CMBS
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Dual-currency deal
Pan-European CMBS prepped
Goldman Sachs is in the market with a dual-currency pan-European CMBS. Dubbed Frost CMBS 2021-1, the transaction securitises a £112.35m loan and a €92m loan advanced to Newcold Holdings, a temperature-controlled logistics company based in the Netherlands.
The sterling-denominated loan is secured by a single cold-storage property in Wakefield, Yorkshire. The euro-denominated loan is secured against one cold-storage .......
News 3 November 2021
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SLM EODs eyed
Sector developments and company hires
Fitch has downgraded from single-B to double-C the outstanding class A4 and B notes of SLM Student Loan Trust 2007-7, 2008-1 and 2008-4, due to the legal final maturity date of the class A4 notes being approximately three months away in January 2022 for SLM 2007-7 and 2008-1 and less than 10 months .......
Market Moves 2 November 2021
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Matryoshka doll?
Use of proceeds proving contentious for ESG securitisations
The EU taxonomy regulation and Sustainable Finance Disclosure Regulation (SFDR) are posing challenges for securitisation issuers and investors. For now, use of proceeds remains the most contentious issue.
Announced in late 2019, the European Green Deal reflects the EU’s ambitious bid to lead the world on climate action. The deal’s commitments became legally binding by the entry into .......
News Analysis 1 November 2021
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Securitisation stamp duty eyed
Sector developments and company hires
Securitisation stamp duty eyed
Market Moves 29 October 2021
The UK government is introducing legislation within Finance Bill 2021-22 that provides a power to make stamp duty and stamp duty reserve tax (SDRT) changes relating to securitisations and ILS by secondary legislation. The power will be a freestanding provision and will allow HM Treasury to make regulations to provide that stamp duty or SDRT is .......
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Still strong
European ABS/MBS market update
In a quieter week than of late, two full capital stack deals have been competing for investor attention in the European ABS/MBS primary market. Strong demand for both Pixel 2021 and SC Germany Consumer 2021-1 suggests that the market is still strong.
“I think both deals have been executed very well,” notes one ABS/MBS trader. “For SC Germany Consumer .......
News 28 October 2021
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New banking rules
Sector developments and company hires
The European Commission has adopted new EU banking rules under CRR 3 and CRD 4, with the aim of ensuring that EU banks become more resilient to potential future economic shocks, while contributing to Europe's recovery from the Covid-19 pandemic and the transition to climate neutrality. The Commission notes that while the overall level of capital .......
Market Moves 28 October 2021
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Covid dip
CRE CLO churn rates drop
Churn rates in US managed CRE CLOs continue to decline, according to new research from KBRA assessing collateral turnover in recent vintage transactions. The study analysed all CRE CLO transactions issued between 2017 and 2020, gathering data on US$23.3bn in issuance across a total of 27 transactions. Most of these transactions had reinvestment periods of 24 months (51.4%) or .......
News 28 October 2021
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Highland Capital lawsuit filed
Sector developments and company hires
Highland Capital lawsuit filed
Market Moves 25 October 2021
The latest lawsuit brought by Highland Capital Management (HCMLP) against former employees has been filed in the bankruptcy court of the northern district of Texas. The action seeks to “recover hundreds of millions of dollars in damages that HCMLP suffered at the hands of its founder, James Dondero, acting in concert with other entities that he owned .......
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Gallatin CLO platform acquired
Sector developments and company hires
Gallatin CLO platform acquired
Aquarian Holdings has launched Aquarian Credit Partners (ACP), a syndicated high-yield credit investment management platform. Aquarian has partnered with Justin Driscoll, Bo Williams and the rest of the Gallatin Loan Management team to form ACP, which has assumed management of Gallatin’s existing CLOs, with more than US$800m of assets under management.Gallatin has a track .......
Market Moves 22 October 2021
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Pockets of resilience
European ABS/MBS market update
European ABS/MBS spreads leaked slightly wider and investor demand cooled somewhat last week as the market finally caught up with broader macro volatility. However, some sectors continue to outperform and this week is off to a strong start with a broad range of deals in the primary pipeline to follow.
“Indisputably, on a macro level, the same concerns .......
News 20 October 2021
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Big bang?
Tokenisation touted as a replacement for securitisation
Tokenisation is being touted as a potential replacement for securitisation, given its many applications and benefits. However, a number of challenges remain before the technology can be fully adopted by the market.
News Analysis 14 October 2021
“Tokenisation could replace securitisation – but it won’t be a big bang. However, when you see the speed of digitisation in some areas, you see it has the .......
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Transitional financing
Adam Zausmer, chief credit officer at Ready Capital, answers SCI's questions
Q: Why do you feel the US CRE CLO sector is booming?
The Structured Credit Interview 14 October 2021
A: The bridge lending market is certainly red hot at the moment. We tend to focus on less volatile assets, like multifamily, and clear trends we see across the US are tired properties in need of capital expenditure as well as a shortage of quality affordable housing. Non-bank .......
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Chopra on the march
CFPB to expand its role and come down harder on securitisation
The securtisation market will see a more aggressive CFPB under the leadership of recently appointed director Rohit Chopra, with “more frequent enforcements and bigger fines,” according to Rachel Rodman, a partner with Cadwalader, Wickersham and Taft.
Rodman was speaking yesterday (5 October) at the annual SFA conference in Las Vegas on a panel addressing the future of housing .......
News 6 October 2021
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What is the future for US office space?
Steve Jellinek, head of CMBS research at DBRS Morningstar, e...
On a national level, the US office market is likely to see a rebound from the coronavirus pandemic-induced recession, even as net absorption has underperformed and construction remains elevated. The amount of sub-leasable space continues to shrink, declines in vacancy were seen in some major metropolitan areas in 2Q21, and office-using employment continues to grow amid the reopening economy.
Talking Point 5 October 2021
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CIFC, TRS launch leveraged loan partnership
Sector developments and company hires
CIFC, TRS launch leveraged loan partnership
Market Moves 4 October 2021
Teacher Retirement System of Texas (TRS) and CIFC Asset Management have established a new leveraged loan investment fund platform known as Texas Debt Capital (TDC). A CIFC affiliate is the general partner and investment manager of TDC, while TRS is the anchor investor limited partner and has committed significant equity to the fund. The .......
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Dual-currency debut
Rare European CRE CLO prepped
Starz Realty Capital has mandated leads for a rare European dual-currency static CRE CLO named Starz Mortgage Securities 2021-1 (see SCI’s Euro ABS/MBS Deal Tracker). The transaction has no reinvestment ability but allows the issuer to modify performing loans, as well as sell credit risk and defaulted assets, and it also features note protection tests.
The transaction .......
News 1 October 2021
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Synthetic Libor settings confirmed
Sector developments and company hires
Synthetic Libor settings confirmed
Market Moves 29 September 2021
The UK FCA has confirmed that to avoid disruption to legacy contracts that reference the one-, three- and six-month sterling and Japanese yen Libor settings, it will require ICE Benchmark Administration to publish these settings under a 'synthetic' methodology, based on term risk-free rates, for the duration of 2022. However, these six Libor settings will be .......
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Fraud charges for Honor Finance pair
Sector developments and company hires
Fraud charges for Honor Finance pair
Market Moves 24 September 2021
The US SEC has announced fraud charges against James Collins and Robert DiMeo, the former principals of Honor Finance, for misleading investors about the subprime automobile loans that backed its US$100m offering. The SEC's complaint, filed in US District Court for the Northern District of Illinois, alleges that the pair were responsible for false .......
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Excellent shape
European ABS/MBS market update
September is living up to its reputation as a busy month for the European ABS/MBS primary market. Even though four deals are due to price today and tomorrow and three printed yesterday spreads remain tight and demand is still strong.
“It’s pleasing to see that the primary ABS market is in excellent shape,” notes one trader. “Although there is an .......
News 23 September 2021
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US CLOs, Trups CDOs under observation
Sector developments and company hires
US CLOs, Trups CDOs under observation
Market Moves 22 September 2021
Fitch has placed 102 tranches issued by 43 US CLOs and 13 tranches issued by seven Trups CDOs under criteria observation (UCO), following the publication of its CLO and corporate CDO rating criteria last week (SCI 17 September). The agency intends to resolve the UCO status by applying the updated criteria to each .......