RMBS

  • CFPB rules take centre stage

    From a US residential mortgage servicing perspective, last year will be remembered as a year of regulation and consolidation. However, going into 2014 the Consumer Financial Protection Bureau (CFPB) will take centre stage as the ability-to-repay (ATR), qualified mortgage (QM) and servicing rules go into effect, according to DBRS.

    The agency believes that the issuance of the ATR and QM .......

    News Round-up 20 January 2014

  • Solid execution seen for IABF sale

    The Dutch State Treasury Agency completed its second IABF sale yesterday (16 January). The auction comprised 360 individual securities totalling approximately US$4.27bn current face (SCI 13 January), which will leave the portfolio with just US$2.2bn remaining exposure.

    BWIC execution appeared solid and approximately 29 of the bonds out for the bid had observable re-offer levels in the immediate wake of .......

    News Round-up 17 January 2014

  • SFR structuring innovation unveiled

    FeatherStone Investment Group says it has designed a new class of security that will allow qualified institutional buyers to participate in the equity-like returns of single-family rental securitisations without a long-term capital commitment to the sector. Dubbed a residual tracking tranche (RTT), it is anticipated to have a three- to five-year maturity based on the longest issued debt tranche within .......

    News Round-up 16 January 2014

  • Ocwen settlement to hurt investors

    S&P suggests that the potential impact of the Ocwen servicing settlement (SCI 23 December 2013) on US RMBS transactions is similar to that of JPMorgan's settlement with the Department of Justice (SCI 17 December 2013). As such, investors are expected to bear the losses that result from modifications executed under the agreement.

    Ocwen last month entered into an agreement with .......

    News Round-up 15 January 2014

  • Statute of limitations in focus

    S&P says that investor recourse may be limited with or without sunset representation and warranty provisions, following the ACE Appellate ruling (SCI 7 January). As such, to mitigate the potential impact of limited post-default remedies, the agency expects prudent investors and market participants to consider any applicable statute of limitations (SOLs) and continue to focus on upfront due diligence.

    The .......

    News Round-up 15 January 2014

  • REIT vet joins CRE advisory

    Situs has grown its West Coast team with the appointment of Eric Smith as business development leader. He will be based in San Francisco and report to Kenneth Segal and Eric Lindner.

    Smith also currently serves as an independent director at KBS Strategic Opportunity REIT. He has 25 years of experience in the industry, having previously worked at Loan Value .......

    Job Swaps 15 January 2014

  • Law firm promotes real estate pair

    Danielle Schechner has been elected to partner in the real estate group of Pryor Cashman, while Benjamin Teig has been named as of counsel. Both are based in New York.

    Schechner has been at the firm since 2006. She has also worked at Millennium Inorganic Chemicals and Fried Frank.

    Teig focuses on commercial real estate and was previously a real .......

    Job Swaps 15 January 2014

  • Bright spots

    Mixed fortunes in structured finance recruitment

    Certain areas of the structured finance recruitment sector are growing, but large parts remain muted. European activity is all but moribund, while the picture in the US is mixed.

    The US securitised markets show several areas of growth, not least in CLOs. While the CMBS and RMBS sectors are mixed, the ABS market is anticipated to become even quieter going .......

    News Analysis 15 January 2014

  • Risk transfer deal differs

    Fannie Mae's US$750m CAS 2014-C01 transaction is broadly similar to the CAS 2013-C01 issue, but there are some notable differences. Weighted average voluntary prepayments are 41bp lower and cumulative defaults are 3bp higher than in the 2013-C01 transaction.

    The M1 tranche of the new transaction has initial subordination of 165bp and the M2 tranche has 30bp of original credit enhancement. .......

    News Round-up 14 January 2014

  • Further repo impact from tapering

    Tapering and financial regulation will impact the US tri-party repo market again in 2014, says Fitch. The tri-party repo market dropped US$257bn in 2013 and all eyes are now on interest rates and how banks adjust to the Basel 3 leverage ratio.

    The US tri-party repo market as a whole declined to US$1.61trn at end-2013. Agency RMBS repo fell by .......

    News Round-up 14 January 2014

  • JPA sought to implement eminent domain

    The city council of Richmond, California has adopted a resolution to seek other cities with which to form a Joint Powers Authority (JPA) that would be able to use eminent domain to acquire underwater mortgages in private label RMBS. Such a move could enable the council to sidestep existing barriers.

    While the city council has failed to achieve a super-majority .......

    News Round-up 14 January 2014

  • Foundation for continued growth?

    The US CLO and CMBS sectors saw impressive issuance in 2013, as the recovery in the asset classes continued apace. European volumes, meanwhile, reflect the growing diversity of jurisdictions on offer across the region's ABS market.

    Last year proved to be impressive for US CMBS 3.0 issuance, with conduit volumes totalling US$53.1bn, a 65% increase from US$32.2bn in 2012. US single-borrower/single-asset .......

    News 14 January 2014

  • Counterparty relationships under pressure

    The implementation of the US Treasury Market Practices Group's (TMPG) margin practices appears to have met its near-term goal of covering a significant amount of agency MBS trading volumes (SCI 16 April 2013). However, the broad-based implementation of the guidelines could have an unexpected impact on the structure of counterparty relationships across the Street, according to Deutsche Bank MBS analysts. .......

    News 13 January 2014

  • IABF auction scheduled

    Six broker-dealers have been invited to submit bids for the second IABF auction, based on the strength of their reverse inquiries (SCI 7 January). The dealers are: Bank of America Merrill Lynch, Barclays, Citi, Credit Suisse, Goldman Sachs and Morgan Stanley.

    The auction will comprise US$4.27bn current face across 360 non-agency RMBS. Bids are due on 16 January and the .......

    News Round-up 13 January 2014

  • Light shed on IABF sale

    An Interactive Data analysis of last month's US$5.1bn IABF sale suggests that the Dutch State Treasury Agency (DSTA) divested itself of the riskier holdings first. The firm notes that while pre-BWIC dialogue and information-sharing on the sale appeared to be robust, post-trade market colour was limited.

    The sale comprised primarily pay option ARM bonds (totalling around US$4.8bn), with the remainder .......

    News 10 January 2014

  • Second ESAIL restructuring on the cards

    Separate meetings for all classes of Eurosail-UK 2007-6NC noteholders have been convened on 10 February to consider an extraordinary resolution to approve the sale of the remaining Lehman claims, as well as a restructuring proposal. If successfully implemented, this will be the third restructuring of a UK Lehman RMBS to resolve 'broken swap' issues (SCI passim).

    The sale relates to .......

    News Round-up 10 January 2014

  • Dutch RMBS default drivers examined

    High loan-to-foreclosure values (LTFV) will remain the key default driver in 2014 for Dutch RMBS, according to Moody's. Secondary drivers include employment type, larger loans and affordability - each of which will have a more pronounced impact on performance than in 2013.

    "High LTFVs are likely to remain a key factor for Dutch loan default because these loans are generally .......

    News Round-up 9 January 2014

  • Underperformance for directional strategies

    Hedge funds gained an average of 1.2% in December and ended 2013 returning 9.2%, according to eVestment figures. In comparison, 2012 and 2011 returned 7.4% and -3.1% respectively.

    However, last year credit strategies posted their third lowest annual return (6.26%) since 1998, besting only 2011 (2.3%) and 2008 (-8.7%). "Performance was dragged down by directional credit strategies underperforming in the .......

    News Round-up 9 January 2014

  • FINRA urged to revisit TRACE proposal

    SIFMA has submitted a comment letter to the SEC on FINRA's proposed rule change relating to TRACE reporting and dissemination of transactions in additional ABS (SCI 5 November 2013). The association requests that FINRA not implement this proposal and instead engage in further discussion with the industry as to how best to preserve ABS market liquidity and re-propose this proposal .......

    News Round-up 9 January 2014

  • RMBS BWICs make return

    After US ABS BWIC volumes picked up on Monday, it was the turn of non-agency RMBS supply to rise yesterday. Bid-list volume approached US$550m, with activity up across fixed rate, hybrid and subprime bonds.

    Fixed rate supply came from a mix of senior prime, Alt-A and re-performing fixed bonds, while adjustable rate supply mainly came from senior Alt-A hybrids and .......

    Market Reports 8 January 2014

  • CFPB rules 'challenging' smaller servicers

    Fitch expects smaller US residential mortgage servicers to be challenged by the increased costs of new servicing requirements as they seek to opportunistically grow through strategic acquisitions. The new requirements, issued by the Consumer Financial Protection Bureau (CFPB), become effective on 10 January.

    The new servicing requirements include changes to how servicers handle borrower notifications and interaction, as well as .......

    News Round-up 8 January 2014
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