ABS

  • NPL partnership inked

    Intesa Sanpaolo and Intrum have agreed to form a strategic partnership in respect of non-performing loans. The agreement involves two transactions, including what is expected to be a landmark securitisation for the Italian market.

    Under the partnership, the Italian NPL platforms of Intesa Sanpaolo and Intrum will be integrated to create a servicer with around €40bn of assets .......

    News 18 April 2018

  • Market moves - 13 April

    Aircraft ABS on watch
    KBRA has placed the class A, B and C notes of the US$411m Prop 2017-1 ABS on watch for downgrade. The ABS represents the first securitisation from Elix Aviation Capital, with the proceeds being used to buy 63 aircraft on lease to 17 airlines in 12 countries. KBRA notes that one aircraft was not delivered to .......

    Market Moves 13 April 2018

  • Microfinance ABS regroups after defaults

    A number of Indian microfinance loan securitisations recently defaulted, halting a trend of strong performance and steady growth in the asset class. While demonetisation is partly to blame, lender overexpansion and the introduction of a competing credit instrument also took their toll.

    Several firms have historically used securitisation to fund their microfinance lending in India, culminating in 2016 .......

    News Analysis 13 April 2018

  • Italian NPL securitisations outpace loan sales

    Non-performing loan securitisation volume has outpaced outright sales in Italy, as banks seek to benefit from the GACS guarantee scheme. The trend is expected to continue this year, thanks to a strong track record over the last 12 months and an investment shift towards Southern Europe.

    Italian NPL transaction volume last year totalled €32.67bn across 33 deals (up from €12.54bn .......

    News Analysis 12 April 2018

  • Provisioning impact muted

    The ECB and European Commission have both put forward new rules for minimum loss coverage, which are a step towards improving provisioning practices across Europe and avoiding future unreserved non-performing loan build up. Although having two different sets of rules may create regulatory uncertainty across the banking sector, the impact for NPL securitisation seems muted.

    “The rules deal .......

    News Analysis 11 April 2018

  • Financial guarantee ILS debuts

    Build America Mutual Assurance Company (BAM) is in the market with what is believed to be the first ILS to transfer the risk of loss on a portfolio of financial guarantees. The Fidus Re Series 2018-1 transaction features US$100m twelve-year class A notes, with a five-year par call.

    BAM provides financial guarantees exclusively on lower risk segments of .......

    News 10 April 2018

  • Market moves - 6 April

    Europe

    CSC has hired Robert Berry as chairman of its capital markets group in London and Debra Parsall as director, also in London. Berry was most recently global head of capital markets at Intertrust Group. Parsall was most recently a director of capital markets at SFM Europe.

    The Bank of England has hired Antonio Guevara as an ILS specialist. Guevara .......

    Market Moves 6 April 2018

  • Market moves - 29 March

    Europe

    Man Group has hired Simon Finch as cio of credit at Man GLG, its discretionary investment management engine. In this newly created role, Finch will be responsible for Man GLG’s credit business and will have oversight of the credit portfolio management teams. He will report to Teun Johnston, ceo of Man GLG, and work closely with Man GLG’s cio, .......

    Market Moves 29 March 2018

  • Synthetic NPLs gain traction

    The ECB’s latest non-performing loan provisioning guidelines are expected to trigger increased synthetic NPL securitisation issuance. Nevertheless, defining a credit event for a portfolio of loans that are already non-performing remains a significant challenge.

    The ECB guidelines prescribe full provisioning for unsecured NPLs after two years and seven years for secured NPLs. “This could potentially incentivise banks to .......

    News Analysis 29 March 2018

  • Euro ABS/MBS busy

    European ABS/MBS secondary market activity has picked up this week.

    “It’s been a busy week this week after a quiet week last week,” says one trader. “Overall, March has been busy and month-on-month secondary spreads are a little wider, but not by much.”

    The trader continues: “Everything is trading well, mainly at good levels with a generally .......

    SCIWire 29 March 2018

  • Innovative Dutch SRT completed

    Rabobank has completed an innovative Dutch significant risk transfer (SRT) deal with the EIF. The €128m financial guarantee is the lender’s only transaction where the second-loss risk has been fully transferred, as well as its first transaction under the CRD 4 in the SME space.

    The transaction will be guaranteed by the European Fund for Strategic Investments (EFSI). .......

    News 28 March 2018

  • Seeking to scale

    The capital relief trades (CRT) market suffers from a material gap between banks’ needs and the availability of investor capital, within the strategy. To facilitate growth, one of the next steps should be to attract greater buy-in from long-term investors, especially pension funds and their investment consultants.

    Kaikobad Kakalia, cio at Chorus Capital, believes that long-term investors - especially pension .......

    News Analysis 26 March 2018

  • Market moves - 23 March

    CDS clearing developments
    Intercontinental Exchange has transitioned index CDS open interest from CME Group to ICE Clear Credit, follows CME Group’s decision to exit the CDS business and transfer client positions to an alternative clearing house. ICE Clear Europe has also launched clearing for North American investment grade and high yield index CDS instruments, thereby providing regional customers the ability .......

    News 23 March 2018

  • Non-traditional ABS growth to continue

    There was record ABS issuance in 2017, with the most since the crisis. Non-traditional ABS accounted for around US$27bn, with whole business securitisation issuance reaching a record-breaking US$7.4bn, while aircraft ABS came back strongly after a quiet 2016.

    The growth of non-traditional ABS is being driven by investors reaching for yield. Of the various non-traditional sectors, including not .......

    News Analysis 23 March 2018

  • Risk transfer round-up - 23 March

    Credit Suisse is believed to have priced a capital relief trade referencing a loan book originated in Switzerland. The deal was allegedly 3x subscribed, with guidance at 7.625% but printing at 7%.

    Separately, arrangers note an increase in requests for transactions by standardised banks, with deals already said to be in the pipeline. Most of the transactions until now were .......

    News 23 March 2018

  • Grappling with uncertainty

    Capital relief trade issuers are incorporating structural features highlighted in the EBA’s risk transfer discussion paper in an effort to gain some regulatory certainty in the absence of any guidance. Challenges remain, though, as significant risk transfer (SRT) recognition will depend on negotiations between national regulators and banks.

    “There are a number of grey areas that can affect the SRT status of a .......

    News Analysis 23 March 2018

  • Increase in liquidity 'hard to measure'

    Liquidity in structured products is difficult to quantify, and perhaps even to define. Whichever way it is measured, traders agree that it has increased and predict that over the course of 2018 spreads are going to continue their long tightening trend.

    Liquidity is commonly identified by the presence of associated phenomena. Two-way markets made by dealers are considered to be .......

    News Analysis 22 March 2018

  • Marketplace lending now 'mainstream'

    The US consumer economy’s long recovery has now become well established and access to credit has developed markedly over the last few years. Marketplace lending ABS has become similarly well established in this environment and is set to continue its development, although there are fears that the market is now teetering towards a bubble.

    A senior executive at .......

    News Analysis 22 March 2018

  • Greek lease ABS prepped

    Hertz franchisee Autohellas is in the market with AutoWheel Securitisation, an ABS backed by operational auto leases extended to Greek corporates and SMEs. The €101.5m transaction is the first non-bank leasing securitisation to be executed in Greece.

    AutoWheel Securitisation is a cash securitisation with an 18-month revolving period, backed by auto leases and future sales proceeds from the .......

    News 19 March 2018

  • Market moves - 16 March

    EMEA

    Citigroup has appointed Laura Coady to the newly created position of head of EMEA, structured finance syndicate desk and she will continue to report locally to EMEA co-heads of global structured finance and securitisation Peter Keller and Bob Liao, and report globally to Vikram Prasad, global head of credit syndicate desk, taking responsibility for distributing all products from the .......

    Market Moves 16 March 2018

  • Doubling-up on due diligence?

    Securitisation investors believe that their own due diligence procedures will still be required on deals carrying the STS label, for fear they may lose the designation. Nevertheless, the STS framework is expected to lead to better quality ABS product, with reliance on the label increasing over time.

    Henry Cooke, executive director at Gryphon Capital, commented at a recent PCS seminar .......

    News Analysis 16 March 2018
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