Investors
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Investor reassurance
Spanish Supreme Court ruling assuages NPL ABS investor concerns
Spain’s Supreme Court has ruled that Spanish banks are obliged to wait until at least 12 monthly instalments are missed before initiating foreclosure proceedings on consumer mortgage contracts. The ruling should reassure investors in non-performing loan (NPL) securitisations by allowing lenders to foreclose on troubled home loans.
The guidance concerns procedures which have been lingering after early-termination clauses were declared .......
News Analysis 20 September 2019
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Legacy SRT call possibility
Regulatory triggers could lead to SRTs being called next year
Banks could potentially call legacy capital relief trades (CRTs) next year, as higher senior risk weights for these deals kick, following the end of a one-year grandfathering period. Higher senior risk weights could render the deals less efficient and justify calling and restructuring a transaction, but whether calls are exercised or not will depend on what counts as a .......
News Analysis 20 September 2019
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Case for STS synthetics outlined
Benefits of STS on synthetics clear, but objections could be raised
The EBA is set to release its discussion paper on the application of the STS label to synthetic securitisation next week, with a view to publishing a proposal by the middle of next year. While the paper is a “step in the right direction”, the market will not see any synthetic securitisations with the STS label for “quite some .......
News Analysis 20 September 2019
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Risk transfer round-up - 20 September
CRT sector developments and deal news
Standard Chartered is rumoured to be prepping a corporate capital relief trade for 4Q19. The bank’s last risk transfer trades were completed last summer and referenced corporate loans. The first one was dubbed Chakra 3 and was inked in June, while the second one was called Gongga and was completed in July (see SCI’s capital relief trades database).
...... News 20 September 2019Premium Content
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Credit-granting guidance outlined
"Bright-line" verification test still absent
The EBA recently published an answer to a question posed by AFME in relation to Article 9(3) of the Securitisation Regulation, pertaining to credit-granting criteria for exposures in a securitisation. While the answer provides some guidance on how those issuing securitisations may satisfy Article 9(3), it doesn’t provide a clear test for when extensive verification of credit-granting standards will .......
News 19 September 2019
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CMBS NOI slowing
Sector developments and company hires
Aircraft ratings review
Moody’s has published a new overview which examines ABS issued in the US since 2013, backed primarily by commercial aircraft and their associated leases. The report details an asset description and its structure as well as asset-related credit risks in securities backed by aircraft and related leases. In addition, Moody’s has issued a Request for .......
Market Moves 19 September 2019
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Broader base
New investors come to STS, but for what reason?
A growing number of new investors, including bank treasuries, are participating in European STS securitisations, according to panellists at KNect 365’s European Securitisation Regulation seminar today. They added, however, that there is uncertainty about whether this is due to STS or other factors, such as a lack of yield in other asset classes.
Nicholas Curmi, head of securitisation and .......
News 18 September 2019
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Drilling down
Opportunities on offer in consumer, despite downturn concerns
Consumer finance in the US is still a relatively untapped asset class among institutional investors, despite the relative value opportunities on offer. This is according to an asset manager in the space that suggests too that negative connotations pertaining to subprime lending are unfair, particularly when investors are largely being compensated for the risks they are taking on.
Ed Mallon, .......
News Analysis 17 September 2019
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UK CMBS prepped
Retail-backed CMBS markets despite major tenant concerns
Deutsche Bank is marketing a £114m UK CMBS, dubbed Deco 2019-RAM. The transaction mainly comprises a £150m CRE loan backed by Intu Derby, a regional shopping centre in Derby, England, to The Wilmslow, a newly formed joint venture between the Intu Group and Cale Street Investments.
The transaction is provisionally rated by DBRS and S&P as triple-A/triple-A on the £100.8m .......
News 16 September 2019
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CLO downgrade announced
Sector developments and company hires
CDS hire announced
Axiom Alternative Investments has appointed Bedis Gharbi as senior portfolio manager, to support the continued development and diversification of its growing London office and fund range. Gharbi brings over 20 years’ experience in the investment management industry, most recently as head of synthetic credit funds at RiverRock European Capital Partners. He will join Axiom’s London .......
Market Moves 16 September 2019
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SCI Start the week - 16 September
A review of securitisation activity over the past seven days
Transaction of the week
Alior Leasing has launched a 12 month revolving cash securitisation of auto leasing loans and leases extended to sole traders and SME obligors in Poland. Dubbed AL Poland Securitisation 01, the transaction is the first to receive a public rating by Moody's.
Moody's has assigned a rating of Baa2 on the PLN359.9m floating rate secured notes, .......
News 16 September 2019
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Targeting opportunities
Servicers continue hunt for Greek NPL ABS
Hipoges Iberia, the Iberian servicer, is targeting opportunities in the Greek non-performing loan market that include NPL securitisations. Servicers are targeting Greek NPL ABS deals (SCI 31 May) amid actual and pending completions of NPL ABS transactions, as well as the European Commission’s pending approval of a government-backed NPL securitisation programme (SCI 12 October 2018).
The .......
News Analysis 13 September 2019
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ECB stimulus announced
Sector developments and company hires
ECB stimulus package outlined
The ECB has announced that it is cutting the interest rate on the deposit facility will be decreased by 10 basis points to -0.50%. The interest rate on the main refinancing operations and the rate on the marginal lending facility will remain unchanged at their current levels of 0.00% and 0.25% respectively. Additionally, net purchases will .......
Market Moves 13 September 2019
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Green ABS recommendations outlined
Securitisation could be key tool in climate change battle
Green securitisation can play an important role in helping to close the yearly investment gap of almost €180bn needed to meet EU climate and energy targets by 2030, according to AFME. The industry body, and its members, “strongly support” the growth of a green ABS market but recommends the need for greater clarity around definitions of green securitisation, as well as .......
News 12 September 2019
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Polish ABS inked
Securitisation features auto lease collateral
Alior Leasing has launched a 12 month revolving cash securitisation of auto leasing loans and leases extended to sole traders and SME obligors in Poland. Dubbed AL Poland Securitisation 01, the transaction is the first to receive a public rating by Moody’s.
Moody’s has assigned a rating of Baa2 on the PLN359.9m floating rate secured notes, while the .......
News 11 September 2019
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CLO firm incorporates ESG approach
Company hires and sector developments
Cayman CLO first
Maples Group has supported the first ever US CLO to issue out of the Cayman Island. The transaction was a US$501m middle market CLO from Natixis, which closed on 13 August 2019.
ESG implementation
THL Credit has developed and begun utilising a new investment framework for assessing environmental, social, and governance (ESG) factors .......
Market Moves 11 September 2019
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Country md announced
Company hires and sector developments
Country md announced
Jervis Smith has been appointed country md of Vistra Luxembourg, responsible for leading Vistra’s Luxembourg office and growing the business, together with the Vistra office in the Netherlands to maximise joint opportunities between the two offices. Based in Luxembourg, he will report to Vincent Bremmer, regional md, Europe, Vistra. Smith previously spent over 25 years .......
Market Moves 10 September 2019
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Performance questions
CMV conflict concerns aired
Scepticism about whether CLO managers and their investment affiliates can be truly independent of each other has accompanied the rise of CLOs anchored by risk retention capital raised via capitalised manager vehicles (CMVs). As the first iterations of these vehicles near the end of their reinvestment periods (SCI 26 June 2017), a better understanding of their performance could .......
News Analysis 10 September 2019
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Maltese benefits
Jurisdiction especially suited to innovative transport ABS
Malta provides a legal and tax framework that provides the same benefits for the establishment of SPVs as more well-known jurisdictions, such as Luxembourg and Ireland. Malta is also especially well suited to shipping and aviation securitisations, with several innovative transactions of this kind having been successfully completed through Maltese SPVs.
A legal framework for securitisation was enacted in Malta .......
News Analysis 10 September 2019
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CLO firm bulks up
Company hires and sector developments
CLO firm bulks up
Adrienne Dale has joined MidOcean Credit Partners a portfolio manager for its CLO strategies. She will report to Jim Wiant, who oversees MidOcean’s existing CLO business, as the firm looks to expand and scale the business further. Most recently, Dale held senior positions in Credit Suisse Asset Management’s credit investments group, where she spent the past .......
Market Moves 9 September 2019
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ILS deputy head hired
Company hires and sector developments
Blockchain standardisation steps taken
The standardisation of blockchain technology, which the International Organisation for Standardisation (ISO) and others are promoting, will be credit positive for future securitisations that utilise the technology, says Moody’s. Although the technology itself has the potential to provide many benefits to the securitisation market, namely via interoperability and operational efficiencies, the current lack of .......
Market Moves 6 September 2019