European Commission’s call for advice regarding bank and insurance prudential capital treatment and the liquidity coverage ratio (LCR). Both reports demonstrate that the current European regulatory framework is disproportionately punitive for securitisation.
One of the Risk Control analyses examines the relative risk of .......
News Analysis 22 March 2022
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Equitable Holdings subsidiary to acquire CarVal Investors
Sector developments and company hires
Equitable Holdings has announced the acquisition of CarVal Investors by its subsidiary, AllianceBernstein. The agreement to acquire the global private alternative investment manager with US$14.3bn in AUM falls in line with Equitable Holdings’ strategy to further its differentiated business model and increase returns. CarVal focuses on opportunistic and distressed credit, as well as renewable energy infrastructure, speciality finance, and transportation .......
Market Moves 18 March 2022
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Barrow Hanley closes inaugural CLO equity fund
Sector developments and company hires
Barrow Hanley Global Investors has closed on its inaugural CLO equity fund – the Barrow Hanley CLO Fund I LP. The fund will be managed by the existing alternative credit team and follows the aims of the firm’s strategic partner, Perpetual Limited, to expand the product offering at Barrow Hanley. Perpetual, alongside employees at Barrow Hanley, have invested 35% of .......
Market Moves 17 March 2022
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IGLOO SME scheme unveiled
Sector developments and company hires
The EIF is supporting the Italian Guaranteed Loan Origination Platform (IGLOO), a new state-backed initiative that aims to provide €170m in opportunities for growth and financing for at least 800 SMEs and mid-caps in Italy. Promoted by Gruppo MutuiOnline and Gruppo NSA, the platform has a particular focus on criteria relating to climate transition and environmental sustainability.
The EIF will participate via .......
Market Moves 15 March 2022
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What makes an efficient CLO manager?
Phil Raciti, head of performing credit and a portfolio manager at Bardin Hill, explains the key attributes needed to be successful as a CLO manager
The CLO asset class operates within a sophisticated construct of arbitrage, leverage, and structural protections. Having navigated multiple recessions and the most significant period of issuer downgrade activity on record in 2020, the asset class has .......
Talking Point 14 March 2022
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Some stabilisation
European ABS/MBS market update
The European and UK ABS/MBS markets saw some elements of stabilisation in the last few sessions of last week. Nevertheless, spreads continue to widen in both a very active secondary and a quiet primary space.
The secondary market saw its busiest week of 2022, with over €350m paper on BWIC and dealers reporting healthy bilateral activity as well. As the .......
News 14 March 2022
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Ratings furore
Industry pushback throws into doubt S&P CMBS ratings action
S&P this week agreed to push back the RFC period for its proposed changes to ratings for securitized securities held by insurers from March 18 to April 29.
This is the second extension to the time allowed for the RFC, which was initially set to end on February 18 when the mooted adjustments were first announced on early December 2021.
In a conference call on .......
News 10 March 2022
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Growing presence
Mia Drennan, president, founder and co-chair of GLAS, answers SCI's questions
Q: What is your strategic vision for GLAS and its continued expansion and growth in the US?
Provider Profile 10 March 2022
A: GLAS was founded in 2011 and we expanded into the US in 2016. Once we secured the necessary regulatory licenses and approvals to operate in the US, we began serving clients on a cross-border basis across the UK, Europe, Australia and the .......
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Carlyle tops rankings on CLO acquisition
Sector developments and company hires
Carlyle is set to acquire from CBAM Partners a portfolio of assets using a combination of US$615m in cash from Carlyle’s balance sheet and approximately 4.2 million newly issued common shares. CBAM’s US$15bn in assets under management - the majority of which are in CLO funds - will be integrated into Carlyle’s global credit platform. The transaction will increase .......
Market Moves 10 March 2022
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Coordinating outfit
ESG advisors gaining traction
ESG advisors are gaining traction in the securitisation market, as sustainability becomes an ever-more import consideration for investors and issuers. This Premium Content article investigates what the role entails.
As sustainability becomes an ever-more important consideration for securitisation investors and issuers, the role of the ESG advisor on transactions is gaining traction. Not only do they assist issuers in ......
News Analysis 10 March 2022Premium Content
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Expectation gap
European ABS/MBS market update
Macro volatility continued to push European and UK ABS/MBS spreads wider last week in a quiet secondary market, with activity further hampered by differences in participants’ expectations. Meanwhile, the primary market remains side-lined.
“As the escalation of the crisis in Ukraine fuels further deterioration in the technical backdrop for financial markets, European ABS spreads extended their sell-off in .......
News 7 March 2022
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SLC continues expansion
Sector developments and company hires
SLC Management has promoted Bryan Rowe, Daniel Lucey, Jacqueline Gallant and Jeffery Meyer as the firm continues to expand its business and investment capabilities. Effective from 26 March, the four will work as senior mds at the firm. Firstly, Rowe has been promoted to senior md for global portfolio management, having spent more than 15 years at the firm, and .......
Market Moves 3 March 2022
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Transitioning to green
Call for EU GBS to be extended to securitisation
In a new report examining how to foster transparency and credibility across the EU sustainable securitisation market, the EBA suggests that it would be “premature” to establish a dedicated framework for ‘green’ securitisation. Instead, the authority believes that the forthcoming EU Green Bond Standard (GBS) regulation should also apply to securitisation, providing some adjustments are made to the standard.
News Analysis 2 March 2022
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Feedback loop
CRE CLO confluence to continue?
US CRE CLO issuance volumes exceeded conduit CMBS issuance volumes for the first time ever last year. Such record growth, illustrated through 51 deals across 28 issuers - amounting to around US$45bn – underlines a shift in commercial real estate financing towards floating rate loans and transitional properties.
“It has clearly been a record year for the [CRE .......
News Analysis 2 March 2022
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Team building
Brian Roelke, president and cio of Kuvare Insurance Services, answers SCI's questions
Q: What were the motivations behind the launch of Kuvare Insurance Services’ new third-party asset management business (SCI 8 February)?
The Structured Credit Interview 2 March 2022
A: Unlike a lot of entrants into this space, Kuvare Insurance Services (KIS) started as an insurance-focused asset manager, as all of our activities today are focused on our affiliated insurance balance sheets. The announcement of the new platform signifies .......