The Bond Market Association's new European collateralized debt obligation committee is planning to expand the trade group's existing deal library to offer it to investors outside the U.S., according to Nadine Cancell, v.p. and assistant general counsel at the group and an advisor to the committee. Currently, the deal library is only open to qualified institutional buyers, as defined by the Securities and Exchange Commission's Rule 144a. European investors, however, are prohibited from accessing the documentation because they fall under Regulation S, which governs non-U.S. entities. And, while most CDOs are sold as dual 144a and Reg S transactions and have a diverse mix of participants, U.S. investors have access to more transparency, according to Cancell. This will put investors on a level playing field with respect to their access of information from the library. "They are a large part of the investor base and we want to open it up for them," she says.
Other initiatives have not yet been determined, she says, although she adds the core goals will be the same as those for the U.S. group, which seeks to grow the market and increase transparency. Fritz Thomas, managing director and head of CDO structuring and distribution at Deutsche Bank, is chairing the new committee, while Oldrich Masek, managing director and co-head of global structured credit origination at J.P. Morgan Securities, has been tapped as vice chair.
Cancell says although the European group will work closely with the U.S. one and European members have participated in the U.S. group meetings, it was necessary to create a distinct committee. "There are issues that are more unique to the different markets and we wanted to have a mechanism in place to address those issues," she explains.