Financial Guaranty Insurance Co. is planning to delve into the future-flow securitization business with the hire of Eric Rosensweig as managing director from competitor MBIA. Tim Travers, ceo of FGIC UK, the firm's international business line, said the hire and expansion plans are consistent with FGIC's broader strategy to expand its operations since it was sold by General Electric in 2003. "We have a game plan put in place to get up to be a mainstream monoline that can compete in all asset classes and the future flow business is something we should be involved in," Travers said.
As for Rosensweig, who spent seven years at MBIA, he will be responsible for bringing in business in international, namely emerging market, future flow securitizations. He will be based in New York and will also go after deals from in Canada, reporting to London-based Travers.
Although future flow technology can be applied to deals in any jurisdiction, Travers noted it makes the most sense to conduct such deals in emerging market countries with low sovereign ratings. By guaranteeing a pool of receivables owed to a blue-chip company in, say, a country with a double-B rating, Travers noted monoline involvement can help garner investment-grade funding costs for companies in countries with speculative-grade sovereign debt ceilings.
FGIC recently made two hires for its London office to bulk up its emphasis on corporate securitizations and infrastructure finance (BW, 5/16).