Complete news archive
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Asset managers partner on pensions initiative
Sector developments and company hires
Asset managers partner on pensions initiative
DWS has launched the DWS Secured Income Fund, aimed at small to medium-sized defined benefit pension plans seeking stable, long-term returns. The fund provides a diversified portfolio of secured income assets, including ABS and CLO bonds.Over half of UK defined benefit pension plans are in deficit, with insufficient assets to meet their .......
Market Moves 13 May 2021
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Demand drivers
Fundamentals and technicals support US CLOs for now
On the back of the exceptionally heavy supply in Q1, US CLO spreads softened, but had reversed back to one-year tights at the end of last week. The move was driven by continuing voracious investor demand, unlikely to be diminished even by expected record primary issuance, unless macro events intervene.
“Most people still see CLOs as pretty good .......
News Analysis 13 May 2021
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Bad weather bonds
Utilities to make use of ABS to rebuild after extreme weather
This year has already seen two utility recovery charge (URC) ABS transactions in the US and, say analysts, more will be priced as extreme weather becomes more common – which some climate modellers predict.
“We’ve seen two so far this year and there is rumbling of more to come due to legislation already in place, as well as .......
News Analysis 12 May 2021
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Iberian RMBS investment disclosed
Sector developments and company hires
Iberian RMBS investment disclosed
Market Moves 12 May 2021
The EIB has disclosed that it invested €50m in UCI’s latest RMBS, Prado VIII, aimed at promoting the renovation of existing residential buildings in Spain and Portugal, as well as the purchase of new near zero energy housing. The project is expected to contribute to climate change mitigation, delivering energy savings of almost 57GWh a year .......
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STS BTL RMBS prepped
Sector developments and company hires
STS BTL RMBS prepped
Domivest is in the market with the first-ever STS buy-to-let RMBS. Dubbed Domi 2021-1, the €352.2m transaction is backed by a €370.7m provisional pool of Dutch BTL mortgage loans, including €30.61m in prefunding.Interest-only loans comprise 93.5% of the pool, according to Moody’s. Loans with initial LTVs above 70% amortise linearly to either the 70% .......
Market Moves 11 May 2021
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Geographical divergence
CSEE moratoria more likely to underperform
EU banks set aside large provisions in 2020 in anticipation of Covid-induced higher default rates, but most loans that benefited from payment holidays in the region resumed regular payment schedules during 2020 with less than expected difficulty. However, the credit performance of loans exiting moratoria weakened in the last quarter of the year, indicating that loans under long-running moratoria .......
News Analysis 11 May 2021
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Risk transfer round-up - 11 May
CRT sector developments and deal news
Bank of Montreal has called Muskoka Series 2020-1. The US$132m financial guarantee was executed in April 2020, becoming the first post-Covid capital relief trade (SCI 15 May 2020). The lender exercised another call option on 9 February for Muskoka Series 2017-2 (SCI 9 February).
....... News 11 May 2021
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Hertz reorganisation proposals weighed
Sector developments and company hires
Hertz reorganisation proposals weighed
Market Moves 10 May 2021
Hertz has determined that a revised proposal to provide equity capital to fund its exit from Chapter 11 - made by affiliates of Knighthead Capital Management, Certares Opportunities and Apollo Capital Management - constitutes a superior proposal than the one contemplated by its agreement with its existing plan sponsors, affiliates of Centerbridge Capital Partners, Warburg Pincus .......
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CRE CLO surge
Record issuance expected
The US CRE CLO market is seeing a surge in new issuance, albeit from the sector’s relatively low levels. The 18 deals priced so far this year have already surpassed last year’s total of 11 and are well on the way to reaching 2019’s all-time record of 29, with total volume expected to surpass the US$15bn achieved then.
Bank of .......
News Analysis 10 May 2021
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SCI Start the Week - 10 May
A review of securitisation activity over the past seven days
Last week's stories
News 10 May 2021
Niche exposure
CFE Finance answers SCI's questions
NPL rebound?
Secured loan sales set for 2022 return
Tight pricing
Standard Chartered prints CRT
Alternative support
Infrastructure ABS boosts Italian direct lending
Further details have emerged regarding the debut syndication of an Italian infrastructure loan via a securitisation vehicle (SCI 4 May). The transaction was undertaken with aim of enabling alternative lenders to .......
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Alternative support
Infrastructure ABS boosts Italian direct lending
Further details have emerged regarding the debut syndication of an Italian infrastructure loan via a securitisation vehicle (SCI 4 May). The transaction was undertaken with aim of enabling alternative lenders to access the Italian credit market.
“The objective of the deal was to syndicate both drawn and undrawn loan commitments to non-banking institutions that were not licensed .......
News 7 May 2021
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Green railcar ABS debuts
Sector developments and company hires
Green railcar ABS debuts
Trinity Industries has priced its inaugural green railcar ABS, following the publication of its green financing framework in January. The US$355m TRP Series 2021-1 transaction is backed by a US$482.68m portfolio comprising 6,350 railcars.The notes constitute green bonds based on the generally accepted market principles for such classification published by ICMA. Sustainalytics, acting as an external .......
Market Moves 7 May 2021
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Niche exposure
CFE Finance business development manager Duccio Duranti and...
Q: How and when did CFE Finance become involved in the securitisation market?
The Structured Credit Interview 7 May 2021
DD: CFE Finance was founded by Mario Cordoni in 2001 to support the trade of commercial transactions both to and from emerging markets, including pre-export finance and export credit agency (ECA) financing. As a metals trader, Mario often faced credit risk exposure when dealing with emerging market .......
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Landmark Romanian CRT upgraded
Sector developments and company hires
Landmark Romanian CRT upgraded
Market Moves 6 May 2021
Scope Ratings has upgraded to single-A from single-A minus the two tranches issued under the SME Initiative Uncapped Guarantee Instruments (SIUGI) for Romania deal (SCI 5 May 2020), an EIF risk transfer transaction referencing 60% of a €1.369bn portfolio – which is still ramping up – of SME credit rights originated by eight Romanian banks. .......
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NPL rebound?
Secured loan sales set for 2022 return
European secured loan sales witnessed their sharpest contraction last year as the coronavirus pandemic rocked markets. Nevertheless, a broad-based rebound is anticipated for the non-performing loan market in 2022.
According to the latest CBRE data, the market just saw €40.4bn of European secured loan volumes in 2020. The total represents a marked decrease from the €162bn record .......
News 6 May 2021
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US CLOs assessed
Sector developments and company hires
US CLOs assessed
As US CLO primary volumes continue to fall, JPMorgan CLO research has taken stock of the market’s current standing. It finds the US$1trn benchmark is edging within sight, despite a deceleration in the number of new managers, and strong risk/reward credentials keeping the CLO space attractive.JPMorgan reports that global CLO market outstanding notional is currently .......
Market Moves 5 May 2021
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Tight pricing
Standard Chartered prints CRT
Standard Chartered has finalised a US$180m CLN that references a US$2bn portfolio of around 130 US and European corporate exposures. Dubbed Chakra Five, the capital relief trade is the most tightly priced Chakra deal to date.
The trade printed in the high single-digits and features tranches that amortise sequentially over a an approximately three-year weighted average life and .......
News 5 May 2021
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Hong Kong ILS pilot unveiled
Sector developments and company hires
Hong Kong ILS pilot unveiled
Market Moves 4 May 2021
The Hong Kong Insurance Authority has released details of the two-year Pilot Insurance-linked Securities Grant Scheme promulgated in the jurisdiction’s 2021-2022 Budget. The scheme provides an incentive for onshore and offshore issuers and sponsors to issue ILS in Hong Kong, while efforts are being made in parallel to map out a new regulatory regime for .......
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RFC issued on LGD proposal
Sector developments and company hires
RFC issued on LGD proposal
Market Moves 30 April 2021
The EBA has published a consultation paper on draft Regulatory Technical Standards specifying the types of factors to be considered when assessing the appropriateness of risk weights and minimum loss given default (LGD) values for exposures secured by immovable property. Relevant authorities, as designated by a Member State, may set higher risk weights or impose .......
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Balancing act
Alexander Batchvarov, md, head of international structured f...
Q: How would you describe European investor appetite for esoteric securitisations currently?
A: We have a situation on the market, where corporate spreads are moving very tight and at present high yield spreads are in the 300bp area in Europe. Investors seek beta, but also keep an eye over their shoulders – ECB reaction function is of concern.With .......
Talking Point 30 April 2021