ABS
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Non-traditional assets
ABCP boosted by demand, diversification
US ABCP outstanding is expected to grow moderately this year, as prime institutional money-market funds return to the market and new investors enter. At the same time, conduit sponsors are expanding their portfolios with non-traditional assets.
Money-market fund investment in ABCP fell drastically leading up to and following money-market reform in 2016 (SCI 22 August 2016). However, .......
News Analysis 25 April 2019
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Lender charged for overstating returns
Sector developments and company hires
CRT analytics
dv01 has launched a credit risk transfer market surveillance offering, which adds US$1.8trn of Freddie Mac STACR and Fannie Mae CAS securitisations to its loan-level data analytics platform. The service allows investors to analyse historical performance of CRT deals individually or combined, perform whole market analysis and run cashflow scenarios.MPL platform charged
Market Moves 23 April 2019
The US SEC has ordered Prosper Funding .......
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CLO manager denied incentive fee
Sector developments and company hires
Incentive fee ruling
Market Moves 18 April 2019
The High Court in London has ruled that Barings (UK), as collateral manager, was not entitled to an incentive fee at the expense of junior bondholders following the optional redemption of the Duchess VI CLO. Part 8 proceedings were brought by Deutsche Trustee Company, to determine the correct interpretation of the bond documentation in which Barings (UK) .......
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Risk transfer round-up - 18 April
CRT sector developments and deal news
Credit Suisse is believed to be readying a corporate capital relief trade from its Elvetia programme that is expected to close in June. The Swiss lender’s previous Elvetia trade closed in November last year (SCI 30 November 2018).
Another risk transfer transaction that is reportedly in the pipeline for this year is a commercial real estate deal from Raiffeisen. ......
News 18 April 2019Premium Content
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BMF administration order filed
Sector developments and company hires
BMF 6 tender
Market Moves 16 April 2019
An application for an administration order in respect of Business Mortgage Finance 6 was presented in the London High Court of Justice last week, with a return date of 18 April. The application was presented by Greencoat Investments, which is understood to be in the process of carrying out a tender process for the acquisition of certain .......
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Sonia success
European ABS market update
The first UK STS RMBS – Nationwide’s Silverstone Master Issuer 2019-1 – priced yesterday, with substantial demand seen for both the sterling and US dollar tranches. The transaction is also the debut deal to publicly place a floating coupon referencing Sonia.
Silverstone 2019-1’s US$350m triple-A rated 1.95-year class 1A notes printed at three-month Libor plus 57bp (compared to .......
Market Reports 16 April 2019
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ILS restructuring agreed
Sector developments and company hires
ILS restructuring agreed
Ballantyne Re has entered into a lock-up support agreement with Ambac Assurance UK, Assured Guaranty, approximately 82% by value of the class A noteholders, Security Life of Denver Insurance Company (SLD) and Swiss Re Life and Health America (SRLHA) in connection with a proposed restructuring transaction in respect of its obligations under the ILS notes. .......
Market Moves 15 April 2019
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Bulking up
Securitisation capabilities stretched
DLA Piper bulked up its securitisation capabilities to 20 lawyers for Stack Infrastructure’s inaugural and innovative ABS from February, due to structuring challenges. The potential for rendering the deal risk retention-compliant means that similar deals could be seen in Europe in the future.
Dubbed Stack Infrastructure Issuer series 2019-1, the deal is a securitisation of real estate and .......
News 12 April 2019
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Foreclosure uncertainty
ECJ ruling leaves Spanish NPL investors in the dark
The European Court of Justice’s (ECJ) 26 March judgement on early-termination clauses in Spanish consumer mortgage contracts could result in the use of quicker mortgage foreclosure proceedings in Spanish non-performing loan transactions. The final outcome rests with the Spanish courts, however, prolonging existing uncertainty over the course and length of Spanish foreclosure proceedings.
Antonio Casado, analyst at Scope, .......
News 12 April 2019
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BWIC boom
Quarterly SCI data update
The first quarter of a year is usually quieter than the previous quarter and, for the most part, 1Q19 saw reduced activity over 4Q18 (SCI 24 January 2019). The notable exception was CLO secondary markets, where BWIC volumes boomed for the second quarter in a row, according to SCI data.
....... News Analysis 11 April 2019
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Real estate relief
NPL provisioning rules published
The European Council of Ministers has adopted new rules for the provisioning of non-performing loans, which stipulate loss coverage for future NPLs with different coverage requirements depending on different NPL classifications. The text is a relief for Italian banks, given the application of the rules to newly created NPLs - both secured and unsecured. Furthermore, an exception to the .......
News Analysis 10 April 2019
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European bank in major restructure
Company hires and sector developments
COO hired
Trepp has appointed Luis Amador as coo, reporting to ceo, Annemarie DiCola. Amador was recently md at Moody's Analytics, responsible for structured finance financial engineering, product management, content production, and advisory teams, providing the fixed income marketplace advanced analytics, data, credit models, and portfolio monitoring products while also performing advisory, valuation, and consulting services across sectors.
Energy and .......
Market Moves 9 April 2019
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Independent director hired
Company hires and sector developments
Europe
Prytania Asset Management has appointed Eric Felton as independent director. Most recently, Felton spent 13 years as cfo of GCM Grosvenor and before that, he was an audit partner at Ernst & Young and Arthur Andersen in the financial services sector. Concurrently, Joseph MacHale is retiring from the Prytania board, after 16 years of service since the .......
Market Moves 5 April 2019
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Positive outlook
UTP securitisation prospects improve, despite challenges
Future issuance of unlikely-to-pay (UTP) securitisations depends on the resolution of two challenges - namely, information asymmetry and the lack of hybrid servicing models. However, ABS might prove a better solution for mixed portfolios, given the presence of alternatives for large corporate UTP loans.
According to Scope Ratings’s calculations, Italian banks could dispose of €13bn to €18bn of .......
News Analysis 5 April 2019
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CEO appointed
Company hires and sector developments
CEO appointed
DFG Investment Advisers has hired Oliver Wriedt as ceo. The firm is also unifying its products under one brand, Vibrant. Wriedt will play an instrumental role in growing and further institutionalising DFG’s business, helping to diversify its product offerings and elevate the new Vibrant brand among the investment community. He was most recently co-ceo of CIFC .......
Market Moves 4 April 2019
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Risk transfer round-up - 3 April
CRT sector developments and deal news
Deutsche Bank has completed its first capital relief trade for the year. Dubbed CRAFT 2019-1, the US$382.5m nine-year CLN pays a coupon of 10.3%. The transaction features a seven-year WAL and a two-year non-call period.
The German lender’s last CRAFT transaction was inked in June 2018. Dubbed CRAFT 2018-2, the US$210m CLN paid Libor plus 10% (see SCI’s capital relief ......
News 3 April 2019Premium Content
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Obstacles remain
European Parliament postpones NPL trading vote
The European Parliament on Monday (1 April) postponed a vote on a non-performing loan secondary market directive until next week, increasing the time pressure to reach an agreement with the European Council before May’s parliamentary elections. The challenging timeframe is further complicated by controversial parliamentary amendments to the original draft, including higher initial capital for servicers and caps on fees .......
News 3 April 2019
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Positive sentiment?
European ABS market update
European ABS primary issuance is gaining momentum, as the second quarter begins. Indeed, the variety of deals on offer appears to be boosting sentiment, with a newly announced marketplace lending securitisation joining the re-performing and non-conforming RMBS in the pipeline (see SCI’s deal pipeline).
“The European primary market is a lot busier than it was even a .......
Market Reports 2 April 2019
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GSE reforms proposed
Sector developments and company hires
Debt service reserve guarantee provided
Assured Guaranty (Europe) plc (AGE) has issued a £135m, five-year Debt Service Reserve (DSR) Guarantee to benefit Dwr Cymru (Financing) Limited and Dwr Cymru Cyfyngedig, both companies forming part of the Welsh Water group. The guarantee provided by AGE will replace the existing liquidity facilities provided by banks within the Welsh Water group’s securitisation structure. .......
Market Moves 1 April 2019
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Irish BTL RMBS launched
Company hires and sector developments
Irish BTL RMBS launched
Bank of Ireland has mandated a new Irish buy-to-let RMBS deal. Dubbed Mulcair Securities, the €358m transaction securitises a legacy BTL loan portfolio that was originated by the Bank of Ireland, ICS Building Society and Bank of Ireland Mortgage Bank. The rationale behind the deal is to offload non-performing exposures from the seller’s balance sheet (according to .......
Market Moves 29 March 2019
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CEO appointed
Sector developments and company hires
CEO appointed
Curtis Arledge has joined Mariner Investment Group as chairman and ceo. In addition to his role at Mariner, Arledge will serve as head of Mariner subsidiary, ORIX USA asset management, responsible for driving the company’s overall strategy in the space, including facilitating opportunities for growth across ORIX USA’s enterprise. A founding member of Mariner, Arledge has returned to .......
Market Moves 28 March 2019