Asset Securitization Report articles from December 2005

Asset Securitization Report archives from December 2005

Whispers.
December 5, 2005... Douglas Landy has joined Cadwalader, Wickersham & Taft as special counsel in the securities and financial institutions regulation department, where he will focus on domestic and foreign financial institution regulation, compliance, risk...

TCW sees low risk of housing bubble fear deflating ABS CDO demand.
December 5, 2005... LOS ANGELES - For the first time in a long while, volatility has returned to the home equity ABS market. And with that volatility, some would argue, comes a more challenging terrain for ABS CDO managers. For example, new issue spreads have...

U.S. Bancorp to hit No. 2 ABS trustee.(asset backed securities)
December 5, 2005... U.S. Bancorp bolstered its status as one of the nation's major ABS and MBS trustees last week when it announced the acquisition of Wachovia Corp.'s corporate trust and institutional custody businesses. With this purchase, U.S. Bancorp will...

Yet another round from Turkish banks.
December 5, 2005... U.S. investors may be sated with turkey so soon after Thanksgiving, but the eponymous country is providing plenty to nibble on. Turkiye Is Bankasi (Isbank) is readying a $350 million deal backed by credit cards - a sporadically tapped asset...

ABS primary hits $15 billion as market turns for home.(asset backed securities)
December 5, 2005... The U.S. ABS primary market generated $15 billion in issuance last week, carrying the market into its final month of what has been another record-breaking year. Issuance volume for 2005 has already surpassed last year by over 20% and, if...

RBS evaluates California earthquake threat to HEL ABS.(RBS Greenwich Capital)
December 5, 2005... Not long after information bearing the actual extent of the damage caused to the Gulf Coast region by Hurricane Katrina began to hit investors on Wall Street, mortgage lenders, insurers and others, did the conversation turn to the future - and...

MH defaults and losses increase, CSFB says.(Credit Suisse First Boston L.L.C.)(manufactured housing)(Brief Article)
December 5, 2005... Defaults and losses in the manufactured housing sector increased for most vintages, while delinquencies were mixed and repossession levels improved for most vintages, according to a report by Credit Suisse First Boston. Losses improved for...

CMBS prepayments expected to pick up through year-end.(commercial mortgage backed securities)
December 5, 2005... Even while prepayments in the residential mortgage market cool down, the number of commercial mortgage borrowers currently prepaying their loans is not only soaring but anticipated to accelerate through year-end and into 1Q06, according to...

Auto ABS still strong as 2006 approaches although cracks begin to show.(asset backed securities)
December 5, 2005... The U.S. auto ABS market has soared to new heights this year with over $100 billion in issuance, and performance has stayed strong throughout and even improved, according to analysts. However, questions about the strength of the U.S. consumer...

Active selling from fast money as market sells off.
December 5, 2005... Mortgages were hit with strong selling last week with investors shedding duration as the market backed up on stronger-than-expected economic data and uncertainty regarding Friday's employment report. On Wednesday alone, there was $4 billion...

Slowing housing market imminent.
December 5, 2005... Despite a surge in new home sales reported last week, the National Association of Realtors predicts that the housing market will slow down by 2006. "I think the market has shifted from the frenzied level of activity to a more manageable...

Rising loan limits to heavily impact the jumbo sector.
December 5, 2005... Last week Fannie Mae and Freddie Mac announced new conforming loan limits for next year would be increased 16% to $417,000 from $359,650 - the largest annual rise on record in both percentage and absolute dollar terms. The limit, determined by...

Analysts predict slow prepayment speeds ahead.
December 5, 2005... The November prepayment report will be out Tuesday evening. Street consensus predicts speeds to slow around 15% to 16% in FNMAs and slightly less in GNMAs. In midweek comments from JPMorgan Securities, analysts are anticipating speeds will slow...

Spectrum ruling to stimulate asset-backed lending.
December 5, 2005... Not all the consequences of the recent Spectrum Plus ruling (see ASR, 10/10/05) on U.K. securitization have been worked out, but the case has produced a clear winner: the invoice finance or asset-backed lending market. This is the consensus...

In Europe, the new deals just keep coming.
December 5, 2005... The European market is bustling with action. Barclays priced its GBP5 billion ($8.6 billion) U.K. SME CLO Lambada Financing last Tuesday and on Wednesday had another GBP4.5 billion in the pipeline via its Gracechurch U.K. RMBS deal. On...

BCP taps, while Credomatic CC deal dropped into conduit.(Banco de Credito del Peru)
December 5, 2005... Two financial flows deals have recently closed in Latin America, hailing from different corners of the region. Touted as the largest debt issue by a Peruvian financial institution, Banco de Credito del Peru closed a $280 million, two tranche...

Thai government ABS comes to market.(asset backed securities)
December 5, 2005... The Government of Thailand last week completed the first deal from its THB24 billion ($582.5 million) securitization program, established to finance construction of a huge office complex on the outskirts of the capital. Bangkok Bank,...

CDOs dominate Taiwanese ABS activity.(collateralized debt obligations)
December 5, 2005... Following the path set by Chinatrust Commercial Bank's NT$18 billion (US$536.8 million) offering designed by UBS in September, two more CDO deals have been completed in recent weeks, with more to follow. In order to enhance returns, UBS...

Last obstacle removed for China pilot deals.
December 5, 2005... Asian ABS professionals, particularly those at Lehman Brothers and Standard Chartered, received an early Christmas present when Chinese authorities lifted the one remaining tax hurdle causing delays to the pilot securitization schemes by China...

Malaysia's Cagamas strikes again.(Brief Article)
December 5, 2005... Another state entity in Malaysia launched its latest securitization offering last week. Secondary mortgage company Cagamas, which has assumed the role of Malaysia's benchmark issuer in the last year, will issue a M$2.06 billion (US$530.8...

Korea set for strong year-end finish.(Brief Article)
December 5, 2005... Korea is set to enjoy a strong finish to 2005. After Samsung Card recently secured Korea's first case of triple-A ratings for an unwrapped transaction with a $300 million credit card issue via Standard Chartered, local rival LG Card completed a...

Whispers.
December 12, 2005... At press time, the rumor mill was rife with speculation that HSBC's head of Asian structured capital markets Sarwar Ahmad is to leave the firm. Although neither party would comment, several sources, including rival bankers and financial...

Hedge funds: friend or foe to U.S. housing market?
December 12, 2005... LAGUNA NIGUEL, CALIF. - The towering wall of liquidity that continues to prop up the U.S. CDO market could begin to crumble in 2006, as credit concerns over the health of the residential housing and corporate credit markets begin to sour...

Bulls abound at Asian ABS powwow.(asset backed securities)
December 12, 2005... SINGAPORE - Attendees at last week's Securitization World Asia 2005 event, hosted by Terrapinn at the Grand Hyatt Hotel, were in the mood to celebrate following a successful year for the region's ABS scene. The outlook is bright as well, with...

BMA & Euro groups take on FSA.(Financial Services Authority.)
December 12, 2005... Five European trade groups have formed the EU Bond Price Transparency Committee to refute suggestions that greater price transparency would benefit U.K. and European bond markets. The committee - made up of the Bond Market Association, the...

New CRE CDOs turn heads.(commercial real estate)(collateralized debt obligations)
December 12, 2005... LAGUNA NIGUEL, CALIF. - As an increasing number of commercial real estate investors become first-time CDO issuers, investors are wondering: Are these deals much more than a form of secured financing? Commercial real estate CDO issuance this...

Surprisingly, some investors seek higher RMBS concentration.(real estate mortgage backed securities)(collateralized debt obligations)
December 12, 2005... LAGUNA NIGUEL, CALIF. - While most seem to think the residential -heavy CDO market will naturally shift toward deals with more diverse pools of assets as investors voice concern over the U.S. housing market, some are noting to the contrary. ...

Securities offering reform spills into private sector.
December 12, 2005... LAGUNA NIGUEL, CALIF. - As the market prepared for the Dec. 1 implementation of new rules governing the securities offering process, a question lingered among structured finance professionals - whether the reforms governing the offering process...

Credit opportunity funds expect feeding frenzy.
December 12, 2005... LAGUNA NIGUEL, CALIF. - Credit opportunity funds - defined as a fund that allows the manager to rejigger his or her asset mix - are employing that flexibility to swoop in and purchase discarded CDO bonds, said Dale Leshaw, head of credit at...

ABS primary prices $23 billion as late year rush continues.(asset backed securities)
December 12, 2005... The U.S. ABS primary market posted another extraordinary week, generating $23 billion in issuance and continuing the predicted flood of paper as issuers rushed to get deals finished before the Jan. 1 implementation date of the Securities and...

CenterPoint prices first part of $1.85 billion RRB program.
December 12, 2005... After nearly two years of leaping regulatory hurdles, Houston-based CenterPoint Energy priced a $1.25 billion rate reduction bond offering last week. The deal is to be the first chunk off a $1.85 billion RRB program approved this spring, with...

Bear Stearns: early 2005 vintage performance not so bad.(Bear Stearns Companies Inc.)
December 12, 2005... Much attention lately has been paid to the prospective performance of subprime mortgages originated to borrowers this year. The 2005 vintage, some say, consists of borrowers that either needed to refinance to avoid payment shock from earlier...

IACPM releases Sound Practices' guide.(International Association of Credit Portfolio Managers )
December 12, 2005... Managing a loan or bond portfolio is a far cry from what it used to be, thanks to recent market developments such as the rapid growth of credit derivatives. In fact, the changing ways of the credit portfolio management business - and the...

Credit derivatives to get riskier in 06.
December 12, 2005... The credit derivatives market has grown so exponentially (by 86% in 2005 alone) that its notional value of $5.3 trillion now tops the $5.0 trillion of the entire US corporate bond market, according to a Fitch Ratings survey released recently....

Analysts dissect Freddie Mac's increased disclosure.(Federal Home Loan Mortgage Corp.)
December 12, 2005... At the beginning of the month, Freddie Mac started releasing loan level data on newly issued pools. Analysts said that the additional information is welcome but will not have as much impact as the enhanced pool level data Freddie Mac released...

Fitch projects rise in subprime delinquencies in 06.(Brief Article)
December 12, 2005... Fitch Ratings is forecasting subprime mortgage delinquencies to rise as much as 10% to 15% in 2006 from current levels. The rating agency late last week released its structured finance outlook report for next year, which did contain positive...

Rising mortgage rates slow home price appreciation.
December 12, 2005... Freddie Mac reported last week that its quarterly national Conventional Mortgage Home Price Index (CMHPI) rose 12.1% for the period from 3Q04 through 3Q05. For the quarter, home prices grew 2.9%, or 12.3% annualized. This is down from the...

Condo converters turning to CMBS.(commercial mortgage backed securities)
December 12, 2005... Now that Credit Suisse First Boston has underwritten the second structured finance deal ever backed entirely by loans tied to the conversion of apartments into condominiums, other banks are looking to get into the game. Rating agencies say...

November prepayments fall, with further drops expected.
December 12, 2005... The November prepayment reports released last week showed speeds on 30-year fixed rate mortgages falling 16% from October. Bear Stearns researchers report that aggregate prepayments on 30-year FNMA product dipped 3 CPR to 15.4 CPR while...

European issues set to hit $350 bn in 05 as pipeline brims.
December 12, 2005... European ABS volumes look ready to hit another record this year - nearly $350 billion according to market sources - as the December pipeline resists the holiday lull. Pricing spreads are expected to see a repeat of late 2004 and withstand...

FGIC U.K. grows into euro-player in just a year.(Financial Guaranty Insurance Company)
December 12, 2005... FGIC has just passed its first year anniversary of opening its London office. Over the past year, the monoline insurer has achieved market acceptance across a spectrum of deals that range from private finance initiatives to CLOs and everything...

Spain ditches withholding tax for foreign buyers of ABS.
December 12, 2005... Spanish regulators continue to re-shape securitization legislation in an effort to bring the country up to par with the leading issuers in Europe. The latest development does away with the cumbersome withholding tax. Law 23/2005 (see ASR...

Mexican originators keep it moving ahead of holidays.
December 12, 2005... Mexico's domestic ABS issuance has yet to lose steam ahead of the looming holidays. Two deals have priced so far this December and at least a couple of others could close before the year is up. The last originator to descend on investors...

EEMEA securitizations hit $8.1 billion in 2001-Nov. 2005.(Eastern Europe, the Middle East, Africa)
December 12, 2005... Securitizations out of Eastern Europe, the Middle East, Africa and the ex-Soviet Union totaled 6.9 billion ($8.1 billion) over the first 11 months of 2005, according to a report by Standard & Poor's. That figure for the region, commonly known...

Kazkommerts prices $300m future flow.(Kazkommertsbank)(Brief Article)
December 12, 2005... Kazakhstan's largest commercial bank, Kazkommerstbank, closed its first public deal backed by diversified payments rights last Thursday. The originator issued a $200 million, seven-year tranche wrapped by Ambac, with a spread of 29 basis points...

Japan's Shinsei poised to be an ABS pinball wizard.(asset backed securities)
December 12, 2005... There has been plenty of prep work for Asian deals likely to launch at the start of 2006. Most activity will come from Japan, with at least three transactions in the pipeline. Pachinko pinball parlor operator Daiei Co. is lining up a Y25...

Cagamas pulls them in for latest MBS.(mortgage backed securities)
December 12, 2005... Malaysia's secondary mortgage company Cagamas last week priced its third MBS. It was the issuer's second to use a conventional structure following a similar effort in October 2004 and an Islamic deal this July. AmMerchant Bank and Standard...

Whispers.(appointment of Gloria Aviotti at Fitch Inc.)(appointment of Lynne Gochanour Chapman and Cutler)(J.P. Morgan Chase and Co. (New York, New York) acquires Collegiate Funding Services L.L.C.)
December 19, 2005... Fitch Ratings named Gloria Aviotti as the new head of the U.S. structured finance group in New York, assuming management responsibilities for all U.S.-based structured finance rating groups. Aviotti takes over the duties of Douglas Murray, who...

New hybrid CDOs, fueled by ABS default swaps, steal show in 2005.(collateralized debt obligations)(asset backed securities)
December 19, 2005... The newest developments and dramatic growth within the single-name home equity ABS credit default swap market lies behind some of the biggest innovations within the structured finance CDO sector seen this year. These developments not only are...

RMBS transaction provisions released.(residential mortgage backed securities)
December 19, 2005... Last week the American Securitization Forum released the model contractual provisions for MBS issuers to use with their existing loan purchase and servicing agreements. The new provisions, known as "Model Provisions for Residential Mortgage...

European ABS likely to slow in 2006.(asset backed securities)
December 19, 2005... Another record year is set to close in the European ABS market, with some estimates putting the 2005 tally close to the $350 billion mark. While most market players are expecting more growth from certain sectors in the market, the level of...

U.S. auto lenders top concerns heading into 2006.
December 19, 2005... As 2005 comes to a close, outlooks for the coming year are beginning to trickle out. Although, as of last week, opinions remained limited participants seem to be learning and are predicting that issuance volume remain at least on par with 2005....

U.S. ABS market prices $13 billion as Holiday's close in.(asset backed securities)
December 19, 2005... The U.S. ABS primary market priced $13 billion last week as the market slowed slightly going into the closing weeks of the year. The calendar was, as usual, dominated by real estate-related deals, but last week it was unusually so, as only one...

FBR: Income growth to exceed increased mortgage, energy costs.(Friedman Billings Ramsey)
December 19, 2005... Personal income growth is expected, by and large, to exceed upward movement in both the per-capita cost of energy and adjustable-rate mortgage payments upon rate reset among non-agency borrowers, according to a recent report by Friedman...

Fitch: affordability products will ensue for subprime borrowers.
December 19, 2005... While roughly one-third of outstanding subprime mortgage loans are scheduled to reset into higher interest rates, mortgage issuers are expected to be waiting in the wings with a new suite of affordability products to help keep mortgage payments...

Mixed maturity synthetic CDO comes to market, more expected.(collateralized debt obligations)(Brief Article)
December 19, 2005... Fortis Bank recently completed one of the first synthetic CDOs incorporating credit default swaps with varying maturity dates. The Regatta CDO, issued by Solent Capital, includes both five-year and eight-year maturing credit default swaps. The...

Investors respond favorably to FOMC statement.(Federal Open Market Committee )
December 19, 2005... Ahead of the Federal Open Market Committee meeting last week, mortgage flows were quiet but picked up sharply following the statement that suggested the FOMC is nearing an end to its tightening cycle. Following the announcement, mortgages saw...

Ginnie Mae buyout information sheds light on premium GNMA speeds.(Government National Mortgage Association )
December 19, 2005... Ginnie Mae recently released additional disclosure items such as buyout information, buydown percentages and delinquency data. The new data, which is one month lagged, was as of the Nov. 1 factor date and reflects prepayments occurring in...

Rough ride ahead for MBS but with positive performance on the horizon.(Mortgage backed securities)
December 19, 2005... Although it's not going to be all smooth sailing in MBS land next year, things are expected to look up for the sector in the second half of 2006. Countrywide Securities Senior Strategist Bill Berliner said that he is short-term neutral to...

North Sea island CDO 1 closes $550 million CDO program.(Brief Article)
December 19, 2005... ABN AMRO closed its $550 million synthetic CDO program, North Sea Island CDO 1, which provides exposure to ABN AMRO's $3 billion portfolio of high-grade asset-backed securities under its North Sea Funding arbitrage conduit. The transaction is...

Barclays survey sheds insight into European ABS investor drive.
December 19, 2005... The phenomenal year-over-year growth of the European ABS market is set to continue in 2006. But as the market grows so has the number of players and new entrants have unleashed speculation among European investors about the make-up, motivations...

EEMEA 2006: Existing assets ripe for intelligent design.
December 19, 2005... The region encompassing Eastern Europe, the ex-Soviet Union, and the Middle East is expected to continue evolving next year, particularly in existing assets. There's a buzz surrounding Russia, Turkey, Kazakhstan and even parts of the Gulf...

Brazil and Mexico in 2006: This time, ballot box is not necessarily Pandora's box.
December 19, 2005... Domestic issuance in Latin America's bulkiest markets - Brazil and Mexico - is forecast to keep growing in 2006, despite upcoming presidential elections in both countries. Sources concede that there will be a window of diminished or no issuance...

1st Taiwan MBS of 2005 slips in.(Brief Article)
December 19, 2005... Hsinchu International Bank was set to price the first cross-border residential mortgage backed securitization out of Taiwan. Calyon Securities is sole lead manager on the 250 million ($301 million) issue and will also provide the swap to...

LG Card tops $1 billion with latest deal.(Brief Article)
December 19, 2005... South Korea's second largest credit card originator LG Card took its 2005 securitization issuance beyond the $1 billion mark with a $300 million private placement. JPMorgan Securities and Korea Development Bank jointly handled the deal, which...

Malaysia emerges as leader in 2005.(Brief Article)
December 19, 2005... Malaysia's emergence as a market of real potential has been one noticeable feature of 2005. Local rating agencies confirmed the fact with the release of new data estimating ABS issuance for 2005 will reach M$10 billion ($2.6 billion). ...

China opens up to new deal structures, new participants.
December 19, 2005... China's securitization market finally reached a new maturity level this fall, with new participants and new deal structures. The watershed moment was September's listing of asset-backed securities from China Unicom on the Shanghai Stock...

Christmas no holiday for China dealmakers.
December 19, 2005... While the year's work is effectively done for most of Asia's securitization professionals, those involved on the two Chinese pilot programs were working furiously last week to ensure the deals priced before Christmas. Both China Construction...

Standard Chartered claims first "true" loan securitization.
December 19, 2005... The China Construction Bank privatization project, recently approved by the Chinese government, may become the first true loan securitization in China. As the sole advisor, Standard Chartered gains both experience and credibility in the...

CSFB helps move securitization forward in China.(Credit Suisse First Boston)
December 19, 2005... In the spring of 2004, China's largest commercial bank struck a deal with Credit Suisse First Boston, CITIC Securities and China Credit Trust to securitize a portfolio of RMB2.6 billion ($322 million) in non-performing loans. The loans...

CITIC named Special Purpose Trust in ground-breaking project.(China International Trust and Investment Corp)
December 19, 2005... This fall, one of the two big bank securitization projects in progress is the MBS project of China Construction Bank. The Special Purpose Trust that will handle the underlying assets of the securitization is the CITIC Trust Co., based in...

Brokerage pioneer in China's securitization space.
December 19, 2005... While other brokerage firms have tried - but so far failed - to get securitization projects off the ground, the Beijing-based China International Capital Corp. has jumped ahead of the pack with a fixed-income product based on a...