CLOs
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DLT powers bank subordinated debt deal
Sector developments and company hires
DLT powers bank subordinated debt deal
Market Moves 12 August 2022
Blockchain-powered fixed income platform Brightvine and Angel Oak Capital Advisors have launched what is believed to be the first-ever bank subordinated debt issuance leveraging blockchain technology. A US$147.55m securitisation backed by subordinated debt issued by community banks across the US, BFNS 2022-1 leverages Brightvine Portal, a secure management platform for conducting primary offerings of .......
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Angel Oak censured for fix-and-flip RMBS
Sector developments and company hires
The US SEC has charged Angel Oak Capital Advisors and its portfolio manager Ashish Negandhi for misleading investors about the firm’s fix-and-flip loan securitisation’s delinquency rates. Angel Oak and Negandhi have agreed to pay a penalty of US$1.75m and US$75,000 respectively.
According to the SEC’s order, in March 2018, Angel Oak raised US$90m through a securitisation backed by loans to .......
Market Moves 11 August 2022
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RFC issued on SES proposals
Sector developments and company hires
The EBA has launched a public consultation on its draft regulatory technical standards (RTS) on the determination by originator institutions of the exposure value of synthetic excess spread (SES) in securitisations. The aim of the proposals is to contribute to a more risk-sensitive prudential framework in the area of synthetic securitisation.
The capital markets recovery package (CMRP) set out a .......
Market Moves 9 August 2022
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London Bridge broadens ILS capabilities
Sector developments and company hires
Lloyd’s has received regulatory approval from the UK PRA and FCA to set up a second Protected Cell Company (PCC), which provides a broadened range of ILS-related capabilities and enhanced accessibility for investors. Following the success of London Bridge Risk PCC (LBR) (SCI 10 February 2021), the new Lloyd’s vehicle is called London Bridge PCC (LB2) and will enable .......
Market Moves 5 August 2022
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Voya to acquire Czech Asset Management
Sector developments and company hires
Voya Investment Management has signed a definitive agreement to acquire private credit asset manager dedicated to the US middle market, Czech Asset Management (CAM). The transaction reflects Voya IM’s commitment to the expansion of its private and alternative credit capabilities, and the firm hopes the acquisition will complement its existing fixed income platform and boost the expansion of its private .......
Market Moves 4 August 2022
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Germany's auxmoney secures €500m funding
Sector developments and company hires
The German digital-lending platform auxmoney has secured a further €500m in funding for investment into consumer loans on its platform from Citi and Natixis’ ABCP conduit. The digital-lending platform has been supported by investment from Citi since 2021, with this latest funding from the two large financial institutions expected to be used for the origination of new loans. The firm .......
Market Moves 3 August 2022
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NPL Markets reveals new partnership agreement
Sector developments and company hires
NPL Markets has announced a new partnership agreement with World Bank Group member, International Finance Corporation (IFC). The collaboration seeks to develop a greater and more efficient marketplace in South America to manage and trade performing loans, distressed, as well as other illiquid assets. Initially, the partnership will target the large markets of Brazil and Mexico, with hopes to explore .......
Market Moves 2 August 2022
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RFC issued on homogeneity RTS
Sector developments and company hires
The EBA has launched a public consultation on draft regulatory technical standards (RTS) specifying the criteria for the underlying exposures in securitisation to be deemed homogeneous, in line with requirements under the Securitisation Regulation and as amended by the Capital Markets Recovery Package (CMRP). The homogeneity requirement aims to facilitate the assessment of underlying risks in a pool of underlying .......
Market Moves 29 July 2022
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Securitised products business under review
Sector developments and company hires
During its 2Q22 financial results presentation yesterday, Credit Suisse disclosed that it has been conducting a strategic review of the bank's businesses, with the goal of creating “a more focused, agile group with a significant, lower absolute cost base”. As part of this review, the bank is assessing strategic options for its securitised products business, including accelerating growth and strengthening .......
Market Moves 28 July 2022
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'Penalising' RBC proposal criticised
Sector developments and company hires
‘Penalising’ RBC proposal criticised
Market Moves 21 July 2022
The LSTA has submitted a comment letter to the NAIC expressing its belief that the NAIC’s risk-based capital (RBC) proposal could penalise insurance company investments in CLOs and consequently impact the CLO and loan markets. The proposal would change the RBC framework such that capital requirements for purchasing all tranches of a CLO match the capital .......
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ICE launches ESG Geo-Analyzer
Sector developments and company hires
Intercontinental Exchange (ICE) has launched its ICE ESG Geo-Analyzer tool to better help analyse portfolios of both commercial and residential properties, asset-backed securities, and corporate operations that are tied to certain locations. The Geo-Analyzer tool uses ICE’s geospatial data modelling to create climate risk and social impact data and analytics for properties and communities across the US. It seeks to .......
Market Moves 19 July 2022
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Digital revolution?
Claira co-founder, Eric Chang, and co-founder and advisor, Joe Squeri, answer SCI's questions
Q: Claira, the document intelligence fintech, recently announced its collaboration with Citi to help boost digital transformation within securitisation and develop next-generation data analysis solutions for CLOs (SCI 29 June). Tell us more about your vision for the company.
Provider Profile 19 July 2022
JS: The digitisation of structured credit documents has been something I’ve been trying to solve my entire career, and I’ve .......
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Administrative burden
CLOs caught in disclosure crosshairs
US CLO managers are facing potential disruption from new disclosure requirements proposed by the US SEC in February. The proposed new rules under the Investment Act of 1940 would require registered investment advisors to private funds - including CLO managers - to adhere to new reporting, record-keeping and disclosure requirements.
The proposal’s comment period was extended from the original 30 .......
News Analysis 15 July 2022
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ABS CDO manager replaced
Sector developments and company hires
Dock Street Capital Management has replaced Dynamic Credit Partners (as successor to Petra Capital Management, the original manager of the deal) as collateral manager for the Brookville CDO I transaction. Moody’s has confirmed that the move will not result in any adverse rating actions with respect to the notes issued by the transaction.
In other news…
EMEA
DLA Piper expands .......
Market Moves 15 July 2022
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GSE NPL sales tallied
Sector developments and company hires
Fannie Mae and Freddie Mac sold 154,972 non-performing loans with a total unpaid principal balance (UPB) of US$28.7bn during the period from programme inception in 2014 through 31 December 2021, according to the FHFA. The loans had an average UPB of US$185,292, an average delinquency of 2.8 years and an average current mark-to-market LTV ratio of 86%.
Specifically, Fannie Mae has .......
Market Moves 13 July 2022
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Call for proportionality in ABS framework
Sector developments and company hires
AFME ceo Adam Farkas has written to the European Commission, calling for better proportionality in the securitisation framework. The letter points out that despite its importance for the Capital Markets Union project, the European ABS market remains “subdued”, its size having shrunk from 75% that of the US securitisation market in 2008 to just 6% in 2020.
The letter highlights .......
Market Moves 12 July 2022
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Uncertainty prevails
Macroeconomic backdrop in focus
Thus far, 2022 has experienced some turbulent and choppy market conditions. Although poor performance has not yet affected the securitisation sector, the consensus – at least, in evidence during AFME and IMN’s Global ABS conference last month – is that uncertainty prevails and investor sentiment is predominantly focused on the macroeconomic backdrop.
During this period of market dislocation, .......
Talking Point 12 July 2022
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Aviva Investors appoints HSBC and Mount Street Group
Sector developments and company hires
HSBC and Mount Street have entered into a ten-year strategic agreement to service Aviva Investors’ £50bn Real Assets business. The firms’ appointment will see them assuming responsibility for all fund administration and debt servicing functions for Aviva Investors’ Real Assets strategies. HSBC and Mount Street were appointed following competitive process due to depth of offering, expertise across real assets credit .......
Market Moves 11 July 2022
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Arrow Global hires new leader for Finance Servicing Unit
Sector developments and company hires
Arrow Global has appointed Reza Atighi as new ceo to its Amersfoort-based Vesting Finance Servicing in the Netherlands. Atighi joins Vesting Finance from Intrum where he served most recently as ceo for the Netherlands and Belgium. Bringing more than 20 years of experience to the new role, the firm hopes Atighi will be able to boost the development of its .......
Market Moves 7 July 2022
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A&M move forward with new development
Sector developments and company hires
Alvarez & Marsal’s (A&M) inaugural efforts as sole arranger have secured a breakthrough for Polish bank, Getin Noble Bank (GNB). A&M financial services served as sole arranger for GNB’s first synthetic securitisation for risk transfer. The transaction compiles a portfolio of housing community loans and marks the first of its kind for the historically well performing but never-before-securitised asset class. .......
Market Moves 6 July 2022
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What is the future of the CRE market?
Despite the fluctuations in the capital markets this year, European warehouse funding for granular, small and medium balance commercial real estate mortgage loans remains stable, explains Sabah Nawaz, partner, Cadwalader, Wickersham & Taft LLP.
This is particularly the case in the “loan on loan” warehouse space. “Loan on loan” funding typically involves an institutional lender advancing loans to a SPV .......
Talking Point 5 July 2022