Complete news archive
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Bank bonanza
Massive potential of US bank CRT market stressed in Miami
If 10% of the $2trn US wholesale commercial loan market were to receive the CRT treatment it would create $25bn of new tranches - only $10bn less than the entire current global CRT market, according to a speaker at the ABS East conference in Miami today.
Moreover, there remains considerable incentive for US banks to take this path: the differential between RWAs .......
News 14 December 2021
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CyCAC securitisation closed
Sector developments and company hires
CyCAC securitisation closed
Oxalis Holdings has completed a securitisation backed by a portfolio of Cypriot non-performing loans (NPLs) and real estate owned (REO) properties (see SCI’s Euro ABS/MBS Deal Tracker). Dubbed Hestia Financing, the €2.2bn transaction implements a two-tier structure for the management of the portfolio.The portfolio has a total adjusted pool value of €2.06bn and was .......
Market Moves 14 December 2021
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UK review released
HMT 'broadly supportive' of securitisation market
The UK government has published its report on the review of the securitisation regulation (SCI 28 June), which outlines specific areas of the regime that HM Treasury may revisit to ensure it “best delivers” for the UK securitisation market. The report appears to be broadly supportive of the industry - although notably isn’t supportive of extending the public .......
News 14 December 2021
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Legal fees
Litigation finance market ripe for securitization wizards
Dislocation and delays of normal procedure during the 21 months of Covid 19 have boosted the litigation finance maket and with it the possibility of greater securitization, says Jordan Goldstein, partner at Selendy & Gay in New York
Goldstein was speaking today about new trends in structuring and underwriting at the ABS East conference in Miami.
Lenders in the litigation finance market advance .......
News 14 December 2021
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Road rage
Soaring used car prices turbo charge auto ABS but risks loom, say Miami panellists
An unprecedented surge in US used car values has led to a remarkable recovery in the auto ABS market from the pandemic lows, agreed panellists today at the ABS East conference in Miami.
Spreads have narrowed from an average of Libor plus 300bp-350bp at the beginning of Q2 2020 to something in the region of plus 150bp at the end of 2021, .......
News 13 December 2021
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Game-changing potential
In the second in our series of year-end interviews with inve...
Opportunities for investment in CRT trades from US names will increase significantly in 2022, says Terry Lanson, a portfolio manager at Seer Capital.
“We think we’ll see significant volume out of the US and also out of Europe. The programme is growing in adoption globally. It is receiving significant attention from investors and capital allocators like state pension .......
News Analysis 13 December 2021
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NPL prudential framework revised
Sector developments and company hires
NPL prudential framework revised
Market Moves 13 December 2021
The EBA has published its final report on the draft regulatory technical standards (RTS) amending its RTS on credit risk adjustments in the context of the calculation of the risk weight (RW) of defaulted exposures under the standardised approach (SA) of credit risk. The proposed amendments follow up on the European Commissions’ action plan to tackle .......
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SCI Start the Week - 13 December
A review of SCI's latest content
Last week's news and analysis
News 13 December 2021
Covid-19: Lessons for the CMBS market
Allen & Overy explores the pandemic lessons for European CMBS
CRT bonanza
Record 2021 origination and Fannie's return to drive banner 2022 for CRT
Digital ABS debuts
Fully blockchain-based securitisation completed
Exploiting inefficiencies
CIFC answers SCI's questions
Flowers among weeds
CMBS yields value to canny buyers despite distress
Growth constraints
Disconnect between Euro ABS ambitions and .......
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Record breakers
Strong Euro CLO market set to continue
European CLO issuance volume is set to hit a post-financial crisis high of €40bn by year-end, boosted by record reset and refinancing activity. Prospects for the market in 2022 remain positive, reflecting strong leveraged debt issuance expectations, improving CLO arbitrage and a positive macroeconomic outlook.
“It’s been a very busy market – even if there has been a .......
News 10 December 2021
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Year-end?
European ABS/MBS market update
With primary European ABS/MBS market activity fading further away, year-end feels awfully close. As a result, focus is already being directed on the upcoming new year.
“I think it is fair to say that we have hardly looked at any potential trades this week,” says one European ABS/MBS trader. “As is appropriate for this time of year, there .......
News 10 December 2021
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HSBC hits the US trail
HSBC USA markets corporate loan CRT, Santander brings auto loan CLN
HSBC USA is in the CRT market with a new trade backed by large revolving corporate loans originated in North America, say well-placed sources.
The deal, which is expected to close before the end of the year, is self-led.
The reference pool of loans is worth $2.5bn and the new issue size will be $300m, add sources.
Tranche thickness is 0%-12.5% and the trade .......
News 9 December 2021
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Climate risk analytics firms acquired
Sector developments and company hires
Climate risk analytics firms acquired
Intercontinental Exchange has acquired risQ and Level 11 Analytics, which deploy data-driven technologies for managing climate change risk. RisQ and Level 11 Analytics leverage a variety of advanced geospatial mapping systems and provide extensive expertise in analysing and joining vast amounts of disparate public, corporate and third-party data sources.This data is integrated and .......
Market Moves 9 December 2021
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Starz gazing
Euro CRE CLOs tipped for take-off
Starz Realty Capital’s Starz Mortgage Securities 2021-1 transaction was notable for being a first-of-its-kind European dual-currency CRE CLO (SCI 1 October). A handful of further such deals are expected next year, given the need for a funding tool for funds active in the CRE lending space.
“I expect a handful of transactions next year – at least .......
News Analysis 9 December 2021
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SME boost
German STS synthetic printed
Deutsche Bank and the EIB Group have executed a €75m unfunded mezzanine guarantee that references a €1bn German mid-market corporate portfolio. The guarantee will provide capital relief to Deutsche Bank and enable the lender to finance €300m of SME and mid-cap lending. The transaction is expected to support smaller businesses in their recovery from liquidity shortages caused by the .......
News 9 December 2021
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Growth constraints
Disconnect between Euro ABS ambitions and reality?
European securitisation issuance for the first 11 months of the year stood at a decade high of over €112bn, up by more than 65% compared with the same period in 2020, according to S&P figures. However, despite such record growth, a disconnect appears to remain between the industry’s ambitions and what is being seen on the ground - which .......
News Analysis 9 December 2021
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Perfect harmonisation?
Transparency and standardisation key to EU NPL initiatives
Although fears of a Covid-induced wave - or a tsunami even - of European non-performing loans (NPLs) has dissipated for now, caution and vigilance still appear to dominate the sector. A regulatory approach towards increased transparency and harmonisation of the secondary market for NPL transactions should, however, facilitate more efficiency across the sector.
“The European Commission has tried .......
News Analysis 9 December 2021
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Flowers among weeds
CMBS yields value to canny buyers despite distress
In the first of a series of interviews with SCI, investment managers discuss where they have seen most value recently and where they expect to see it in 2022.
Despite - or because of - the continued uncertainties that beset many areas of the CMBS market, this is the sector of the structured finance marker that currently offers the best returns to .......
Talking Point 8 December 2021
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CRT bonanza
Record 2021 origination and Fannie's return to drive banner 2022 for CRT
Next year will see record GSE CRT issuance of around $20bn, around $6bn higher than 2021, predicts Pratik Gupta, head of CLO and RMBS research at Bank of America.
In addition, he predicts a resurgence of interest in CRT issuance from mortgage insurers seeking to lay off risk and suggests that there could be as much as $10bn of supply in this .......
News 8 December 2021
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New STACR, last STACR
Freddie prices 10th and final STACR of the year
Freddie Mac has priced a $963m STACR, making its third CRT transaction of Q4 and final offering of the year.
The trade, designated STACR 2021-HQA4, was underwritten by joint leads Barclays and Bank of America. The co -managers were Amherst Pierpoint, Morgan Stanley, Nomura and StoneX Financial.
It comprises four tranches, an M-1, M-2, B-1 and B-2. The $445m M-1 was priced to .......
News 8 December 2021