ABS - All Articles

  • Fitch appoints Paladino as North America head of structured finance

    Fitch Ratings appointed Michael Paladino as the new head of structured finance for North America, its latest update from a global reshuffle.

    • 25 Nov 2020
  • EBA gives hope to SRT market

    The European Banking Authority has lifted the spirits of those working in the significant risk transfer (SRT) market by suggesting that call options and early termination rights should not disqualify a transaction from achieving SRT recognition, pushing back on proposals made by European Parliament members.

    • 25 Nov 2020
  • Greene King securitization faces default as bondholders face a choice

    Greene King’s pub securitization Spirit Issuer is expected to default this year, after bondholders declined to waive potential covenant breaches in the same way they did for other pubcos, including the company's larger, whole business securitization. This will give bondholders the right to enforce security, but will test whether creditors want to take over the assets outright.

    • 25 Nov 2020
  • Ford, Dongfeng Nissan compete with auto ABS deals

    Ford Automotive Finance (China) and Dongfeng Nissan Auto Finance Co both returned to the onshore auto loan asset backed securities market this week, enticing investors with similar yields.

    • 25 Nov 2020
  • Now is not the time to rush an ESG securitization framework

    An ESG framework for the European securitization market is a noble aim but the middle of this pandemic is not the time to implement it. The European Parliament needs to take its time and make sure such a regime is built to last, and not throw it in alongside emergency legislation.

    • 24 Nov 2020
  • Student loan forgiveness remains looming nightmare for market, sources say

    Student loan forgiveness has been one of the main pillars of Joe Biden’s election campaign, worrying student loan securitization specialists in the sector since early this year. With Biden’s inauguration around the corner, market participants are scrambling to prepare for new regulations that could impact their student loan ABS investments.

    • 24 Nov 2020
  • CBAM returned to CLO with pre-Covid reinvestment period

    CBAM priced a $329M CLO on Tuesday, joining a handful of managers that are gradually pushing out reinvestment periods back to the pre-Covid five year standard.

    • 24 Nov 2020
  • FCA rolls out STS deal list ahead of Brexit

    The UK’s Financial Conduct Authority has launched a new platform dedicated to listing all securitizations which qualify as ‘simple, transparent and standardised’ (STS), preparing the UK securitization market for the end of the Brexit transition period.

    • 24 Nov 2020
  • Tepid CLO market rallies on vaccine news

    A wider market rally boosted by positive vaccine news from Pfizer, Moderna and the University of Oxford has begun feeding into the European CLO market, tightening secondary spreads while primary markets remain more sluggish.

    • 24 Nov 2020
  • Record low rates to boost RMBS issuance in 2021

    The RMBS market is expected to see more issuance in 2021, boosted by all-time lows in mortgage rates and a faster dealmaking process enabled by technology borne out of the pandemic.

    • 23 Nov 2020
  • Ares prices the tightest CLO of Covid-19 era

    A flurry of primary CLO deals in the BSL and middle-market opened up post-election supply in the US last week, with Ares Management achieving the tightest spread on triple-A rated paper since the pandemic and Pimco returning as issuer after a 13 year absence.

    • 23 Nov 2020
  • First European CLO switches to semi-annual payments

    Penta CLO 2 has become the first CLO to switch its coupon payment form three-month Euribor to six-month Euribor, according to Fitch Ratings on Monday, following the flood of underlying loan borrowers choosing to push payments onto the longer timeline.

    • 23 Nov 2020
  • Schroders targets pandemic opportunity with new private securitized fund

    Schroders has closed a new private credit fund, which will use a mix of securitized bonds, warehouse lines, direct loans and other instruments to target dislocated opportunities as the impact of the Covid-19 pandemic plays out in credit markets.

    • 23 Nov 2020
  • Goldman changes UK IB and ECM leadership

    Goldman Sachs has appointed new heads of its UK investment banking and EMEA equity capital markets businesses.

    • 20 Nov 2020
  • Mercedes-Benz auto ABS sees spreads retrace

    Mercedes-Benz priced Silver Arrow 12 on Thursday at one of the tightest auto ABS prints of the year, putting spread levels back in line with September prices, with the help of arranger Crédit Agricole.

    • 20 Nov 2020
  • CLO investors shift as banks make way for smaller buyers

    The Covid-19 pandemic has reshuffled the CLO investor base, with big bank buyers cutting their exposures, and insurers and mutuals gaining shares. Smaller pension funds and high net worth individuals have also entered the sector, tempted by the surprisingly strong performance of the asset class through the crisis period.

    • 19 Nov 2020
  • Market pushes back on ‘rushed’ ESG criteria for securitization

    The securitization market is pushing back against proposals in the European Parliament to tack a green framework for ABS deals onto existing discussions about NPL and synthetic securitizations that were supposed to be rapid-fire amendments to help the market fight off Covid-induced economic woes. Tom Brown reports.

    • 19 Nov 2020
  • Calabria pushes pedal on GSE reform before Biden takes office

    The Federal Housing Finance Agency (FHFA) issued its final capital rule on Wednesday, mandating more capital for Fannie Mae and Freddie Mac to ensure they exit conservatorship on a ‘sound capital footing’. The agency’s progress towards privatisation could be limited by the likelihood that President-elect Joe Biden will switch out FHFA boss Mark Calabria for a Democratic pick.

    • 19 Nov 2020
  • SCIO Capital reunites Deutsche ABS veterans with new advisory board

    Investment firm SCIO Capital has appointed three ABS professionals to its newly founded advisory board, reuniting a group of Deutsche Bank veterans who worked at the bank in the early 2000s.

    • 19 Nov 2020
  • Middle-market deals set to fire up CLO primary

    At least two new middle-market CLO deals and two resets are being readied to open up a primary market that has been quiet since the end of October.

    • 18 Nov 2020
  • Burger chain cooks up whole biz ABS

    Fast food franchise company CKE Restaurants Holdings priced a $400m whole business securitization several points tighter than initial pricing thoughts. With Roark Capital as its sponsor, the transaction stands out among other brands for its reliable performance and name value, sources say.

    • 18 Nov 2020
  • Dongfeng Nissan plans swift return to China ABS

    Dongfeng Nissan Auto Finance Co is set to launch a Rmb4.9bn ($747m) auto loan asset backed securitization next week.

    • 18 Nov 2020
  • Aircraft ABS spreads tighten but collateral stress remains

    The aircraft ABS market saw spreads tightening by as much as 75bp last week, driven by optimism over coronavirus vaccines, and spreads are continuing to benefit from the hope that travel will soon recommence. Despite the market’s positive reaction, sources caution that the tightening could be short-lived, as it will take longer than anticipated to see collateral performance fully recover to pre-pandemic levels.

    • 17 Nov 2020
  • Dutch debut sees Citi planning multi-year RMBS shelf

    Citi is planning to issue at least two deals a year from its new Dutch buy-to-let RMBS programme, putting the Jubilee deals on par with the bank’s Canada Square shelf in terms of issuance. Citi released an update for the €213m Jubilee Place 2020-1 on Tuesday, guiding the class ‘A’ notes in the 110bp area.

    • 17 Nov 2020
  • Canada-based manager gains SEC approval, buys Garrison CLOs

    Mount Logan Capital has acquired management rights to two middle-market CLO contracts from Garrison Investment Management. The asset manager disclosed the acquisition in an announcement and said that it paid $3m to take over the two CLOs together with “certain side letter agreements”.

    • 17 Nov 2020
  • Indiana pension fund invests $60m in CLO equity and debt tranches

    Indiana Public Retirement System has committed $80m to Oak Hill Advisors Structured Products Fund II to invest across CLO debt and equity tranches in the US and Europe in the secondary market, according to a board meeting document.

    • 16 Nov 2020
  • European CLO managers see 2021 primary slump

    The first quarter of 2021 is set to be a cautious opening for the European CLO market, with many banks still unwilling to open new warehouses, given the volatility of this year. Sources anticipate just five to six deals landing in the first quarter.

    • 16 Nov 2020
  • Sunnova, Loanpal light up solar ABS sector

    Sunnova is entering the ABS market with a deal backed by residential consumer solar loans, shortly after Loanpal made its return. With yields still at all time lows, solar securitizations have appealed to investors and traders for their high returns, and a transaction structure that looks more like a mortgage product than an esoteric ABS.

    • 16 Nov 2020
  • BNPP sets up €500m warehouse with German consumer lender

    Private-equity backed Auxmoney, the largest credit marketplace in Continental Europe, is planning to originate its own equity for consumer loans with the help of BNP Paribas, setting the firm on track to potentially securitize its assets.

    • 13 Nov 2020
  • Jefferies, Kennedy Lewis commit $160m to TCW CLO business

    Jefferies and Kennedy Lewis Investment Management will invest $160m with asset manager TCW to boost the firm's CLO issuance program over the next two years.

    • 12 Nov 2020
  • Sources say new mortgage servicer rules an 'overreach'

    State regulators announced a set of ‘safety and soundness’ standards for non-bank mortgage servicers, which include higher capital and liquidity requirements. While the new rules are aimed at providing better protections during a stress event, sources argue that states are imposing too harsh a standard on the private, non-deposit taking institutions.

    • 12 Nov 2020
  • UK RMBS market hunts for solutions to legacy Libor switch

    Kensington Mortgages and Yorkshire Building Society are looking into replacing the Libor benchmark with Sonia plus a spread adjustment for legacy contracts, easing the switch of sterling RMBS bonds while the UK market awaits further guidance from its regulator.

    • 12 Nov 2020
  • CLO equity offers opportunity but few funds stand ready

    CLO equity is still a scarce commodity, despite better than expected performances from the asset class this year in the face of the pandemic. Some investment firms are said to be raising CLO equity funds, but others suggest it remains hard going, and managers with captive funds will remain in charge.

    • 12 Nov 2020
  • EU auditor: CMU ‘results still to come’

    The European Court of Auditors has said that the EU’s Capital Markets Union still needs a lot of work and that obstacles to capital flowing across borders often relate to national laws. It also did not see signs of growth in the securitization market.

    • 12 Nov 2020
  • CLO pipeline builds but managers nervously eye defaults

    The fractious final phase of the presidential election has suspended CLO issuance since October 30. New issuance is expected to resume at steady pace through to the end of the year, but CLO managers say they are concerned about a new wave of defaults as the economy limps into 2021.

    • 11 Nov 2020
  • Upstart files for IPO as longer-term questions loom

    Marketplace lender Upstart announced its plans to go public, leveraging its recent success in bringing the company to profitability in the fourth quarter of 2019. However, sources say a competitive marketplace and a reliance on a handful of bank partnerships will pose challenges for the company.

    • 11 Nov 2020
  • Parliament passes securitization ‘quick fixes’

    The European Parliament voted on Tuesday to pass a package of amendments to the securitization framework aimed at freeing up bank balance sheets and increasing lending to the real economy. The so-called "quick fixes" were left largely unchanged, helping the proposals push quickly on to the trilogue process.

    • 11 Nov 2020
  • Citi brings principal Dutch RMBS from new BTL shelf

    Citi is making its Dutch buy-to-let RMBS debut, with the first deal from its new Jubilee Place shelf, which brings together mortgages from three different originators. A full stack €213m deal is on offer, with the equity pre-placed and Citi holding the retention.

    • 11 Nov 2020
  • Debt buyer double as Hoist and Encore prep refinancings

    Debt purchasing firms Encore and Hoist launched new refinancing transactions on Wednesday, taking advantage of good market conditions to strengthen their capital structures ahead of a likely NPL flood next year.

    • 11 Nov 2020
  • VW returns to China ABS with bigger revolver

    Volkswagen Finance (China) priced a nearly Rmb8bn ($1.2bn) auto loan asset-backed securities deal this week, the eleventh in its Driver China series.

    • 11 Nov 2020
  • Blackstone to rename GSO credit unit

    GSO Capital Partners, the credit management arm of private equity giant Blackstone, is rebranding itself as Blackstone Credit, the company announced this week.

    • 10 Nov 2020
  • For the good of all society retail payment relief must be a two-way street

    With the UK in its second lockdown, there is growing frustration among commercial landlords that retailer tenants are taking advantage of payment waivers. It is vital for the health of the commercial real estate sector and the pension funds that finance it that this is not allowed to happen.

    • 10 Nov 2020
  • Covid-19 will reshape US student debt more than Biden

    US president-elect Joe Biden’s student debt relief plan is a dialled down version of what Democratic candidates were proposing on the campaign trail in the run up to the 2020 election. But rather than focus on the incoming president’s priorities, observers should be thinking about the lasting impact of the Covid-19 pandemic on the $1.6tr of outstanding student debt.

    • 10 Nov 2020
  • Biden win creates new headwinds for fintech, mortgages

    Fintechs and mortgage lenders are eyeing the incoming administration with trepidation, as president-elect Joe Biden is likely to switch out the leadership of key agencies. While there won’t be drastic changes coming out of Congress, the president has power to remove single agency heads without cause, following a recent decision by the Supreme Court.

    • 10 Nov 2020
  • CarVal to securitize last of Catalunya Banc mortgages

    CarVal Investors is bringing its second Spanish RMBS securitization backed by re-performing loans originated by Catalunya Banc, mandating Natwest as arranger and Barclays and Standard Chartered as joint leads to syndicate the remainder of a portfolio it acquired from Blackstone.

    • 10 Nov 2020
  • Great Wall parks internationally rated ABS with investors

    Chinese auto finance company Tianjin Great Wall Binyin Automotive Finance Co got an international rating yet again for its return to the auto loan asset-backed securities market, a move that bankers say is in line with its ambitions to becoming more global.

    • 10 Nov 2020
  • Ex-Ares trio launch CLO management business

    A trio of former Ares Management executives have launched a CLO management business with a particular focus on environmental, social and governance (ESG) investments.

    • 09 Nov 2020
  • CRE tenants and landlords clash during second lockdown

    European retail landlords are facing up to potential damage of Europe's wave of second lockdowns, with many tenants continuing to ask for full rent relief despite trading for three months at least over the summer, throwing the sector's long term health into doubt.

    • 09 Nov 2020
  • Thames Water preps tender to term out holdco debt

    Thames Water’s holding company is preparing a sub-investment grade bond and tender offer to push out its 2022 maturity, launching the new offer as markets firmed up on Monday.

    • 09 Nov 2020
  • In Biden win, market grows hopeful for pandemic plan

    Capital markets cheered the victory of president elect Joe Biden on Saturday, hopeful his presidency will prove more predictable than the four years of the Trump administration. As the US grapples with a resurgence of Covid-19 infections, sources say they are optimistic that Biden will provide more concrete plans to guide the nation through the pandemic.

    • 09 Nov 2020
  • Trinity completes second railcar ABS since pandemic

    Trinity returned to the securitization market with back to back deals for the first time this year. Sources say the railcar sector will likely benefit under a Joe Biden administration as they believe the Democratic candidate will soothe trade war tensions with China and boost global trade.

    • 06 Nov 2020
  • Alpha Bank receives binding bids on Hercules NPL portfolio

    Alpha Bank has received two binding bids for the sale of an NPL portfolio worth around €10.6bn, closing the securitization process via Greece's Hercules guarantee scheme and cleaning its balance sheet to make way for new lending.

    • 06 Nov 2020
  • Wells Fargo slashes award winning CLO research desk

    Wells Fargo has laid off its prolific CLO research team led by David Preston as part of a decision at the bank to revamp its approach to fixed income research, according to people familiar with the matter. The US banking giant is searching for a new head of ABS and CLO strategy, according to a job posting published on Thursday by executive search firm The Ladders.

    • 05 Nov 2020
  • ECB supervisor’s bad bank dream faces huge obstacles

    The European Central Bank is offering renewed support to the idea of the EU creating a ‘bad bank’ or an asset management company to manage a flood of non-performing loans engulfing European banks, fuelling expectations that this will be part of the European Commission’s forthcoming NPL strategy. Jon Hay and Owen Sanderson report.

    • 05 Nov 2020
  • Alantra targets performing loans with new securitization build-out

    Alantra, the boutique investment bank in Spain, wants to expand its securitization franchise beyond its existing strengths in NPL deals, boosting its position as an advisor for specialist lenders in performing credit and structurer of risk transfer deals for Europe’s smaller banks. Francesco Dissera, who started at the firm in mid-October, will lead the team’s growth efforts.

    • 05 Nov 2020
  • Private sector buyer joins water securitization programme

    Notes in an infrastructure securitization programme called Viveracqua Hydrobond have been placed with a private sector buyer, Kommunalkredit Austria, for the first time, in a major step forward for an unusual asset class.

    • 05 Nov 2020
  • Mercedes-Benz Leasing debuts China auto lease ABN

    Mercedes-Benz Leasing Co sold its first auto lease asset-backed note in China’s interbank market this week, navigating a number of hurdles to launch the Rmb4bn ($600m) deal.

    • 05 Nov 2020
  • CLO market waits for dust to settle before deal flow restarts

    As Tuesday's vote count looks likely to drag into Thursday without a clear winner in the US presidential race, the CLO space is likely to remain stalled through next week after managers raced to get ahead of the US election to price around $13bn of deals in October.

    • 04 Nov 2020
  • Disappointing 'blue wave' dashes hopes for heftier stimulus

    US securitization players say they were surprised and disappointed that a Democratic “blue wave” failed to materialize as the results of Tuesday's election rolled in. With Republicans looking likely to hold the Senate and Democrats holding the House, market participants are anxiously expecting a smaller and delayed Covid-19 stimulus package regardless of who wins the presidency.

    • 04 Nov 2020
  • Market pushes back on STS lobby proposals for CLOs

    The Alternative Credit Council (ACC) has recommended allowing CLOs to obtain a ‘simple, transparent and standardised’ (STS) certification to increase the flow of funding to European borrowers. Investors have pushed back on such proposals, however, citing the heavy due diligence needed to invest in STS deals.

    • 04 Nov 2020
  • European ABS market confident despite US vote anxiety

    The European ABS market remains confident despite the inconclusive outcome of the US presidential election as GlobalCapital went to press on Wednesday. The sector is one of the few capital markets to see deal activity this week, with Citizen Irish’s auto ABS pricing late on Wednesday.

    • 04 Nov 2020
  • Navient, CommonBond get deals off ahead of election

    Navient and CommonBond both brought private credit student loan ABS deals to the market on the cusp of US elections. Depending on the outcome, lenders will have to navigate a sector fraught with risk as reform supported by the Democrats could tamp down student debt in borrowers’ payment priority.

    • 03 Nov 2020
  • CIO of structured credit investor Medalist steps down

    Medalist Partners has parted ways with CIO Brian Herr, who stepped down as CIO and co-head of structured credit and asset finance to take up a role as managing director at financial services company Exos.

    • 03 Nov 2020
  • Citi and Deutsche rev up Irish auto ABS as US election kicks off

    First Citizen Finance is the only issuer out in the European ABS market this week, marketing an Irish auto ABS deal on the day of the US election, aiming to price between the high 70bp-80bp.

    • 03 Nov 2020
  • Alantra hires head of securitization from Santander

    Francesco Dissera, head of securitization at Banco Santander, is joining Alantra’s newly created securitization team.

    • 03 Nov 2020
  • Beijing Hyundai test drives revolving structure

    Beijing Hyundai Auto Finance decided to try a revolving structure for its Rmb4bn ($597m) return to the asset-backed securitization market in China, getting an around two times subscribed book.

    • 03 Nov 2020
  • Kayne Anderson, Napier Park price new five year CLOs

    Kayne Anderson Capital Advisors and Napier Park Global Capital each priced CLOs on Friday with pre-Covid reinvestment durations, joining a growing roster of managers that have returned to more normal CLO structures. Though they are becoming more frequent, sources say they expect the market to remain split between standard and Covid-era deal formats.

    • 02 Nov 2020
  • SoFi gets green light from OCC for bank charter

    Marketplace lender SoFi has received approval from the Office of the Comptroller of the Currency (OCC) to obtain a national bank charter, boosting its position as a contender among incumbent banks and online lenders active in the ABS market.

    • 02 Nov 2020
  • Second UK lockdown heightens RMBS uncertainty

    The Financial Conduct Authority has opted to give UK borrowers the option of deferring mortgage payments for another six months, after prime minister Boris Johnson announced a second four week lockdown across the UK on Saturday, with the possibility of a further extension.

    • 02 Nov 2020