ABS
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Pandemic uplift
Covid-19 boosts NPL note sales
Non-performing loan note sales have increased by 70% since the start of the coronavirus pandemic and now account for an average of 12% of total collections. Servicers have increased note sales to compensate for lower judicial proceeds, given limited court activity during lockdowns, and a decline in collateral liquidity. However, uncertainties pertaining to NPL trading platforms and the EU’s .......
News 26 February 2021
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Injunction sought over Blue Owl combination
Sector developments and company hires
Injunction sought over Blue Owl combination
Market Moves 25 February 2021
Golub Capital Partners, one of 17 partner managers in the Dyal Capital Partners IV fund, has brought a lawsuit against the fund, Neuberger Berman Group (NBG) and NB Alternatives Advisers, seeking an injunction against the Blue Owl transaction (SCI 4 December 2020). Sixth Street previously filed a lawsuit against the Dyal Capital Partners .......
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Democratising access
Debut Indian wealth-tech bond repaid
The debut bond structured by Indian wealth-tech platform GrowFix has been fully repaid, with investors earning a 10% yearly return on the asset. The firm seeks to democratise investor access to fixed income assets yielding returns of 200bp-400bp over fixed deposits and intends to eventually launch multiple bonds on a monthly basis, depending on the demand.
Secured by .......
News 25 February 2021
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Record fundraising
Chorus exceeds SRT fund targets
Chorus Capital has concluded fundraising for Chorus Capital Credit Fund IV, its latest dedicated significant risk transfer fund. The firm has amassed US$1.4bn of capital commitments, well above the initial target of US$1bn. The fund represents Chorus Capital’s largest commingled investment vehicle to date and one of the largest private credit funds raised in Europe since the start of .......
News Analysis 25 February 2021
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Strong pipeline
European ABS market update
Bank of America’s Taurus 2021-1 UK has priced at tight levels for UK CMBS transactions on the back of significant demand (SCI 10 February). Against this backdrop, the European securitisation pipeline appears to be gaining strength.
“Generally, the market feels pretty busy. The pipeline is quite full, including new issuance and refinancings,” says one trader.
He .......
News 23 February 2021
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Supply issues
STS volumes concentrated in auto loans
Of the securitisation asset classes that qualify for STS status, auto loan ABS is where the label has been applied most frequently. In contrast, mortgage collateral is often diverted to support covered bond issuance or STS RMBS are retained.
Consumer and auto loan ABS, as well as prime and buy-to-let RMBS are eligible for the STS label. However, .......
News Analysis 23 February 2021
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Irish NPE portfolio offloaded
Sector developments and company hires
Irish NPE portfolio offloaded
AIB Group is set to sell a non-performing loan portfolio in long-term default to Mars Capital Finance Ireland as part of a consortium arrangement with Mars and affiliates of Apollo Global Management. At completion, AIB will receive a cash consideration of approximately €400m.As at September 2020, the loan portfolio had a gross NPE value .......
Market Moves 22 February 2021
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Galaxy securitisation finalised
Alpha and Davidson Kempner sign deal
Alpha Bank has signed a definitive agreement with Davidson Kempner with respect to its €10.8bn Galaxy portfolio (SCI 24 November 2020). The deal is the second largest rated non-performing loan securitisation in Europe and will reduce the lender’s NPE and NPL ratio in Greece by 24% and 13% respectively.
According to the terms of the transaction, Alpha .......
News 22 February 2021
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Small balance UK CMBS prepped
Sector developments and company hires
Small balance UK CMBS prepped
Together Commercial Financial Services is marketing an unusual securitisation backed by small balance commercial assets. Dubbed Together Asset Backed Securitisation 2021-CRE1 (TABS 2021-CRE1), the £328.8m transaction is backed by 1,482 loans provided to 1,399 borrowers.The average outstanding principal balance per borrower is £235,020 and approximately 41.9% of the underlying properties are either fully .......
Market Moves 19 February 2021
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Private role?
Benefits of tokenisation weighed
As investment trends shift more towards private financings, tokenisation could play an important role in facilitating transactions. However, obstacles remain to a more widespread adoption of blockchain technology.
“A small revolution is going on that could significantly improve the investment process in the private industry, in particular. As the focus is shifting from public financing to private financing, .......
News Analysis 19 February 2021
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Forgive and forget
Student loan forgiveness heralds widespread prepayment in student loan ABS, but is credit positive
Some form of student loan forgiveness now looks likely to happen, and the effects upon the Federal Family Education Loan Program (FFELP) ABS market will be considerable, as a large percentage of bonds in circulation will be paid down.
“We estimate loan forgiveness of $10,000 per borrower could result in 22% of the outstanding balance of FFELP loans .......
News Analysis 18 February 2021
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NDBI risk eyed
Economic resilience bonds in the works
Political risk and social volatility became headline news last month, with the storming of the US Capitol. One firm is attempting to connect such non-damage business interruption risks to the capital markets via ILS structures.
“Over the last decade, I’ve become increasingly interested in political risk and social volatility as a function of the internet. Technology has been .......
News Analysis 18 February 2021
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'Unique' CLN deal readied
Sector developments and company hires
‘Unique’ CLN deal readied
Market Moves 17 February 2021
JPMorgan Chase Bank (JPMCB) is prepping the debut CLN issuance from the JPMorgan Wealth Management Mortgage (JPMWM) platform to transfer credit risk to noteholders through a hypothetical tranched CDS on a reference pool of mortgages. Dubbed JP Morgan Wealth Management Reference Notes Series 2021-CL1, principal payments on the notes are based on the performance of a US$2.36bn .......
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Seasonal effects
Servicer boost for Italian NPL collections
Seasonality effects gave Italian non-performing loan collections a significant boost for the second year in a row, even though Italy went into a second lockdown in November. Volumes were 71% higher in December 2020, similar to the 77% rise seen in December 2019, when comparing respective April-to-November averages.
However, according to Scope Ratings, December 2020 collections were still .......
News 17 February 2021
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Maritime financing facility agreed
Sector developments and company hires
Maritime financing facility agreed
Market Moves 16 February 2021
Maritime and offshore alternative capital provider Fleetscape Capital has entered into an innovative financing structure with Macquarie that provides a more efficient offer to vessel owners seeking higher leverage situations. The structure utilises securitisation principles and enables Fleetscape to provide sale-and-leaseback or unitranche financing on competitive terms. Coupled with Fleetscape’s transaction execution capabilities and streamlined documentation, the .......
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MBIA litigation settled
Sector developments and company hires
MBIA litigation settled
MBIA Insurance Corporation has entered into an agreement to settle the litigation it filed in 2009 against Credit Suisse and certain affiliated entities (SCI passim). The settlement follows a post-trial decision by the Court awarding MBIA Corp approximately US$604m in damages and, pursuant to the settlement, Credit Suisse has paid MBIA Corp US$600m.This amount materially .......
Market Moves 15 February 2021
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Consumer SRT prints
Santander finalises capital relief trade
Santander has priced Santander Consumo Four, its latest full-stack capital relief trade. Backed by a €1.5bn Spanish consumer loan portfolio, the transaction is significant for its size and can only be matched by a German full-stack deal that the lender completed in October 2020 (SCI 29 January).
Rated by DBRS and Moody’s, the transaction consists of €1.26bn .......
News 15 February 2021
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UKML tender offers mooted
Sector developments and company hires
UKML tender offers mooted
Market Moves 12 February 2021
Coventry Building Society subsidiary Godiva Mortgages is set to purchase from UK Mortgages Corporate Funding two buy-to-let mortgage portfolios originated by Godiva and currently financed within the Cornhill No. 6 and Malt Hill No. 2 RMBS vehicles. Subject to successful completion, the timing of these sales is expected to coincide with the transactions’ payment dates in .......