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Securitization - Article Archive
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AA Gets £1.3bn WBS Away Amid Headwinds
The U.K.’s largest car breakdown assistance company, the Automobile Association, overcame turbulent market conditions this week to price the first investment grade and high yield bonds from a new whole business securitization platform.
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Deal Flow Tipped To Weaken In Third Quarter
Second quarter issuance—typically a busy period for the U.S. securitization market—ended with a whimper, and market professionals aren’t seeing grounds for a rebound in the second half.
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Knight MBS Trader Hits The Dusty Trail
Ruslan Margolin, head of non-agency mortgage-backed securities trading at Knight Capital Group, left the firm, destination: the whole world.
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Securitization Can Add To Household Debt Imbalances
Securitization of mortgages guaranteed by the Canadian government can cause a buildup of imbalances in the household sector, according to Tim Lane, a deputy governor at the Bank of Canada.
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SEC To Press For Guilty Plea In MBS Cases
The U.S. Securities and Exchange Commission will now likely begin pressing for guilty pleas in civil cases, including those involving mortgage-backed securities, and shift away from the settlements without admitting or denying guilt, according to legal experts.
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Mortgage REITs Under Pressure May Drive MBS Volatility
U.S. agency mortgage real estate investment trusts that rely heavily on repo funding may come under pressure to liquidate, and consequently drive up volatility in mortgage-backed securities, if repo lenders tighten their terms as a result of higher interest rates, according to Fitch Ratings.
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Fed To Vote On Basel
The Federal Reserve Board of governors plans to vote July 2 on the final rules for banks based on measures adopted by the Basel Committee on Banking Supervision.
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B Of A Nixes AIG Bid On MBS Settlement
Bank of America has rejected a bid by American International Group to renegotiate a $8.5 billion settlement with investors in mortgage-backed securities, as the insurer feels the agreed-upon amount was only a fraction of what they lost.
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U.K. Seeks Advisers For RBS, Lloyds Sale
The U.K. government has launched a tender for investment banks to advise on a future sale of its stake in the Royal Bank of Scotland and Lloyds Banking Group as it moves to return the banks to the private sector.
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Denmark To Stick To Tough Bail-In Plan
Danish Economy Minister Margrethe Vestager says Denmark will stick with its bail-in plan that is tougher than one included in a plan proposed by the European Union.
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Barclays May Cut Lending To Meet PRA Goal
Barclays says it may need to reduce lending in order to meet a 3% leverage ratio imposed by the U.K.’s Prudential Regulation Authority if it is forced to do so before the current 2015 timetable.
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ECB Denies Mulling Fed-Style MBS Program
The European Central Bank has denied a German newspaper’s report that it was discussing introducing a program to purchase mortgage-backed securities similar to one in which the U.S. Federal Reserve is currently engaged. Click here to read the story from Reuters.
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“I expect this to continue until we get more clarity over the economy and the Fed. While there is still uncertainty, people will pull back if spreads are wider and yields are higher, it might not make as much economic sense to issue or originate.”
—Scott Buchta, head of fixed-income strategy at Brean Capital, on his expectation that issuance of asset- and mortgage-backed securities could slump in the second-half of 2013.
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One Year Ago
Issuers of collateralized loan obligations in the U.S. were shoving their deals out the door during a “window of necessity” ahead of potential capital markets volatility and the traditional summer lull.
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BT and BA keep US bonds alive as banks fear for H2 volumes
Two UK borrowers braved the volatility in the US credit markets this week, while domestic issuers remained on the sidelines, as a senior US Federal Reserve official moved to reassure markets.
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Brussels Airport has €500m debut as market stabilises
Brussels Airport took advantage of a more stable day in European credit markets on Tuesday to launch its debut bond. Although the deal probably cost it more than it would have before the latest bout of volatility, the bond was well placed.
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Deutsche Annington to sell unsecured bond after IPO
Deutsche Annington, Germany’s largest residential property company, is roadshowing for its first unsecured corporate bond. The deal will be part of a wider refinancing of the company by its owner, Terra Firma, the UK private equity fund.
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AA gets £1.3bn WBS away amid headwinds
The UK’s largest car breakdown assistance company, the Automobile Association, overcame turbulent market conditions this week to price the first investment grade and high yield bonds from a new whole business securitization platform.
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CRE Loan Prices Fall In May
Loan prices in U.S. commercial mortgage-backed securities fell in May to 91.4% from 92% a month earlier but up from 88.2% a year earlier, according to DebtX.
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Cantor Expands Credit Fixed Income
Cantor Fitzgerald has expanded its credit fixed income team with the hiring of Keith Melchionni, David Patterson, John Kleinert and Jordan Cahn, who will focus on high-yield, investment-grade and distressed-debt sales and trading in New York.
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U.S. Auto ABS Prime Delinquencies At 10-Year Low
Net loss levels for U.S. prime automobile asset-backed securities fell for the fourth consecutive month in May, with prime delinquencies that are more than 60 days late or longer dropping to 0.29%, its lowest level in 10 years, according to Fitch Ratings.
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Mexican RMBS Worsen
Performance of Mexican residential mortgage-backed securities, excluding Sociedades Financieras de Objeto Limitado transactions, worsened as of April 30, with Moody’s Investors Service’s Mexican RMBS index rising to 4.4% from 3.2% a year ago.
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Bank Plans Fail To Reduce Systemic Risk
None of the U.S. banks deemed systemically important have submitted plans that sufficiently reduce any potential risk to the financial system in the event they fail, according to Jim Wigand, the Federal Deposit Insurance Corp.’s director of the new Office of Complex Financial Institutions.
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Loan Performance Continues To Improve
The performance of first-lien mortgages rose in the first quarter to 90.2%, continuing its upward trend over the past year, thanks to improving economic conditions, servicing transfers, home retention efforts and home forfeiture actions, according to the a report by the Office of the Comptroller of the Currency.
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Banks Offering Higher Rates Amid Suring Rates, Volatility
Banks have been offering rates on structured notes and market-linked certificates of deposit that are higher than advertised amid surging Treasury yields and a volatile stock market.
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EC and EIB reveal three ways ABS could aid SMEs
The European Commission and European Investment Bank have outlined the three ways they are considering using the securitization market to increase lending to European small- and medium-sized enterprises.
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Leeds preps Albion RMBS against difficult backdrop
Leeds Building Society is gearing up for its debut public issue from its Albion prime residential mortgage securitization shelf, in what will be only the fourth piece of UK RMBS issued this year.
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Opera CMH workout in disarray as buyout is rejected
Class ‘C’ and ‘D’ noteholders have rejected a proposal to change the payment waterfall of the troubled Opera Finance (CMH) CMBS, scuppering Kennedy Wilson’s buy-out of the Irish portfolio backing the deal. Rather than leading to a quick enforcement, however, the failed vote opens the door to Northwood Investors’ last ditch restructuring proposal.
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Volkswagen Driver 11 prices at tight end of guidance
Volkswagen Bank has priced its second Driver German auto loan securitisation of the year at the tight end of guidance for the senior class ‘A’ notes, after starting guidance wide of initial price thoughts.
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Ulster Bank exceeds Celtic RMBS buyback target
Royal Bank of Scotland’s Irish subsidiary, Ulster Bank, has bought back €1.5bn of Celtic Residential Irish Mortgage Securitization (CRSM) bonds, exceeding its targeted volume by around €250m.
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Credit Suisse places legacy UK non-conforming RMBS
Credit Suisse has successfully placed Alba 2013-1, a securitization of non-conforming UK mortgages that were mostly originated at the height of the UK property boom in 2006 and 2007, with the same handful of investors that bought Alba deals in 2012 and 2011.
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ABS working group unveils simplified approach to capital
A securitization industry working group has unveiled a second method for calculating capital requirements for securitization positions as it seeks to persuade the Basel Committee to change the capital framework it proposed at the end of last year.
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High yield not shut, say bankers, as bridged deals wait for stability
The European high yield market is not shut, bankers were confident this week, as the last few days brought some market stabilisation. Two banks plan to start premarketing bonds as early as Monday, after the Markit iTraxx Crossover tightened 56bp since the start of the week.
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Intralot could relaunch high yield bond soon as refinancing CB is getting urgent
Intralot, the Greek gaming machines and systems provider, has postponed plans for a €300m unsecured high yield bond, but could try to access the market again soon, as it still wants to buy back its convertible bond.
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Coming attraction: Vue prepares HY bond for LBO
Vue Entertainment, the UK cinema chain, could start premarketing its high yield bond to finance its takeover by Omers Private Equity and Alberta Investment Management Corp as early as next week.
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Opera Workout Takes Another Twist As Kennedy Wilson Offer Is Rejected
Class C and D noteholders have rejected a proposal to change the payment waterfall of the troubled Opera Finance (CMH) commercial mortgage-backed securities deal, scuppering Kennedy Wilson’s buy-out of the Irish portfolio backing the deal. Rather than leading to a quick enforcement, however, the failed vote opens the door to Northwood Investors’s last ditch restructuring proposal.
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Credit Suisse Places Alba Legacy U.K. Non-Conforming RMBS
Credit Suisse has successfully placed Alba 2013-1, a securitization of non-conforming U.K. mortgages that were mostly originated at the height of the U.K. property boom in 2006 and 2007, with the same handful of investors that bought Alba deals in 2012 and 2011.
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Pricing for VW’s Driver 11 Tightened
Volkswagen Bank set pricing for its second Driver German auto loan securitization at the tight end of guidance for the senior class A notes, after starting guidance wide of initial price thoughts.
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Ireland Revises Mortgage Arrears Code
The Central Bank of Ireland has revised its requirements for mortgage lenders that deal with borrowers facing or in mortgage arrears.
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E.U. Adopt Failed-Bank Rules
European Union finance ministers have agreed on rules that would require creditors to absorb losses in failed banks.
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U.K. Banks Allowed To Lower Liquidity Stocks
The U.K.’s Financial Policy Committee has told banks they may reduce their liquidity stocks to 80% of their requirements between now and 2015 in an effort to boost lending, freeing up an aggregated £70 billion ($106.63 billion).
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Portuguese RMBS Remain Weak In Q1
Performance of Portuguese residential mortgage-backed securities remained weak in the first quarter, according to Moody’s Investors Service.
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Investor Losses From Deposit Set-Offs In E.U. Unlikely
Fitch Ratings says the likelihood of structured finance or covered bond investors incurring losses as a result of the set-off of insured domestic deposits by obligors is highly remote in most European Union countries.
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No Need Seen To Revive CMBS In France
Lending in France has remained stable as non-banks have picked up where banks have withdrawn from the activity, according to market professionals, who suggested there was no need to revive the market for commercial mortgage-backed securities for this purpose.
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All Revenue league tables
Dealogic league tables of total revenue transactions, June 27, 2013. Including Investment Banking, Debt Capital Markets, Equity Capital Markets, Mergers & Acquisitions and Syndicated Loan revenues.
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All Bonds league tables
Dealogic league tables of bond transactions, June 26, 2013. Includes SSAs, FIG, investment grade and high-yield corporates, emerging markets and ABS.
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Credit Suisse places Alba legacy UK non-conforming RMBS
Credit Suisse has successfully placed Alba 2013-1, a securitization of non-conforming UK mortgages that were mostly originated at the height of the UK property boom in 2006 and 2007, with the same handful of investors that bought Alba deals in 2012 and 2011.
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Pricing for VW’s Driver 11 tightened
Volkswagen Bank is set to price its second Driver German auto loan securitisation at the tight end of guidance for the senior class ‘A’ notes, after starting guidance wide of initial price thoughts.
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All Asian league tables by sector
Dealogic league tables of Asian transactions, dated June 26, 2013. Including Bonds, ECM, Syndicated Loans, Mergers & Acquisitions.
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International bonds league tables
Dealogic league tables of bond transactions, June 26, 2013. Includes SSAs, FIG, investment grade and high-yield corporates, emerging markets and ABS.
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Troubled Opera CMH CMBS takes another twist as Kennedy Wilson offer is rejected
Class ‘C’ and ‘D’ noteholders have rejected a proposal to change the payment waterfall of the troubled Opera Finance (CMH) CMBS, scuppering Kennedy Wilson’s buy-out of the Irish portfolio backing the deal. Rather than leading to a quick enforcement, however, the failed vote opens the door to Northwood Investors’ last ditch restructuring proposal.
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All Syndicated Loans league tables
Dealogic league tables of loans transactions, June 27, 2013.
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Premarketing for Vue high yield bonds as early as next week
Vue Entertainment, the UK cinema chain, could start premarketing for its high yield bond to finance its takeover by Omers Private Equity and Alberta Investment Management Corporation as early as next week.
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CSAM Gets Euro Deal Back On Track
Credit Suisse Asset Management is back with its European collateralized loan obligation, Cadogan Square CLO V.
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Southwest Securities Named ABS/MBS V.P.
Dallas-based Southwest Securities has hired George Smith as v.p. in charge of mortgage-backed securities, asset-backed securities and commercial mortgage-backed securities trading.
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Lawmakers Introduce GSE Reform Bill
Sen. Bob Corker (R-Tenn.) and Mark Warner (D-Va.) introduced legislation that would wind down Fannie Mae and Freddie Mac within five years, and includes other measures, such as first-lien holders being able to block the borrower from taking out a second lien.
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Auto ABS See Biggest Drop In 32 Months
U.S. asset-backed securities linked to automobile loans are expected to experience in June their biggest decline since November 2010, falling 0.15%, over concerns that the Federal Reserve may slow its stimulus activities.
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CMBS Delinquencies Improve In June
A pick up in the pace of liquidations and modifications have helped improve the delinquency rate of commercial mortgage-backed securities in June, according to Barclays analysts.
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Rate Volatility Shutting Jumbo Securitization Market
Recent interest rate volatility has effectively closed the market for jumbo securitizations, according an FBR Capital Market research note.
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UCal Sues Banks Over LIBOR
The University of California has filed a lawsuit against more than a dozen banks, alleging they manipulated the London Interbank Offered Rate.
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Freddie Mac Mortgage Portfolio Falls
The unpaid principle balance of Freddie Mac’s mortgage portfolio fell in May for the first time since February, declining at an annualized rate of 1.5% since Jan. 1.
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Goldman CLO Reshuffle Continues
Omar Chaudhary has relocated from Goldman Sachs’ London office to head up the firm’s U.S. collateralized loan obligations new issue business in New York.
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EURIBOR May Be Gone In A Year
The Euro Interbank Offered Rate may be phased out within a year and replaced with a different benchmark that may be based partly on bank estimates on the price of borrowing as well as actual market rates, as banks have distanced themselves from EURIBOR over alleged manipulation.
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Unsuitable Structured-Product Investors Identified
Clarendon, the financial services agency, has issued a report that identifies the type of investors unsuitable for structured products, including nervous investors who are less likely to deal with losses, and overconfident ones.
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Basel Agrees On Leverage-Ratio Formula
The Basel Committee on Banking Supervision has agreed on a formula for banks to calculate and disclose their leverage ratios.
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British Airways Launches £603 Mln Asset-Backed Bond
British Airways has launched a £603 million ($924.37 million) asset-backed bond using 14 Boeing and Airbus planes due for delivery over the next year as collateral, the first U.K. airline to do so.
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FTT Delayed Six Months
The 11 European countries that have indicated they would introduce a financial transaction tax by Jan. 1 have agreed to delay its effective date by six months as their governments remain sharply divided on key aspects of the measure.
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B Of E Orders Review Of Interest-Rate Risk To Banks
The Bank of England has ordered a review of banks for their exposure to interest-rate risk, concerned that a sudden rise in rates could have a negative impact on them.
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EC, EIB Reveal Trio Of Ways Securitization Could Help SMEs
The European Commission and European Investment Bank have outlined the three ways they are considering using the securitization market to increase lending to European small and medium-sized enterprises.
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Ulster Bank Exceeds Celtic RMBS Buyback Target
Royal Bank of Scotland’s Irish subsidiary, Ulster Bank, has bought back EUR1.5 billion ($1.95 billion) of Celtic Residential Irish Mortgage Securitization (CRSM) bonds, exceeding its targeted volume by around €250 million ($325.08 million).
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VW Forced Wide Of Initial Talk For Driver As Market Sell-Off Bites
Formal guidance for Volkswagen Bank’s Driver 11 German auto loan securitization has been set wider than initial price thoughts in the class A and B tranches to take account of continued weakness in the secondary market.
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High yield not closed, say bankers, as Crossover recovers
The worst of the high yield market sell-off might be over in Europe, suggested market participants at the Euromoney Global Borrowers' and Investors' Forum in London today. This comes on a day when the Markit iTraxx Crossover tightened for the second day in a row — in what could indicate a market stabilisation.
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EC and EIB reveal trio of ways securitization could help SMEs
The European Commission and European Investment Bank have outlined the three ways they are considering using the securitization market to increase lending to European small and medium-sized enterprises.
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VW forced wide of IPTs for Driver as market sell-off bites
Formal guidance for Volkswagen Bank’s Driver 11 German auto loan securitization has been set wider than initial price thoughts in the class ‘A’ and ‘B’ tranches to take account of continued weakness in the secondary market.
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Window market returns but corporates can handle it
The lurching volatility in rates, equities and credit spreads as markets get used to the idea that US quantitative easing will have to be withdrawn are making life difficult for corporate bond issuers of all stripes.
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Ulster Bank exceeds Celtic RMBS buyback target
Royal Bank of Scotland’s Irish subsidiary, Ulster Bank, has bought back €1.5bn of Celtic Residential Irish Mortgage Securitization (CRSM) bonds, exceeding its targeted volume by around €250m.
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Louisiana Hits Screens With Tobacco Settlement ABS
The State of Louisiana is in the market with a $638.03 million securitization of tobacco settlement revenues.
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Invesco Out With North End CLO
Invesco Senior Secured Management is in the market with a $414.75 million collateralized loan obligation known as North End.
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Freddie Mac Said To Prep Default-Risk Notes
Freddie Mac is said to be preparing to sell notes linked to default risks of home-mortgage pools.
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Loan Delinquency Continues To Improve
Loan delinquencies continue to improve, falling 2.11% in May from the preceding month and down 12.01% from a year earlier, according to Lender Processing Services.
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Outlook For Non-Agency RMBS Stable
Standard & Poor’s says the outlook for private-label residential mortgage-backed securities is stable, rather than positive, because of some challenges in the sector, such as “limited principal and interest advancing by servicers, foreclosure and liquidation timelines, and the impact of loan modifications.”
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Fitch Updates Rep & Warranty RMSB Criteria
Fitch Ratings has updated the criteria it uses for analyzing representations and warranties as well as enforcement mechanisms in new issue U.S residential mortgage-backed securities.
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DOJ Eyes 2015 RMBS Trial For S&P
The U.S. Department of Justice is looking at a February 2015 trial date for its case against Standard & Poor’s over its ratings of residential mortgage-backed securities.
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CFPB Proposes Mortgage Rule Revisions
The U.S. Consumer Financial Protection Bureau has proposed clarifications and some “narrow revisions” to the mortgage rules it released in January.
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Securitization Working Group Unveils Simplified Arbitrage-Free Approach To Capital
A securitization industry working group has unveiled a second method for calculating capital requirements for securitization positions as it seeks to persuade the Basel Committee on Banking Supervision to change the capital framework it proposed at the end of last year.
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AA Gets Secured Senior And HY Bonds Away In Difficult Market
Pricing for the Automobile Association’s debut issue of bonds backed by its entire business started at generous spreads for both the senior and high yield portions, but sterling investors demanded even more to get involved in the senior 12-year tranche.
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Securitisation working group unveils Simplified Arbitrage Free Approach to capital
A securitisation industry working group has unveiled a second method for calculating capital requirements for securitisation positions as it seeks to persuade the Basel Committee to change the capital framework it proposed at the end of last year.
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Austrian Bank To Raise EUR660 Mln To Repay Funds
Austria’s Erste Group says it is planning a rights issue in the third quarter to raise EUR660 million ($863.4 million), which the bank will use to repay capital it received during the financial crisis.
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Regulators Expected To Raise Banks’ Risk Weight
Fitch Ratings predicts that other European regulators will follow the lead of Denmark, where Danske Bank has been ordered to increase its through-the-cycle probability of default assumptions in its internal risk models for corporate and institutional portfolios.
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B Of E To Form LIBOR Committee
Mark Carney, the incoming governor of the Bank of England, has confirmed plans to create a steering committee that will oversee reform of the London Interbank Offered Rate.
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ECB Could Help Boost SME Securitization Market
The European Central Bank could help develop the securitization market for small and medium-sized enterprises, according to Benoit Coeure, an executive board member of the ECB.
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U.K. Mortgage Approvals Up 10.8% In May
Mortgage approvals rose 10.8% in the U.K. in May from a year ago, according to the British Bankers’ Association.
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Spanish Covered Bond Framework Praised
Moody’s Investors Service has praised Spain’s covered bond legal framework, saying it has “several strengths” and provides “good protection against certain legal risks.”
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AA gets secured senior and HY bonds away in difficult market
Pricing for the Automobile Association’s debut issue of bonds backed by its entire business started at generous spreads for both the senior and high yield portions, but sterling investors demanded even more to get involved in the senior 12 year tranche.
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Your Complimentary PDFs Of Total Securitization
Click to access the free download of the two most recent issues of Total Securitization.
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Your Complimentary PDFs Of Total Securitization
Below, please find links to the two most recent issues of Total Securitization, including our exclusive Q & A with Richard Hopkin, managing director in the securitization group at the Association for Financial Markets in Europe, coverage of Global ABS in Brussels, comprehensive lists of new ABS pricings in the U.S. and Europe, and more.
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Intralot postpones high yield bond debut
Intralot, the Greek provider of gaming and transaction processing systems, has postponed its high yield bond debut. The Athens-listed company wanted to raise €300m in unsecured notes but on Friday decided to delay the issue, due to further deterioration in the market.
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Ares Follows Carlyle’s Step-Up Strategy For New CLO
Ares Management joined the new issue collateralized loan obligation pipeline Monday with a new $411.50 million trade, Ares XXVII, which is being brought to market by Goldman Sachs.
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Market Jitters Bring Structured Finance To Standstill
Credit market jitters brought structured finance to a near standstill Monday as there were no new deals in the primary asset-backed securities market with little activity in the secondary market.
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Branding Firm Completes $275 Mln Securitization
Iconix Brand Group has announced that its subsidiaries have completed $275 million issuance of senior secured notes in a private transaction under an existing securitization program.
