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Derivatives

CharterMac, IXIS Launch CDS Product Company

CharterMac and IXIS Capital Markets have launched Centerbrook Financial through which they aim to provide credit enhancement for Chartermac's securitizations and tax credit partnerships.

CharterMac and IXIS Capital Markets have launched Centerbrook Financial through which they aim to provide credit enhancement for Chartermac's securitizations and tax credit partnerships. Centerbrook's first transaction is the creation of a pool of credit-default swaps for the re-securitization of a USD820 million pool of CharterMac's existing multifamily revenue bonds. The company eventually aims to provide credit-default swaps and other credit derivatives to the affordable housing sector (DW, 2/27).

In addition to initial equity contributions from CharterMac and IXIS, Centerbrook has entered into senior and mezzanine debt facilities totaling USD155 million from four financial institutions. Centerbrook's senior debt received an AAA/Aaa rating from Standard & Poor's and Moody's Investors Service.

Centerbrook is 90% owned by CharterMac and the remainder is owned by IXIS. The venture allows IXIS to further tap into the growing real-estate derivatives space, an official said.

 

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