Securitization - Article Archive

  • MBS market cheers delay of GSE refinance fee

    The Federal Housing Finance Agency (FHFA) has delayed the implementation date of the adverse market refinance fee to December 1, following a wave of criticism from mortgage market participants. With more time to prepare before implementation, sources say the fee is a logical move on the part of the agencies to allow all players in the market to benefit from low mortgage rates, as well as shore up capital to cover losses stemming from the pandemic.

    • 31 Aug 2020
  • Venn Partners mandates BNPP-led bank team for public RMBS

    ARA Venn has mandated a consortium of banks led by arranger BNP Paribas for Cartesian Residential Mortgages 5, an upcoming prime Dutch RMBS set to be offered publicly, in a sign that primary issuance is returning.

    • 28 Aug 2020
  • Big groups join in new drive to clear ESG roadblocks

    Two of the biggest sustainable finance organisations, the PRI representing investors and WBCSD for companies, are putting their heads together to try to solve two of the thorniest issues impeding progress in the field.

    • 28 Aug 2020
  • ECB tells Monte dei Paschi to issue T2 by end of the year

    The European Central Bank has requested that Banca Monte dei Paschi di Siena raise at least €250m of tier two capital before the end of this year, as part of the conditions of its sale of non-performing loans to Amco. Analysts say the bank might have to pay as much as a 9% coupon on the bond.

    • 28 Aug 2020
  • In historic pivot, Fed shifts away from hard inflation target

    The Federal Reserve announced on Thursday that it will allow inflation to run higher than the long running 2% target, a long awaited and historic shift in monetary policy that marks the start of a new era that will enable the Fed to keep rates low for longer.

    • 27 Aug 2020
  • People moves in brief

    Pons goes to Axa — ECM's Balt heads to alt plastic firm — Esteve joins Barclays

    • 27 Aug 2020
  • CLO trader leaves BNPP for Axa IM

    CLO trader Olivier Pons has left BNP Paribas’ secondary trading desk after 15 years with the bank, moving to an investment manager.

    • 27 Aug 2020
  • Santander first to market after August ABS break

    Santander Consumer Spain Auto 2020-1 is the first ABS deal to come to market after the break in primary issuance throughout August, with a full capital stack being offered to investors.

    • 27 Aug 2020
  • Issuers, investors clash over fees in whole business ABS

    The coronavirus pandemic has led to tensions between whole business ABS issuers and investors, amid wrangling over management fees. While investors worry that waiving fees that issuers pay to the corporate parent may mask true risk in the deals, issuers argue it is critical to preserve liquidity at a time of unprecedented corporate distress.

    • 26 Aug 2020
  • Bonds regain the advantage over loans in European levfin

    In the eternal contest between the high yield bond and leveraged loan markets, high yield has won the upper hand during the Covid-19 pandemic, and market participants expect that advantage to remain in the coming months.

    • 26 Aug 2020
  • Intu administration puts £2.5bn of CMBS at risk

    UK shopping centre owner Intu Properties has fallen into administration, throwing into question the fate of £2.5bn of CMBS notes secured by its real estate.

    • 26 Aug 2020
  • Static deals, European opportunities and the future of CLOs - Q&A with Palmer Square CEO Chris Long

    Kansas-based Palmer Square Capital Management has been one of the most active managers of the year, particularly in the pandemic era, with six CLOs priced in 2020. The firm, which manages $12.3bn in assets as of July 31, has specialized in static CLO issuance, and during the crisis was able to price three static deals in the US, as well as one in Europe. Chairman and CEO Chris Long spoke with GlobalCapital about the future of CLO market, the advantages of static deals in times of crisis and opportunities in Europe.

    • 25 Aug 2020
  • UK payment holidays eat into excess spread in RMBS

    The average level of excess spread in UK RMBS deals has dropped along with interest collections as government enforced payment holidays take their toll on the sector.

    • 25 Aug 2020
  • Container ABS issuance jumps to make August busiest month since pandemic

    Issuers have pushed four container ABS deals through the primary pipeline in August, marking the busiest month for the sector since the pandemic began.

    • 25 Aug 2020
  • Chase returns with first auto securitization since 2006

    JP Morgan Chase is preparing a $1.8bn credit-linked note ABS that includes $200m of investment grade notes, aimed at transferring risk on a pool of auto loans to securitization investors.

    • 24 Aug 2020
  • UK securitization issuance to spike after holidays

    Rating agencies are reporting a busy pipeline of European securitization issues for the autumn, with a number of UK deals expected in particular, as issuers try to squeeze out deals before the end of government support schemes and the looming Brexit deadline.

    • 24 Aug 2020
  • Amigo tumbles again as board fights founder

    James Benamor called a second shareholder vote in four months on Thursday to replace the board of Amigo Holdings, the troubled UK guarantor loan company he founded in 2005, after the board rejected his proposals — including reappointing him as CEO.

    • 24 Aug 2020
  • Deutsche grows Blackstone CLO

    Deutsche Bank increased the size of a Blackstone/GSO European CLO from €294.81m to €343.922m. The bank also added preliminary ratings from Kroll Bond Rating Agency to the deal hours before pricing.

    • 21 Aug 2020
  • Geely returns to auto ABS market for bigger deal

    Genius Auto Finance sealed a Rmb4.5bn ($651m) three tranche auto loan securitization trade on Thursday, setting the stage for a steady revival of the Chinese auto ABS market.

    • 21 Aug 2020
  • CLO players eyeing another wave of downgrades in autumn

    As the CLO market enters the end of the summer, managers are getting ready to restart activity after Labor Day. But they are concerned about a potential wave of negative actions from rating agencies.

    • 20 Aug 2020
  • Palmer Square launches debut static CLO in Europe

    Palmer Square Capital Management has announced its debut CLO in Europe, mandating JP Morgan for a rare static CLO, a deal structure not commonly seen in Europe.

    • 20 Aug 2020
  • New CLOs seeded as managers split old warehouses in two

    US CLO managers are working through a backlog of warehouses opened before the Covid-19 pandemic by splitting the facilities in half to buy back some equity and issue new deals. While in Europe, managers are tweaking deal documentation in preparation for new transactions.

    • 20 Aug 2020
  • Colorado 'true lender' settlement brings legal clarity for fintechs

    The Colorado attorney general reached a settlement with marketplace lenders Avant and Marlette Funding on Tuesday that enables the lenders to keep working with partner banks under safe harbour provisions if they comply with rules set out by the state. Market participants said the settlement is a clear win for online lenders, as it brings legal certainty, and it may guide other states in resolving “true lender” issues.

    • 19 Aug 2020
  • European CLO BWIC volumes surpass 2019 levels

    European CLO secondary trading activity has surpassed 2019’s full-year volumes, following a spurt of CLO tranche trading when spreads widened out in March.

    • 19 Aug 2020
  • Paul, Weiss hires securitization partner from White & Case

    Paul, Weiss, Rifkind, Wharton & Garrison has hired Charles Pesant as partner in the securitization practice group and in the corporate department in New York.

    • 19 Aug 2020
  • Why Avis won't go bankrupt like Hertz

    It’s amazing how quickly the conversation around Avis has changed over the last few months. In April, investors worried that Avis would follow Hertz, its car rental rival, into bankruptcy by the end of 2020. But Avis’s performance in the second quarter and its recent success in the ABS market suggest it is in a much better position than its competitors to weather the recession.

    • 18 Aug 2020
  • Get ready for a mortgage holiday fight

    UK politicians should prepare for mortgage holidays becoming a political hot potato after borrowers who took payment holidays just-in-case realise that their financial well-being may not be as unscathed as they first anticipated.

    • 18 Aug 2020
  • Wyndham completes largest timeshare ABS since 2007

    International hotel chain Wyndham Destinations completed a $575m timeshare securitization on Monday, boosted by strong investor demand and a low benchmark rate. The deal was increased by $175m, making it the largest term ABS from Wyndham since 2007.

    • 18 Aug 2020
  • Amigo founder vows return to company

    Amigo’s estranged founder wants to return to Britain’s biggest guarantor loans provider, floating the possibility of another shareholder vote, after selling more than 40% of the company, reducing his stake to below 20%.

    • 18 Aug 2020
  • How to protect a remote lobster processor

    One of the remotest parts of the world is home to a new piece of financial engineering. Tristan da Cunha, a volcanic island in the South Atlantic Ocean, is making use of a wind derivative instrument structured by Global Parametrics, an organisation seeking to improve the developing world’s resilience against extreme weather.

    • 17 Aug 2020
  • GSO prices static CLO at tightest Covid-era spread

    Triple-A spreads on new CLO issues hit 130bp last week — their tightest level since the beginning of the pandemic — as GSO priced a $300.15m static CLO arranged by Barclays.

    • 17 Aug 2020
  • Brazilian credit card law will boost non-bank ABS

    A new Brazilian law is set to boost credit card ABS securitizations from non-bank lenders, helping the alternative sector to thrive despite the economic fallout from coronavirus.

    • 17 Aug 2020
  • RBC reduces securitization facility with Amigo

    Royal Bank of Canada agreed to a further extension for a performance trigger waiver on its securitization facility with Amigo Holdings and slimmed the facility down from £300m to £250m. Separately, founder James Benamor vowed to return to the company.

    • 17 Aug 2020
  • Exclusive: Greensill poaches distribution leadership from Citi, Morgan Stanley

    Supply chain finance company Greensill has hired Peter Charles as vice-chairman of distribution and Dolph Habeck as managing director, head of distribution of the Americas, the company told GlobalCapital.

    • 17 Aug 2020
  • European CLO market adapts to the challenges of the COVID-19 era (full transcript)

    The period since March has been a turbulent time for financial markets, and the CLO sector in Europe dealt with a complex set of disruptions when the pandemic arrived this spring. From sudden and acute stress at the corporate level, to an unprecedented shift in working conditions, CLO players in Europe experienced uncertainty not seen since the last crisis. Yet, the market has adapted, and while the shape and size of deals may be different, CLOs in Europe are pushing ahead. BNY Mellon and GlobalCapital gathered market experts to discuss the present state of the European CLO market and its prospects.

    • 17 Aug 2020
  • NatWest designs new investment bank layout

    NatWest Markets has restructured its divisions and given them new leadership. It is also moving some UK corporate-focused bankers over to the ring-fenced bank.

    • 14 Aug 2020
  • Toorak adds Tatro as head of asset management

    Real estate investment firm Toorak Capital Partners has hired Kevin Tatro as head of asset management and reporting and Stephen Tyde, Jr, as head of special servicing.

    • 13 Aug 2020
  • People moves in brief

    Deutsche Bank picks pair for healthcare — Rothesay makes moves in US — Barclays announces new ESG positions

    • 13 Aug 2020
  • UK ABS market mulls prospect of negative Sonia

    Investors and research houses are forecasting for Sonia to follow Gilts into negative yields next year, which could force issuers to cover themselves against a hedging mismatch in auto ABS deals.

    • 13 Aug 2020
  • Real mortgage holiday picture in UK better than data suggests, say investors

    UK mortgage moratorium numbers are being inflated by the timing of the government’s job retention scheme, with data from lenders suggesting payment holiday levels were more in line with continental Europe than they at first appeared, according to investors.

    • 13 Aug 2020
  • Economist Brad Setser on swap lines: Fed acted with speed and force

    Many saw the US Federal Reserve’s decision to lend hundreds of billions of dollars to certain central banks at the height of the coronavirus crisis as pivotal in preventing further calamity in global markets. Brad Setser, senior fellow for international economics at the Council of Foreign Relations, gives a great deal of credit to the Fed for its forceful intervention. But if markets begin to see the US central bank as a global lender of last resort, there may be a greater risk of imprudent behaviour and more political tumult in the US.

    • 13 Aug 2020
  • Rip up docs to beat market pain, urge US CLO managers

    As the economic effects of the coronavirus pandemic ripple through capital markets and defaults pile up, CLO managers are scrambling to alter deal structures to cope with heightened risk and to take advantage of new opportunities. Paola Aurisicchio reports.

    • 13 Aug 2020
  • Container ABS shines as bright spot in transportation sector

    Textainer enjoyed high demand and tighter than expected spreads when it priced the first container securitization of the year. Container ABS stands out among other transportation asset classes, according to investors, due to its strong utilization rate and the security that comes from the multi-year leasing agreements between lessors and shipping lines.

    • 12 Aug 2020
  • Citi pre-places UK RMBS with pre-2008 assets

    Citibank fully pre-placed Cheshire 2020-1 on Tuesday, a £247m RMBS transaction backed by seasoned owner-occupied and buy-to-let mortgages. The loans were originated by Citi's lending arm Future Mortgages, which stopped lending in 2008.

    • 12 Aug 2020
  • Voya prices $396m 'print and sprint' CLO

    Voya Alternative Asset Management priced a $396m so-called 'print and sprint' CLO last week, joining a handful of managers that have opted for speedier deal execution in the Covid era.

    • 11 Aug 2020
  • Rothesay adds CIO, RMBS expert to bolster US business

    Rothesay Asset Management North America promoted Robert Allard to a newly created role of chief investment officer and added Daniel Parisi as mortgage analyst in a move to ramp up its US structured finance team.

    • 11 Aug 2020
  • Fitch revises FFELP ABS outlook to negative

    Fitch Ratings downgraded the rating outlook on Federal Family Education Loan Program (FFELP) student loan ABS sector from stable to negative, reflecting the ongoing deterioration of the US public finance and the absence of a credible fiscal consolidation plan, the rating agency said.

    • 11 Aug 2020
  • US hedge fund mandates BofA for UK legacy RMBS

    Davidson Kempner Capital Management has mandated Bank of America for Stratton Mortgage Funding 2020-1, a UK RMBS deal made up of mortgages originated between 2002 and 2008. It was priced on Thursday and its 2.95-year senior notes landed at 90bp over Sonia.

    • 11 Aug 2020
  • Piraeus seeks Hercules guarantee for €6.9bn of NPLs

    Piraeus Bank on Monday filed for a €1.9bn NPL securitization transaction under the Hercules Asset Protection Scheme (HAPS), making it the third Greek bank to apply since the scheme began. It is also looking to add another €5bn securitization later in 2020.

    • 11 Aug 2020
  • WhiteHorse bolsters originations team with new principal

    WhiteHorse Capital, the credit arm of H.I.G. Capital, has hired Jason Hicks as principal. Hicks will be based in WhiteHorse’s New York office and will be responsible for originating and executing middle market debt financings for private equity sponsored transactions.

    • 10 Aug 2020
  • UK inflation reform to boost student loan ABS repayment

    UK student loan securitizations are set to repay faster if the government decides to reform inflation indices in 2030, benefiting junior investors. Other noteholders could see returns drop if the government opts for an earlier switch date, however.

    • 10 Aug 2020
  • Alternative Access Funds eyes retail investors with triple-A CLO ETF

    Alternative Access Funds has launched an exchange-traded fund (ETF) focused on triple-A CLOs to appeal to investors who have not bought the asset class before.

    • 10 Aug 2020
  • Former Morgan Stanley MD to lead Figure’s capital markets team

    Figure Technologies has hired on Robert Hershy to be head of capital markets for its blockchain platform, Provenance. This marks Hershy’s return to the securitization market after he retired from Morgan Stanley in January 2019.

    • 10 Aug 2020
  • Bank of Cyprus sells €916m of NPLs to Pimco

    The Bank of Cyrus has announced the sale of a €916m non-performing loan (NPL) portfolio to Pimco, dubbed Project Helix 2 after the first Project Helix cleared €2.7bn of NPLs from the bank’s balance sheet.

    • 07 Aug 2020
  • People moves in brief

    Krupa to replace Cabannes at SG — JP Morgan reshuffles activist defence business — Credit Suisse gives Cohen new position

    • 06 Aug 2020
  • LendingPoint CEO Tom Burnside on the growth of PoS lending

    Point-of-sale (PoS) and small business lender LendingPoint has experienced strong growth in recent years thanks to the growing segment of young consumers that prefer term loans over a credit card. Tom Burnside, co-founder and CEO of the company, spoke with GlobalCapital about why the industry is gaining traction and its upcoming plans for securitization.

    • 06 Aug 2020
  • FCA urges stricter criteria for high cost lenders

    The UK’s Financial Conduct Authority (FCA) has laid out expectations for how repeat non-bank lenders should behave once they resume lending, pushing firms to make operational changes to improve customer welfare.

    • 06 Aug 2020
  • Demand for CMBS aid grows on Capitol Hill

    The US commercial mortgage backed securities (CMBS) market has lacked the kind of extensive government support that other asset classes have received, though data shows it is experiencing difficulties. But some are optimistic that the US government will provide aid for the market in its next round of Covid-19 relief measures.

    • 06 Aug 2020
  • Janus eyes mid-sized investors with triple-A CLO ETF

    Asset manager Janus Henderson is planning to bring CLOs to mid-size institutional investors with an exchange-traded fund (ETF) focused on triple-A CLOs, it emerged this week. The ETF could broaden the CLO investor base beyond large banks and insurance companies.

    • 05 Aug 2020
  • Southern Europe NPL securitizations run into trouble

    Two NPL securitizations originated via the Italian guarantee scheme (GACS) have hit trouble following a fall in collections due to the coronavirus crisis, with the deals triggering interest payment shortfalls on the junior notes.

    • 05 Aug 2020
  • Kroll downgrades Kabbage, Funding Circle small business ABS

    Kroll’s recent downgrades of three classes of notes issued by online small business lender Kabbage, just one week after the rating agency took negative rating action on six notes from Funding Circle, show the distress rising up from businesses to the marketplace lending sector as a result of the coronavirus pandemic.

    • 05 Aug 2020
  • European CLO equity tranches could outdo US returns

    European equity tranches in CLOs have begun to outperform equivalent equity pieces from the US after its response to the coronavirus pandemic drove macroeconomic worries.

    • 05 Aug 2020
  • Sloppy machete: Pizza Express runs out of dough

    Pizza Express’s plans to restructure its debt, shut restaurants and sell its UK business have hammered home the latest nail in the coffin of the UK casual dining sector. As appetite for eating out dwindles following lockdown, coupled with a heavy oversupply of mid-market restaurant chains, the coronavirus pandemic has hastened the decline of a sector which has dominated UK dining over the past few decades.

    • 05 Aug 2020
  • Lack of CLO ratings transparency damages credibility

    Rating agency reviews of CLOs are not resulting in mass downgrades in Europe. That has caused some to question what is going on given the damage the coronavirus pandemic and lockdowns must surely have had on certain sectors of the economy that some CLOs are exposed to. Some transparency around ratings metrics would help soothe the angst.

    • 04 Aug 2020
  • Janus Henderson launches triple-A CLO ETF

    Janus Henderson is planning an exchange traded fund (ETF) that will invest in the safest tranches of CLOs, according to a filing with the Securities and Exchange Commission.

    • 04 Aug 2020
  • European CLOs weathering downgrade risk

    Rating agency reviews of CLO tranches which began in April are coming to an end, with the majority keeping their scores in early signals that the sector may avoid a mass of downgrades.

    • 04 Aug 2020
  • Former Morningstar MD joins blockchain securitization platform

    Cadence, a blockchain based securitization platform for private credit, has added Rohit Bharill to be the firm’s first head of risk, a company executive told GlobalCapital. Bharill joins from Morningstar Credit Ratings, where he headed the ABS and CLO ratings team.

    • 04 Aug 2020
  • New LA-based asset manager acquires CLO contract

    Ducenta Squared Asset Management recently obtained the management contract for a CLO managed by Tortoise Credit Strategies, a firm that Ducenta acquired in April, according to a source familiar with the purchase.

    • 03 Aug 2020
  • Citi snags European CLO syndication head from Credit Suisse

    Citi has hired Florent Chagnard from Credit Suisse to head European CLO syndication in the firm’s London office, according to sources familiar with the situation.

    • 03 Aug 2020