CMBS

  • Residual value buffer provided

    Sector developments and company hires

    Residual value buffer provided
    Volkswagen Financial Services UK will calculate a collateral residual value buffer to be made available to its UK auto ABS issuers in respect of the monthly period in which a payment holiday with a term extension is granted for a purchased receivable. The collateral RV buffer will be £300 for each purchased receivable in respect of which .......

    Market Moves 11 May 2020

  • Pipeline clearance

    Structural features support CMBS

    The US non-agency CMBS market appears to have stabilised, allowing sponsors to clear out existing pipelines, following structural tweaks in some cases. The sole conduit deal to print last month - Cantor Fitzgerald’s US$271m CF 2020-P1 – lacked senior/junior triple-A classes, while Blackstone’s BX 2020-VIVA has been restructured.

    Notably, the A, B, C and X classes of notes initially contemplated .......

    News 7 May 2020

  • STS synthetics proposals published

    Sector developments and company hires

    STS synthetics proposals published
    The EBA has published its proposals for developing an STS framework for synthetic balance-sheet securitisations, which includes the criteria to be considered when labelling a transaction as ‘STS' and provides the pros and cons of a potentially differentiated capital treatment for this type of securitisation. Among the proposed STS criteria are requirements on simplicity, standardisation and transparency .......

    Market Moves 6 May 2020

  • Ladder locks in financing

    Sector developments and company hires

    Ladder locks in financing
    Ladder Capital has entered into a strategic financing arrangement with Koch Real Estate Investments, under which Koch will provide the company with approximately US$206.4m in senior secured financing to fund transitional and land loans. As part of the strategic financing agreement, Koch has the right to make a US$32m equity investment in the Ladder at any time .......

    Market Moves 5 May 2020

  • WAM guidelines finalised

    Sector developments and company hires

    WAM guidelines finalised
    The EBA has published its final guidelines on the determination of the weighted average maturity (WAM) of the contractual payments due under the tranche of a securitisation transaction, as laid down in the CRR. These guidelines aim at ensuring that the methodology applicable for the determination of the WAM for regulatory purposes is sufficiently transparent and harmonised .......

    Market Moves 4 May 2020

  • MBS overvaluation case settled

    Sector developments and company hires

    Overvaluation case settled
    The US SEC has accepted an offer of settlement from Semper Capital Management in connection with administrative and cease-and-desist proceedings against it. On the basis of the offer, the Commission finds that from July 2013 through May 2014, Semper overvalued certain odd lot positions in securities held by the Semper MBS Total Return Fund (SEMMX), which caused .......

    Market Moves 1 May 2020

  • Targeted action

    Wholesale ratings downgrades questioned

    The raft of negative rating actions currently hitting the securitisation market is perceived to be driven by the stress created by coronavirus containment efforts. To the extent that some credit ratings were heading for a downgrade before the pandemic, this stress may simply be hastening rating actions. However, there are some who question whether wholesale downgrades are helpful in the .......

    News Analysis 1 May 2020

  • Prudential flexibility reiterated

    Sector developments and company hires

    Prudential flexibility reiterated
    The European Commission has adopted a package to help facilitate bank lending to households and businesses throughout the European Union that includes an Interpretative Communication on the EU's accounting and prudential frameworks, as well as targeted ‘quick fix’ amendments to the CRR, in order to maximise the ability of banks to lend and absorb losses related to .......

    Market Moves 29 April 2020

  • Securitisation support

    AOFM initiatives to boost volumes

    The Australian Office of Financial Management has acted quickly to support the Australian securitisation market amid the coronavirus fallout. Indeed, a boost to both primary and secondary ABS volumes is expected as a result of its A$15bn Structured Finance Support Fund (SFSF) initiative (SCI 30 March) and the proposed Forbearance SPV respectively.

    Martin Jacques, director, head of .......

    News Analysis 28 April 2020

  • European SME ABS struggling

    Sector developments and company hires

    European SME ABS struggling
    Coronavirus-driven disruption is creating financial difficulties for European SMEs that heavily rely on securitisations for funding. Consequently, the crisis and subsequent recession will challenge the asset quality of SME ABS, according to a new report from Moody’s.

    “There is a widespread lack of financial strength and fewer financing options among SMEs, relative to large corporate .......

    Market Moves 27 April 2020

  • Stalwart Canadians

    Canadian CMBS better positioned than US

    There is some evidence that the Canadian CMBS market is in a better state to ride out the turbulence of the Covid 19 crisis than the US market, suggest analysts.

    “Taking the base case scenario (that the recovery will begin at the beginning of 2021) the Canadian CMBS market is better positioned. It’s not just a matter of .......

    News 24 April 2020

  • Non-agency CMBS goes it alone

    The non-agency CMBS market is an orphan of the storm

    While a raft of measures to aid liquidity and forestall insolvency have been introduced by the US authorities to asset-backed markets in recent weeks, the non-agency CMBS sector remains outside the umbrella, leading to fears it faces huge losses.

    GSE-backed CMBS are considered eligible as collateral under the terms of TALF 2.0, while in the private label sector .......

    News Analysis 24 April 2020

  • Grandfathering for Dutch CLO issuers

    Sector developments and company hires

    Grandfathering for Dutch CLO issuers
    The Dutch tax authorities have provided written confirmation to CLO issuers domiciled in the Netherlands that their recently revised position on the VAT exemption (SCI 10 March) will not apply with retroactive effect. Further, the VAT exemption will continue to apply to transactions for a grandfathering period until 1 January 2021. Issuers are continuing a .......

    Market Moves 23 April 2020

  • GSE advancing obligations aligned

    Sector developments and company hires

    GSE advancing obligations aligned
    The US FHFA has aligned Fannie Mae's and Freddie Mac's policies regarding servicer obligations to advance scheduled monthly principal and interest payments for single-family mortgage loans. Once a servicer has advanced four months of missed payments on a loan, it will have no further obligation to advance scheduled payments. When a mortgage loan is in an .......

    Market Moves 22 April 2020

  • Moody's puts CLOs under review

    Sector developments and company hires

    Moody’s puts CLOs under review
    Moody's has placed on review for downgrade its ratings on 859 tranches issued by 358 US BSL CLOs (plus another 25 linked US CLO combo notes, secured notes and repacks) and 117 tranches issued by 39 European BSL CLOs. The affected securities represent 19% of Moody's US-rated BSL CLOs and 14% of its European-rated CLOs.

    Market Moves 20 April 2020

  • Bright spot?

    European logistics gaining momentum

    The logistics sector is set to be a bright spot in European commercial real estate post Covid-19. Coronavirus impacts represent one of six fundamental factors behind the sector’s momentum, according to Scope Ratings, alongside growth in e-commerce, end-customer demands, supply chain optimisation, a supply-demand/supply imbalance and new urban developments.

    The agency suggests that these factors are strongly supportive .......

    News 20 April 2020

  • CMBS secured, unsecured sub debt weighed

    Sector developments and company hires

    CMBS secured, unsecured sub debt weighed
    Senior US CMBS loans with unsecured subordinate debt (such as mezzanine or preferred equity) show significantly lower default rates than senior loans with secured subordinate debt (such as B-notes) at comparable leverage points, according to Fitch. The agency evaluated the performance of 1,001 senior CMBS conduit loans with subordinate debt in place, issued between 2003 .......

    Market Moves 16 April 2020

  • Unified approach

    Canadian CMBS servicing challenges surveyed

    The Canadian CMBS market is expected to be more resilient to the coronavirus fallout than its US counterpart. Although tenant defaults and loan delinquencies are similarly likely to spike into 3Q20, to date Canadian servicers have seen relatively few borrower relief requests.

    Unique to the Canadian CMBS market, borrower requests for relief are initially reviewed by the subservicer .......

    News 16 April 2020

  • Forbearance foreseen

    Euro CMBS cash-trap thresholds eyed

    Three UK hotel CMBS and three Italian retail CMBS, representing just under £1bn and just over €1bn of securitised debt respectively, could become subject to cash-trapping if their LTV ratios are tested during the Covid-19 outbreak. However, should loan defaults occur, special servicers are likely to exercise forbearance while conditions improve.

    The three hotel CMBS – Helios (ELoC .......

    News Analysis 14 April 2020

  • TALF 2.0 eligibility expanded

    Sector developments and company hires

    TALF 2.0 eligibility expanded
    The US Fed has expanded the range of assets that are eligible collateral for TALF 2.0 to include the triple-A rated tranches of both legacy conduit CMBS and newly issued static CLOs. The size of the facility will remain US$100bn and it will continue to support the issuance of ABS that fund a wide range of .......

    Market Moves 9 April 2020

  • EIF calls for guarantee applications

    Sector developments and company hires

    EIF calls for guarantee applications
    The European Commission has unlocked €1bn from the European Fund for Strategic Investments (EFSI) that will serve as a guarantee to the EIF and allow it to issue special guarantees to incentivise lenders to provide liquidity to at least 100,000 European SMEs and small mid-cap companies hit by the economic impact of the coronavirus pandemic, .......

    Market Moves 8 April 2020
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