Complete news archive
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SCI Start the Week - 13 March
A review of SCI's latest content
Last week's news and analysis
News 13 March 2023
Climate call
Calls for ESG synthetics framework grow
'Conflict of interest' undermines CRT
Lawyers ring alarm bells about possible impact of SEC ruling on CRT market
Corporate SRT launched
Nordea said to have finalized corporate SRT
No good news
Powell's testimony suggests higher cap requirements not ruled .......
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SVB failure liquidity-driven
Outsized, unhedged MBS holdings behind bank run
Securitisation analysts have been quick to emphasise that the collapse on 10 March of Silicon Valley Bank (SVB), which marks the largest bank failure since the financial crisis, is not a credit story and that the broad US banking system remains well-capitalised. Indeed, there are some very specific circumstances surrounding SVB’s demise, with rising interest rates – and the .......
News 13 March 2023
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ICE merger challenged on 'competitive harm'
Sector developments and company hires
ICE merger challenged on ‘competitive harm’
The US FTC is seeking to block the proposed merger between Intercontinental Exchange (ICE) and its top competitor, Black Knight (SCI 5 May 2022). The regulator claims that the merger would drive up costs, reduce innovation and reduce lenders’ choices for tools necessary to generate and service mortgages.ICE owns the dominant .......
Market Moves 10 March 2023
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Hybrid stop-loss deal closed
Sector developments and company hires
Hybrid stop-loss deal closed
Market Moves 8 March 2023
Swiss Re has closed its second hybrid bank financing and ILS transaction (SCI 22 April 2022). Building on the firm’s first innovative hybrid transaction from April last year, the latest multi-year stop-loss transaction provides Swiss Re with US$700m in underwriting protection for the financial years of 2023 to 2027, as it continues to pursue profitable .......
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SEC-SA and the death of public securitisation
Adam Croskery, head of debt financing and structuring at Arr...
In the early 2010s, I was a mortgage structurer at the forefront of the birth of NC2.0 (the non-conforming 2.0 sector). Even before then, I rated RMBS transactions at a major rating agency. If anyone should be a cheerleader for public securitisations, it’s me.
There is no doubt that public transactions are academically appealing (if somewhat exhausting) to .......
Talking Point 8 March 2023
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No good news
Powell's testimony suggests higher cap requirements not ruled out
There was little good news for financial markets during the first of Chairman Powell’s two day testimony before the Senate Finance Committee (March 6 and 7), but US banks will have been particularly perturbed to learn that additional capital requirements may be forthcoming.
Powell did not distance himself from the comments made last December by Vice Chair for Supervision Michael Barr to .......
News 7 March 2023
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'Conflict of interest' undermines CRT
Lawyers ring alarm bells about possible impact of SEC ruling on CRT market
The US regulatory capital relief trade market appears in grave danger from the controversial “conflict of interest” re-proposal and release made by the Securities and Exchange Commission (SEC) at the end of January, say lawyers.
The language in the proposing release “raises significant concerns” about whether SPE CRT deals are classified as “conflicted transactions” under the rules, says Mayer Brown in .......
News 6 March 2023
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BREP default an 'inflection point'?
Sector developments and company hires
BREP default an ‘inflection point’?
A senior loan EOD has occurred in connection with Finnish single-loan CMBS FROSN-2018, after Blackstone Real Estate Partners failed to repay the loan on 1 March (SCI ABS Markets Daily - 2 March). The episode marks one of the first high-profile securitisation defaults of the current cycle.The FROSN-2018 loan had been granted .......
Market Moves 6 March 2023
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SCI Start the Week - 6 March
A review of SCI's latest content
Inaugural SRTx fixings released
News 6 March 2023
The inaugural fixings for the SRTx (Significant Risk Transfer Index) have been released. The index values suggest that pricing volatility is rising and credit risk is worsening for US capital relief trades at a higher level than for European CRTs. For further information on SRTx or to register your interest as a contributor to the .......
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Banks seek CRT clarity
"Reservation of authority" at heart of regulator distaste for CRT, say sources
A top tier US bank has requested a non-objection letter from the Federal Reserve Bank of New York to clarify its attitude to regulatory capital relief trades and the 60-day period allowed for a reply is due to expire in the next few weeks, say well-placed industry sources.
The identity of the bank is not known but it is thought to be .......
News 4 March 2023
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SRTx inaugural fixings released
Index values project worsening conditions for CRTs
The inaugural fixings for the SRTx (Significant Risk Transfer Index) have been released. The index values suggest that pricing volatility is rising and credit risk is worsening for US capital relief trades at a higher level than for European CRTs.
Overall, both pricing volatility and SRT execution conditions are shown to be skewing higher for SME transactions in .......
News 3 March 2023
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Supreme Court grants CFPB petition
Sector developments and company hires
Supreme Court grants CFPB petition
Market Moves 3 March 2023
The US Supreme Court has granted the CFPB’s Petition for a Writ of Certiorari in the case of ‘CFPB v. Community Financial Services Association of America’ and denied the cross-petition filed by Community Financial Services Association of America (CFSAA). The CFPB’s petition asked the court to overturn the 19 October 2022 ruling by the US .......
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Window of opportunity
German auto ABS dominates primary issuance
After the first European ABS deal of the year – Dutch Property Finance 2023-1 - printed on 25 January, a flurry of paper has hit the primary market as issuers sought to capitalise on strong market conditions. Auto ABS has dominated activity, with German lenders leading the way.
“It’s mainly issuers capitalising on the strong market conditions before .......
News Analysis 2 March 2023
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SCI In Conversation podcast: Keerthi Raghavan, Waterfall Asset Management
We discuss the hottest topics in securitisation today...
In this episode of the SCI In Conversation podcast, Waterfall Asset Management partner Keerthi Raghavan discusses the headwinds and tailwinds currently facing the US ABS market. In a bonus feature marking International Women’s Day on 8 March, we also chat to Linklaters managing associate Ruhi Patil about what this year’s campaign theme - ‘embrace equity’ - means to .......
News 2 March 2023
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Confidence and convenience
Brian Bejile, founder and ceo of Octaura Holdings, answers SCI's questions
Q: After launching the platform last year, Octaura reported the completion of its first fully electronic syndicated loan trade last month (SCI 2 February). What has Octaura been working on since then?
Provider Profile 1 March 2023
A: Since we launched last June, we have covered a lot of ground. We have spent a lot of time recruiting and bringing people into the ranks, .......
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Back to STACR
Freddie targets 70/30 bonds versus reinsurance split as supply drops
Freddie Mac expects to issue between $4.5bn and $6.5bn in the CRT space in 2023, and it targets a 70/30 split between the capital markets and the reinsurance market, says a spokesman for the GSE at the SFA conference in Las Vegas today (February 28).
This is around a third of the supply seen in 2022, which was a record year.
A 70/30 .......
News 1 March 2023
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Direct lending platform unveiled
Sector developments and company hires
Direct lending platform unveiled
Oaktree Capital Management has launched private credit-focused Oaktree Lending Partners (OLP) and its related vehicles. OLP is targeting US$10bn in equity commitments from institutional investors and will seek to originate senior secured loans of US$500m or more to private equity-owned US companies, typically with over US$100m in EBITDA.Oaktree believes this market is especially attractive .......
Market Moves 28 February 2023