NPLs

  • Turning the corner?

    Growing optimism in European CMBS market

    It has been a tough couple of years for European CMBS, but there are signs that the environment may be changing. Primary issuance is likely to pick up this year, while the rate of enforcements is expected to shrink as borrowers become more engaged and look to achieve orderly workouts.

    Primary issuance has been widely forecast to reach between €5bn .......

    News Analysis 18 February 2013

  • Euro CMBS deterioration highlighted

    The credit quality of European CMBS pools is expected to deteriorate in 2013. Moody's says that further losses on secondary properties will be unavoidable and exacerbated by the €16bn refinancing wall, which peaks next year when 135 loans will require refinancing.

    At the same time, overall new issuance will remain muted. Moreover, the rating agency anticipates that most collateral pools .......

    News Round-up 13 December 2012

  • Sareb framework unveiled

    Further details have emerged about Sareb, Spain's bad bank (SCI 18 October). The vehicle will purchase up to €90bn of real estate assets from Group 1 and 2 banks.

    Group 1 banks - Bankia, Banco de Valencia, Catalunya Caixa and NovaCaixaGalicia - will transfer around €45bn of assets, with the remainder coming from Group 2 banks in 2013. The assets .......

    News Round-up 31 October 2012

  • FDIC structured sale closed

    The FDIC has closed the fourth sale in its Small Investor Program, involving a competitive bidding process for an equity interest in a limited liability company. The LLC was formed by the FDIC in its receivership capacity to hold certain assets of the failed Tennessee Commerce Bank, which was closed on 27 January.

    The FDIC placed a pool of 93 .......

    News Round-up 22 October 2012

  • Isobel CMBS slammed

    Moody's notes that it would not have assigned a Aaa rating to Isobel Finance No.1, the first non-performing real estate loan portfolio CMBS transaction to come to market in EMEA (SCI 4 October). The agency says that the deal is not compatible with a Aaa rating because of the quality of the assets, its extra leverage due to swap termination .......

    News Round-up 18 October 2012

  • RBS debuts legacy loan deal

    Further details have emerged on Isobel Finance No.1, the £463.22m CMBS that RBS preplaced last week. The transaction represents the first use of CMBS technology in Europe post-financial crisis to partially fund the purchase of legacy commercial real estate loans from a bank balance sheet.

    The deal securitises a £553.3m senior loan that RBS made to Isobel AssetCo, as borrower, .......

    News 4 October 2012

  • Releasing the pressure?

    Data hindering European distressed debt deals

    Differing views on price appear to be impeding distressed debt transaction volume in Ireland and Spain, albeit a number of significant deals are expected to close by year-end. Nevertheless, recent legislative developments are helping to relieve some of the pressure that banks face in both jurisdictions.

    Getting comfortable with a distressed debt deal in Ireland and Spain comes down to .......

    News Analysis 12 September 2012

  • Managed NPL deal prepped

    Further details have emerged about Oaktree Capital Management's non-performing loan CMBS (SCI 19 August). Dubbed ORES NPL series 2012-LV1, the transaction will be managed by Sabal Financial Group.

    The deal - which is arranged by JPMorgan - comprises a US$195m single tranche of notes rated triple-B minus by Fitch. The pool consists of 615 performing and non-performing real estate secured .......

    News Round-up 10 September 2012

  • NPL portfolio acquired

    Sabal Financial Group has acquired a non-performing CMBS loan portfolio from CWCapital. The underlying real estate assets are located across the US.

    Sabal will provide loan servicing and asset management for the portfolio. The firm says it is rapidly expanding its operating platform in response to the growing market of performing and non-performing loan portfolios for sale and an increase .......

    News Round-up 28 August 2012

  • NPL issues

    Bad debt securitisations gaining traction

    The first post-financial crisis non-performing loan CMBS - Rialto 2012-LT1 and S2H 2012-LV1 - have proved popular with investors looking for short duration, high coupon bonds. However, the growth of the sector is expected to be limited by the paucity of distressed assets coming onto the market at present.

    William O'Connor, partner at Thompson & Knight, reckons that the current .......

    News Analysis 10 August 2012

  • Greek rating actions announced

    Fitch has affirmed 23 and downgraded six tranches of Greek RMBS. It has also maintained three tranches on rating watch negative (RWN).

    The downgrades reflect the performance of the collateral and the deteriorating Greek mortgage market, as well as the existing moratorium on foreclosure activity in the country, which has lengthened foreclosure timings and is limiting the level of recoveries .......

    News Round-up 10 August 2012

  • Rental market

    REO-to-rent securitisation generates interest

    The US government is keen to find a way to unload the foreclosed REO properties currently owned by Fannie Mae and other GSEs. REO-to-rent securitisation could play a leading role in tackling the overhang.

    S&P estimates that around 500,000 properties were REO at the end of 1Q12, with this figure expected to rise over the next few years. A further .......

    News Analysis 25 July 2012

  • Spanish 'bad bank' welcomed

    The Spanish government last week announced the second phase of the Royal-Decree-Law of 3 February, which details its plan to resolve the country's banking crisis.

    Among the proposed measures is that general provisions on real estate exposure will increase to 30% from 7%, an extra €30bn, before year end. This is in addition to the €53.8bn already announced.

    The government .......

    News Round-up 14 May 2012

  • EMEA CMBS loan transfers continue apace

    The total number of loans in special servicing across EMEA CMBS large multi-borrower and single-borrower transactions monitored by Moody's decreased by one loan to 132 as of end-March, according to the agency's monthly update on the sector. Two loans were newly transferred during the month, while three loans have been removed from special servicing as their workouts were completed.

    Among .......

    News Round-up 23 April 2012

  • Rise in NPL CMBS volume predicted

    The recent Rialto securitisation of non-performing commercial real estate (CRE) loans represents the beginning of a trend, according to Fitch, given the volume of distressed CRE lingering with servicers and lenders and the increased use of loan sales to dispose of troubled CRE loans.

    Since 1Q09, US$161bn of CMBS loans have been transferred to special servicing and, since 2010, the .......

    News Round-up 19 April 2012

  • Minimal EMEA ABS impairments recorded

    Moody's says that EMEA ABS has performed as expected since the onset of the financial crisis. Between 1January 2007 and 31 December 2011, the migration of investment grade securities to impairment/default was minimal.

    Twenty-three EMEA ABS tranches rated investment grade at closing across 14 transactions became impaired during the period, amounting to 1% of 2,127 investment grade EMEA ABS tranches .......

    News Round-up 17 April 2012

  • Rehab SLABS liquidity risk warning

    Fitch believes that the increase in rehabilitated student loans in some recent FFELP ABS transactions heightens near-term liquidity risk, despite the US government guarantee on these loans.

    Rehabilitated student loans are those in which the borrower defaults but subsequently makes nine on-time payments during 10 consecutive months. In these situations, the collection costs - up to 18.5% of the outstanding .......

    News Round-up 10 April 2012

  • NPL CMBS hits the market

    The first US non-performing CMBS in over a decade - Rialto Capital series 2012-LT1 - has hit the market. The US$132m transaction is collateralised by 271 mortgage loans securing 266 properties, 11 unsecured loans and 38 REO properties.

    The total unpaid principle balance (UPB) of the loans and properties represented in the pool is US$526.1m. The sponsor - Rialto Capital .......

    News 30 March 2012

  • Mexican RMBS criteria updated

    Fitch has updated its rating methodology for assessing credit risk in Mexican residential mortgage loan pools originated by banks and Sofoles/Sofomes that are used as collateral for structured finance transactions. The changes focus on loss given default (LGD) assumptions and primarily reflect the agency's view for a prolonged recovery process and discounted sales levels predicted for the coming years.

    The .......

    News Round-up 19 March 2012

  • CRE auction activity continues

    Large 'geo-series' CRE sales posted on auction.com helped drive US CMBS conduit liquidation volumes in 2011. The signs are that in the first part of this year at least they will continue to have a major impact on the sector.

    Auction.com has already listed property-level details for three large note/REO auctions for 1Q12. Scheduled for February and March, they account .......

    News 10 February 2012

  • Euro CMBS NPL warning

    Tiering within European CMBS is gradually forcing the best and the worst loans to leave the universe. Absent new primary issuance, this trend could result in European CMBS morphing into a non-performing loan asset class in which the securitised collateral is either in default or 'passed initial maturity' status.

    European CRE investment and lending markets are characterised by significant tiering, .......

    News 27 January 2012
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