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Last week seemed like the best of times for the euro ABS market — a rare Belgian RMBS has hit the market, one of the biggest European forward flow deals, at least in terms of total size of assets purchased, is being taken out in the public market, and investors are hungry.
A syndicate banker told GlobalCapital that “euro ABS investors are in very good spirits right now”.
Despite a packed pipeline, bookbuilds seem to be progressing well this week. Every tranche of Auxmoney’s Fortuna 2026-2 was fully covered as of Wednesday morning. The same for Thetis 2026 from Crédit Agricole subsidiary Credibom, which issued Portuguese auto ABS for the first time.
Initial price thoughts are out for Ayvens’ Bumper Fr 2026-1, although there had been no book update by Wednesday lunchtime. Pricing is slated for Thursday.
The sterling market has its own deals to feel excited about. The biggest UK non-bank consumer lender is issuing a public ABS for the first time. UK consumer ABS in general seems to be blossoming into life, with four regular shelves launched since 2024 from Plata, Barclays and Admiral, Citi and Abound, and now Lendable.
Lendable’s debut has had a lot of early interest — all the notes were at least twice covered by Wednesday afternoon, with pricing expected on Thursday.
Yet, overall demand for sterling securitization does not seem to be as strong as in the euro market.
The illustrative case is JP Morgan’s Pierpont shelf, which is backed by UK buy-to-let mortgages. In January, the bank priced a deal at 77bp over Sonia. Last week, the same shelf came at 87bp, broadly in line with other recent prints in the sector.
“Spreads for the euro market are broadly back to January levels, give or take a couple of basis points, but that’s not been the case for sterling,” another banker said.
Tom Hall gets into all the reasons for the divergence between euros and sterling here. And there was another tale of two currencies discussed on the podcast this week: Golub Capital followed the multi-currency template of Ares and Barings with the first European middle market CLO.
