MBIA Reaches CDO Limits; Turns Attention To CFOs

  • 21 Oct 2002
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MBIA has reached self-imposed risk limits for guaranteeing synthetic collateralized debt obligations and plans to diversify its portfolio via guaranteeing securitizations referenced to alternative asset classes, such as hedge funds and private equity. Chris Weeks, managing director and head of the global CDO and structured secondary markets portfolio in New York, told DW MBIA has reached its desired level of exposure for CDOs in the current environment, largely because the deals hitting the market have the same characteristics as previous CDOs it has guaranteed. By investing in new asset classes it can diversify its exposure. "Technical innovation is the lifeblood of CDOs," said Weeks. However, MBIA will still guarantee synthetic CDOs on a highly selective basis.

The monoline's move likely will push up the price of protection on super senior tranches of synthetic CDOs, which are already high because Ambac Assurance Corp. and Financial Security Assurance recently withdrew from that market (DW, 9/29).

Weeks, who transferred to his new position from head of the firm's insurance operations in Asia last month, said his appointment was an apt occasion to initiate a standard strategic review and this review is signaling the firm should diversify its portfolio. He stressed MBIA is not pulling out of the synthetic CDO arena because of a deterioration in the credit quality of its portfolio.

The insurance giant has spoken to structuring houses and will take exposure to CFO deals based on the ability of the manager. But Weeks declined to name any specific deals or firms the monoline is reviewing.

Ambac stated that it had stopped guaranteeing synthetic CDOs referenced to corporates because of problems with restructuring language and FSA has pulled out because of losses. Weeks said although it wants the restructuring definition to be removed that is not a reason for its decision.

  • 21 Oct 2002

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Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • 13 Mar 2017
1 JPMorgan 94,925.33 384 8.39%
2 Citi 87,531.58 331 7.74%
3 Bank of America Merrill Lynch 84,341.49 288 7.46%
4 Barclays 75,288.19 241 6.66%
5 Goldman Sachs 68,504.71 208 6.06%

Bookrunners of All Syndicated Loans EMEA

Rank Lead Manager Amount $m No of issues Share %
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  • 16 May 2017
1 Deutsche Bank 19,381.65 47 8.82%
2 Bank of America Merrill Lynch 18,968.25 36 8.63%
3 HSBC 18,103.95 50 8.24%
4 BNP Paribas 8,911.57 55 4.05%
5 SG Corporate & Investment Banking 8,885.00 54 4.04%

Bookrunners of all EMEA ECM Issuance

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • 16 May 2017
1 JPMorgan 8,369.56 33 8.53%
2 UBS 8,282.28 33 8.44%
3 Citi 6,605.58 44 6.74%
4 Goldman Sachs 6,444.85 31 6.57%
5 Bank of America Merrill Lynch 6,215.31 24 6.34%