Capital Relief Trades

  • Capital relief trades webinar due

    SCI is hosting a complimentary webinar on the current status of capital relief trades. The event is being held at 3pm UK time today (6 September), but will also be available to download from the SCI website afterwards.

    Increased pressure on bank capital requirements in the aftermath of the financial crisis has led to a rise in banks seeking to .......

    News Round-up 6 September 2016

  • Nordea completes synthetic deal

    Nordea Bank has sold a synthetic securitisation referencing €8.4bn in SME and corporate loans. Investors have taken notes linked to the junior credit risk of the portfolio.

    The synthetic structure means no assets will be derecognised from Nordea's balance sheet and Nordea will continue to service the loans. The risk-sharing structure does mean that the bank's CET1 ratio is enhanced, .......

    News 25 August 2016

  • Singular circumstances

    Regulatory changes fuelling rise of 'special situations'

    European banks are fundamentally changing the way they structure and sell securitisations. A rise in bilateral trades and capital relief trades - which, along with increasing non-core asset disposals, is leading some to apply the special situations moniker to the sector - is largely being driven by regulatory changes.

    One of the main trends in European ABS over the last .......

    News Analysis 25 August 2016

  • NPL renaissance

    €9bn Italian ABS provides fresh impetus

    Banca Monte dei Paschi di Siena (MPS) announced last week that it plans to offload its entire portfolio of sofferenze (bad debt) loans into a securitisation vehicle. The move is a significant landmark in the recovery of the Italian non-performing loan ABS market, which the national government has worked hard to revive.

    Banca d'Italia figures put total Italian NPL volume .......

    News Analysis 5 August 2016

  • False alarm?

    Basel CRT warning played down

    The Basel Committee caused somewhat of a stir earlier this month when it warned banks against increasing their use of capital relief trades (CRTs). However, portfolio risk-sharing transactions are not expected to be affected.

    The Committee's statement specifically warned that CRTs would receive "careful supervisory scrutiny" going forward (SCI 3 June). It also indicated that its response was due in .......

    News Analysis 27 June 2016

  • Anchor investment proposed

    The IFC has disclosed that it is considering becoming an anchor investor in United Asia Loan Funding, the Asia-Pacific CLO co-managed by UOB Asset Management and SC Lowy Asset Management (SCI 2 March). The transaction will securitise primarily Asian emerging market loans that were originated by both global and regional banks.

    United Asia Loan Funding is expected to be sized .......

    News Round-up 23 June 2016

  • Capital-arbitrage warning issued

    The Basel Committee has warned banks against conducting capital relief trades. The regulator says such transactions will draw "careful supervisory scrutiny".

    The Basel Committee notes that members have received many requests to review or approve transactions that seek to alter the form or substance of items subject to regulatory adjustments outlined in Basel 3. These include proposals for structured transactions .......

    News Round-up 3 June 2016

  • Spanish synthetics on the cards

    Moody's suggests that synthetic securitisations could become more popular for Spanish banks looking to bolster their capital buffers. With regulatory pressure building on lenders, many may see synthetics as a complement to tapping the equity market or retaining earnings.

    "Northern European players have dominated Europe's synthetic market so far, with the most recent deals originated by banks in the UK, Germany and .......

    News Round-up 6 May 2016

  • Hedging operation

    Debut oprisk ILS prepped

    Credit Suisse is prepping a unique Sfr700m ILS deal. Referred to as OperationalRe, it will utilise catastrophe bond and ILS technology to hedge a portion of the bank's operational risk and is believed to be the first transaction of its kind.

    Although Credit Suisse is reportedly seeking to close the deal by the end of the month, a number of .......

    News Analysis 12 April 2016

  • Risky business?

    Risk-sharing deal opportunities grow

    Capital relief trade opportunities are increasing as more jurisdictions open up. However, with this expansion comes increasing calls for market standardisation.

    Bradley Golding, md at Christofferson Robb & Co, notes that his firm is driven more by its clients' requirements than by any dogmatic approach to particular asset classes. He says: "Our approach [to capital relief trades] is entirely based .......

    News Analysis 2 March 2016

  • Supply and demand

    Capital relief trade pricing, liquidity discussed

    Demand for capital relief trades has outweighed supply in recent years, driving prices lower, according to panellists at SCI's inaugural capital relief trades conference in December. Liquidity remains thin, however, and the spectre of volatility is appearing on the horizon.

    Juan Grana, md of structured solutions at Nomura, says that demand for capital relief trades has outweighed supply, which has .......

    News Analysis 26 February 2016

  • Synthetic disorder

    Risk transfer deals seek regulatory breakthrough

    Panellists at SCI's inaugural capital relief trades conference last month discussed regulatory developments in the sector and the push towards accommodating synthetic securitisations under the new umbrella of standardisation. However, doubts persist over the viability of harmonisation in such a diverse market.

    "The capital requirements regulation (CRR) has made some good progress with addressing harmonisation in detail, but there still .......

    Talking Point 27 January 2016

  • Fund offers core assets access

    AXA Investment Managers has launched a fund offering investors access to the core lending activity of major European commercial banks. The AXA IM Partner Capital Solutions fund raised €230m last year.

    As banks increase lending to their core professional clients, regulatory requirements to provide more upfront capital provide an opportunity for capital relief trades where the fund identifies suitable lending portfolios .......

    Job Swaps 12 January 2016

  • Capital relief deal agreed

    Dutch pension fund PGGM and Banco Santander have entered into a risk-sharing transaction regarding a €2.3bn portfolio of SME loans originated in Spain. The portfolio of the synthetic transaction consists of more than 6,000 Santander loans to its clients and will see PGGM sell credit protection against potential losses on a portion of the loans.

    Mascha Canio, head of credit and insurance-linked .......

    News Round-up 12 January 2016
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