ABS
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Up, up and away
Recovery of GSE CRT/MILN deals from dark days of spring 2020 continues to impress
Although risks to performance remain, the recent impressive performance of GSE CRT and MILN transactions is set to continue, says Yash Shah, DBRS Morningstar vice president.
Shah was speaking yesterday (July 27) on a webinar organised by DBRS Morningstar, in which he was joined by Mark Fontanilla, founder of Mark Fontanilla and Company.
Improvement in collateral, high prepayment speeds and the fact .......
News Analysis 28 July 2021
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Risk on
Lower quality credit outperforms
The first half of 2021 has been universally positive for below-investment grade credit markets and for alternative credit funds. Indeed, stressed and distressed corporate credit generated the highest returns.
“If you fell asleep at the end of 2019 and woke up mid-way through 2021, you would look back and say these performance numbers don’t look too bad. Credit .......
News 28 July 2021
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Social vision
Edward Baker, capital markets director at Prodigy Finance, e...
Q: Prodigy Finance earlier this month issued a first-of-its-kind ABS backed by international private student loans (SCI 7 July). Tell us more about Prodigy Finance CM2021-1?
A: The US$288m issuance is Prodigy’s inaugural ABS and comes under Prodigy’s new social bond framework, marking a double debut in the fixed income market for the lender.The senior tranche of .......
Provider Profile 28 July 2021
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Growing foothold
CRC expands Latin American presence
Christofferson, Robb & Co (CRC) has fully acquired Colombian consumer lender Finsocial. The acquisition will help grow CRC’s foothold in the Latin American consumer market, although the firm will remain opportunistic towards that segment.
CRC has been investing in Latin American consumer finance since 2005, where middle and low-income consumers are underserved by banks. This contrasts with the .......
News 28 July 2021
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Summer hiatus
European ABS/MBS market update
Tight spreads, significant supply and general optimism have epitomised the first half of the year in European ABS/MBS. Now, as the primary market finally comes to a halt for the summer with only one deal widely marketing – Taurus 2021-4 UK, see SCI’s Euro ABS/MBS Deal Tracker for more – the secondary market appears to be entering hiatus .......
News 27 July 2021
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Disposals pending
Irish NPL activity set for rebound
The Irish non-performing loan market is set for a rebound in the second half of the year, following a hiatus due to the coronavirus crisis. Indeed, owner-occupied residential mortgages are expected to be a major area of focus for banks as they develop their future strategies against the backdrop of a post-Covid economy.
Ireland has been one of .......
News 23 July 2021
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Credit events
US moratoria challenges highlighted
The capital relief trades market has adapted to the existence of payment holidays by either excluding them from portfolios or limiting their presence in them. Nevertheless, payment holidays have raised challenges for US synthetic securitisations - although their removal isn’t expected to have a negative impact on US deals, given that the bulk of take-up rates occurred last year .......
News 23 July 2021
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Credit engagement
Raj Shourie, from Lockton's political and credit risks divis...
Q: Your role means that you will be responsible for leading the engagement with financial institutions internationally out of London, for both credit mitigation and country risk protection. Tell us more about what that will entail.
Provider Profile 22 July 2021
A: I’ll be responsible for originating business dialogue with banks and funds, targeting new users of credit and political risk insurance and existing users .......
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Asset quality boon
EU bank credit conditions normalise
Credit conditions for European banks are normalising and prospects for the second half of the year look positive. A return to pre-coronavirus crisis operating income with higher loss absorption buffers accumulated during the pandemic should facilitate the management of non-performing loans.
According to Scope Ratings, credit risk has frozen in time, due to the extraordinary support measures available .......
News 21 July 2021
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Jamaica in cat bond first
Sector developments and company hires
Jamaica in cat bond first
Market Moves 20 July 2021
The World Bank/IBRD has priced a catastrophe bond that will provide the government of Jamaica with financial protection of up to US$185m against losses from named storms for three Atlantic tropical cyclone seasons ending in December 2023. The government of Jamaica is the first government in the Caribbean region, and the first of any small island .......
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Recovery trade
Pub credit quality to diverge amid changing consumer behaviour
The UK pub sector has been one of the most severely affected areas of hospitality during the last 15 months. However, despite the turmoil during the pandemic, panelists participating in a recent S&P webinar expect a recovery to return to this sector within the next two years.
“It will take even longer to return to 2019 leverage levels .......
News 19 July 2021
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New CLO committee to tackle 'greenwashing'
Sector developments and company hires
New CLO committee to tackle ‘greenwashing’
Market Moves 15 July 2021
The European Leveraged Finance Association (ELFA) has created a new committee to establish industry best practice and serve investors in the CLO market. The CLO Investor Committee will provide a forum for members to identify CLO investors’ requirements, facilitate discussion on general market progress and key issues, and contribute to the regulatory dialogue on .......
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MPL rewards
Generous MPL returns stand out in parsimonious ABS market
ABS investors in the US searching for value in an environment otherwise starved of this should look at the marketplace loans (MPL) sector, suggest analysts.
One year AAA-rated unsecured consumer MPL ABS currently trade at around 40bp against the EDSF curve while three year A-rated MPLs are about 90bp to swaps.
“Nothing else is close to that. If you’re looking for value, unsecured .......
News Analysis 14 July 2021
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ILS efforts beefed up
Sector developments and company hires
ILS efforts beefed up
Market Moves 14 July 2021
AXIS Capital Holdings has appointed Chris Caponigro as global head of AXIS ILS, as its third-party capital unit has been rebranded. Caponigro will oversee the company’s activities related to third-party capital under management, supporting ILS efforts across its reinsurance and insurance segments. He will report to AXIS Re ceo Steve Arora and be based out of .......
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Bridging the gap
Sustainable SRTs to spur ESG securitisation growth?
A steady stream of renewables significant risk transfer deals is expected to come on to the market in the coming months. This CRT Premium Content article investigates whether synthetics can spur growth across the broader ESG securitisation sector.
Synthetic transactions referencing sustainable portfolios are being touted as a straightforward way to overcome the current paucity of suitable ESG assets ......
News Analysis 14 July 2021Premium Content
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Endless cash
European ABS/MBS market update
As the pre-summer flow comes to a close, optimism still prevails across the European ABS/MBS primary market. Despite strong execution from the four widely marketed deals last week and three still in the pipeline (see SCI’s Euro ABS/MBS Deal Tracker for more), further tight pricing levels are expected.
“The ABS-RMBS space has been exceptionally strong during these .......
News 14 July 2021
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Lift off
BMO programme details revealed
Further details have emerged of a synthetic securitisation programme launched by BMO in late December 2020. Dubbed Sauble, the programme will exclusively focus on leveraged loan issuance and is one of only two programmes dedicated to this segment. BMO has already printed two transactions from the Sauble programme - executed in December 2020 and June this year (SCI .......
News 12 July 2021