Asset Securitization Report articles from January 2007

Asset Securitization Report archives from January 2007

Whispers.(AmeriCredit Corp. acquired Long Beach Acceptance Corp.)(Morgan Stanley's report on asset backed securities)(Commerzbank's report on bonds)
January 8, 2007... Ellington Management Group LLC could be a likely buyer of one, or several, of Orange, Calif.-based ACC Capital Corp.'s subprime lending units, sources say. Depending on which parts of ACC it buys, a purchase would grant the Greenwich,...

Citi holds lead in '06 as top arranger; Countrywide reprises top issuer role.(Citigroup Inc.)(Merrill Lynch and Company Inc.)(Lehman Brothers Holdings Inc.)(Financial report)
January 8, 2007... In the specialized business of ABS, Citigroup Global Markets attained its top ranking as lead manager of all public and 144a transactions in 2006 by being well rounded. The investment bank arranged about $120.7 billion in ABS deals, giving it a...

ML leads banner CDO year.(Merrill Lynch and Company Inc. dominates in collateralized debt obligations while Citigroup and Credit Suisse make strides forward)(Financial report)
January 8, 2007... CDO heavyweight Merrill Lynch once again dominated U.S. CDO underwriting in 2006. The firm brought not only the greatest dollar volume in deals to the market, but also led innovation throughout the sector's record-setting year. Through a...

Moody's promotes senior staff.(Moody's Investor Service promotes Claire Robinson, Gail Sussman and Bob Kurtter)(Brief article)
January 8, 2007... Claire Robinson won a promotion to senior managing director at Moody's Investors Service, where she will oversee the rating agency's asset finance group for the Americas, as well as its U.S. public finance group. Robinson's promotion...

ASR presents notable deals of 2006.(Brief article)
January 8, 2007... Rarely do the domestic and global ABS markets leave participants with little to discuss or remember from the previous year. Who would have imagined, still, that the student loan sector would produce one of the U.S. ABS market's most anticipated...

Nelnet's SAFE ABCP program caught investors' fancy in 2006.(Student Asset Funding Extendable )(Brief article)
January 8, 2007... Call it safe, call it predictable, but don't dare call the Federal Family Education Loan Program (FFELP) ABS collateral type stodgy. While the student loan ABS sector pulled out all the stops for a year of issuance totaling $34 billion, the...

Demand drives development of new CDO structures.(Collateralized debt obligations)(Brief article)
January 8, 2007... Energized by high demand and synthetic technology - from LCDS to CDO CDS to the ever-popular ABCDS - there was no shortage of notable deals within the U.S. CDO sector in 2006. A deal that picked up a lot of steam in the latter part of 2006...

Macquarie offshore CMBS a hit.(Macquarie Wanda Real Estate Fund)(collateralized Mortgage backed securities)
January 8, 2007... The one notable deal from China in 2006 was issued in the international market. Macquarie Wanda Real Estate Fund - a joint venture between Australia's Macquarie Group and Chinese property developer Dalian Wanda - in October sold the first...

VTB takes Russia's MBS lead.(JSC Vneshtorgank)(Mortgage backed securities)
January 8, 2007... Russia's first mortgage backed security is remarkable for a number of reasons, but the most compelling is this: private housing in the country scarcely existed before the 90s. By historical standards, the country's move from private property to...

European market innovations center on CMBS.(collateralized Mortgage backed securities)(Statistical data)
January 8, 2007... As the European securitization market matures so does its repertoire of deals. Gone are the days of extreme innovation. Instead, the market is increasingly defined by steadiness and dependability. This is demonstrated by the steadfast pricing...

Navistar introduces cross-border to Latin vehicle loans.
January 8, 2007... By November of last year, it appeared that Mexico would be a nonentity in the cross-border market for all of 2006. Domestic investors' unquenchable thirst for securitization was deterring originators from going abroad and the promise of the...

Ownit buyback requests far exceed assets.(Ownit Mortgage )
January 8, 2007... While Ownit Mortgage chief executive Bill Dallas reportedly filed for Chapter 11 bankruptcy in order to shelter his employees, buyers of the subprime lender's mortgage-backed bonds that want compensation for poorly performing loans appear as...

CDO manager Newcastle launches ABCP conduit Windsor Funding Trust.(Collateralized debt obligations)
January 8, 2007... Newcastle Investment Corp., a real estate investment and finance company, is planning its debut in the ABCP arena with an extendible note asset-backed commercial paper program that will execute repurchase agreements (repos) for its high quality...

CLOs may find enemy in lite and "friendly" loans.
January 8, 2007... With CLO managers ramping up funds in record numbers, investors have been scrambling to cash in on the diverse investment strategies that make these vehicles a safe choice for yield. However, a recent survey from Fitch Ratings found that these...

Bear Stearns heads RMBS league tables again.(Statistical data)
January 8, 2007... Lehman Brothers nearly edged out Bear Stearns from its spot as the top U.S. RMBS manager in 2006, but about $400 million stood in the way of its topping Bear, which has led the RMBS league tables for three consecutive years. Bear ended the...

Intro ARM discounts, hybrid ARMs mark Freddie survey.(Adjustable rate mortgages)
January 8, 2007... Freddie Mac released its annual ARM survey last week. As in the last survey, the agency reported that lenders were offering bigger discounts for introductory ARM rates and noted the popularity of hybrid ARMs versus one-year ARMs. In addition,...

Mortgages start 2007 by outperforming Treasurys.(Statistical data)
January 8, 2007... After a stellar 2006, mortgages are off to a strong start in 2007. According to Lehman Brothers, the MBS Index outperformed Treasurys by 122 basis points in 2006 compared with negative 37 basis points in 2005. The sector also performed well...

FTN Financial recommends triple whole loan PACs.
January 8, 2007... In a report released last week, analysts from FTN Financial recommended triple-A whole loan PACs. They said that for those buyers who would like to have additional carry, analysts are extending their recommendation to include triple-A whole...

Foreign MBS investing to remain strong in 2007.(Mortgage backed securities)
January 8, 2007... In 2006, foreign investors created demand for MBS and filled in the gap that other investors like the GSEs used to fill. Street analysts are predicting that this demand is going to continue this year. Specifically, UBS analysts said in a report...

Barclays gives buyers a closer look at ratings.(Barclays Capital )
January 8, 2007... The 2006 upgrade to downgrade ratio has been the most favorable in years, Barclays Capital analysts said. However, they caution that investors should pay heed to the overall credit picture and be ready for the potential credit-related issues...

Euro primary takes off without a bang although it's not all quiet on the secondary front.(Dexia)(Credit Suisse Group)(Dexia Capital Markets)
January 8, 2007... With another busy year over, European dealers could afford to take a brief moment of respite. The New Year kicked off at an uneventful pace despite expectations for a busy start of the year, with the city of London almost dormant as the U.S....

Whispers.(mortgage banks management)
January 15, 2007... A handful of arrangers are working with rating agencies to bring CDOs of CDO equity to the market, according to industry sources. The development comes on the heels of a number of structures that aim to redistribute the high yielding, but...

Primus, Athelon blaze CDPC trail for established structured finance players.(Credit Derivative Products Company launches)
January 15, 2007... No longer content to watch from the sidelines, big players have officially moved into the CDPC space -and some expect they'll come to dominate it, bringing a wave of liquidity with them. Marking the first entrance of a prominent structured...

Russia's great leap forward in 2006.(mortgages)
January 15, 2007... Turkey and the former Soviet Union republics branched out in new directions during 2006, producing $9.6 billion in ABS and MBS issuance tracked by ASR. While Turkey captured the highest volume, with $5.7 billion in deals, the underlying...

UCM's planned billion-dollar CMBS.(United Capital Markets)(commercial mortgage backed securities)(Ocean Land Investments)
January 15, 2007... Ocean Land Investments, a Boca Raton, Fla.-based developer, has recruited United Capital Markets to underwrite and arrange a construction loan, possibly as much as $5 billion, to redevelop a 43-acre parcel of oceanfront land in Florida. ...

Mason Street Advisor looks to boost ABCP participation.(Mason Street Advisors L.L.C.)(Brief article)
January 15, 2007... Conservative ABCP investor Mason Street Advisor, which prefers multiseller programs with the occasional auto loan ABS-backed single-seller programs, is stepping up its participation in those programs. The Milwaukee-based asset management...

Fitch mourns passing of longtime ABCP analyst.
January 15, 2007... Mick Brown, an asset-backed commercial paper analyst whose affable demeanor impressed the industry as much as his grasp of the market he covered, died on Friday, Jan. 5. He was 46. The cause was complications from pneumonia. Brown joined...

Liberty Hampshire launches Valcour Bay Capital.
January 15, 2007... The Liberty Hampshire Co. is preparing to launch the Valcour Bay Capital Co., an asset-backed commercial paper vehicle that can issue U.S. dollar-denominated CP, callable notes, and extendible notes to buy trade receivables and other financial...

Fitch downgrades Sprint Nextel deal.
January 15, 2007... Fitch Ratings downgraded Wirefree Partners III, LLC PCS Spectrum Lease-Backed Notes, 2005-1 to BBB', from BBB+', after taking a similar action on the unsecured corporate rating of Sprint Nextel and its subsidiaries. Sprint Nextel leases...

ABX.HE rolls forward this week into ... better performance?(asset backed securities)
January 15, 2007... The ABX.HE plummeted last week to all-time lows amid unrelenting news of issuers pulling out of the subprime mortgage market and the sour performance of loans originated in 2006. The activity - most dramatic in the triple-B tranches of the...

Zoom, zoom! Auto transaction revs up January's ABS market.(Asset backed securities)
January 15, 2007... For a brief moment, January threatened to turn into a lollygagging month for ABS issuance, shortened by two holiday workweeks and the pending American Securitization Forum conference in Las Vegas. Then the AmeriCredit Corp.'s $1.2 billion...

Seneca Capital offers pension fund-friendly CLOs, CDOs.(Seneca Capital Management)(Collateralized loan obligations)(Collateralized debt obligations)
January 15, 2007... Attractive returns have always been a selling point for plan sponsors, having led many to seek solace in fixed-income. Samuel Austin, senior portfolio advisor with Seneca Capital Management contends that continues to be the case, with one...

IACPM crosses into 2007 with new agenda.(International Association of Credit Portfolio Managers)
January 15, 2007... The importance of credit risk management has certainly ballooned over the past few years, with increasing competition for yield. With that in mind, the International Association of Credit Portfolio Managers (IACPM) is heading into 2007 with a...

Mortgages pressured by strong selling.
January 15, 2007... The New Year rally in mortgages petered out last week as the sector came under strong selling pressure. After gaining 25 basis points in excess return, according to Lehman Brothers' MBS Index in the first four days of trading, last week saw 12...

Lehman Brothers analysts retire five-year CMBS trade.(Lehman Brothers Holdings Inc.)(commercial mortgage backed securities)
January 15, 2007... Last Nov. 3, analysts Lehman Brothers initiated a recommendation to buy five-year triple-As versus three-year and 10-year triple-A CMBS. After a good run, they are now closing out the trade. At initiation, a duration-neutral, long five-year...

CMSA investor conference marked by market optimism.(Commercial Mortgage Securities Association)(Conference news)
January 15, 2007... Miami, Fla - The tone at the Commercial Mortgage Securities Association's CMBS Investors Conference was somewhat congratulatory as the industry looked back on a record 2006 - both in terms of issuance and growing market share within...

New faces at BNP signal new growth opportunities.(BNP Paribas S.A.)
January 15, 2007... As BNP Paribas closes the book on an eventful 2006, its credit derivatives structuring team continues to expand. These new additions mean more opportunities for the firm and further growth in store for 2007. Herve Besnard, who leads the...

Clearwater issues novel Asia ex-Japan CLO.(Collateralized loan obligations)(Clearwater Capital Partners)(Brief article)
January 15, 2007... Private equity firm Clearwater Capital Partners last week launched the first publicly rated CLO backed by Asia ex-Japan distressed debt. The offering was small, at only $146 million, but it signifies the growth many say is overdue in the Asian...

New balance sheet CLO paves the way for more to come in 2007.(collateralized loan obligations)
January 15, 2007... Barclays Bank kicked off last week by marketing the first U.K. balance sheet CLO of the year, paving the way for what's expected to be a busy season for balance sheet CLO issuance in 2007. Barclay's first balance sheet CLO of the year,...

REITs get right of way with U.K. debut.
January 15, 2007... The start of the year heralded the adoption of the new U.K. real estate investment trust (REIT) legislation. And with Germany slated to follow suit later in the year, the pace is set toward a better functioning and more global European REIT...

Whispers.(Terwin Holdings LLC acquires Hanover Capital Mortgage Holdings Inc.)(Residential Credit Solutions Inc. acquires Los angeles division of Aames Investment Corp.)(Markit Group appoints James Savitsky and Thomas Geraghty)
January 22, 2007... Terwin Holdings LLC last week bought Hanover Capital Mortgage Holdings Inc.'s due diligence business for $1.2 million, a move that was reportedly made to complement the company's due diligence service operation located in Denver. The deal...

Lehman Brothers: HEL ABS downgrades to rise steeply this year.(home equity loans)
January 22, 2007... Home equity loan downgrades could increase by three to four times this year compared with the second half of 2006, Lehman Brothers said last week in a report. Such an increase would mean as many as 1,500 bonds could be at risk for a downgrade,...

Mexico's issuance hits $6bn in 06.
January 22, 2007... No matter how you slice it, the Mexican securitization pie swelled to an unprecedented size in 2006. Deals in the domestic market totaled the local currency equivalent of $6.0 billion. According to Standard & Poor's, excluding a gigantic...

Mail-order ABS makes inroads.
January 22, 2007... European market maturity may mean more repeat transactions with less innovative structuring, but investors always have room and appetite for first-timers. Bayerische Landesbank last week closed its novel German mail-order receivables structure...

Not all senior classes created equal and not all are rated by Moody's.
January 22, 2007... A handful of managers are tweaking RMBS deal structures in order to achieve a Moody's Investors Service triple-A rating on super senior tranches they would not be able to obtain otherwise. The structural nuances essentially burrow the so-called...

Morgan Stanley: CDO managers make or break equity returns.(Collateralized debt obligations)
January 22, 2007... A phrase repeated so often it sounds like a broken record - that the firm managing a CDO makes a difference in its overall performance - must be falling on deaf ears, some said, as more and more new managers set up shop. While a firm classified...

Fitch launches first-ever auto loan seller/servicer criteria.
January 22, 2007... By Jennifer San Cartier, senior director, ABS, and Stephanie Petosa, managing director, operational risk, Fitch Ratings Fitch's seller/servicer review process determines the quality and effectiveness of an organization's origination,...

Continued selling as the mortgage market waits for Asian investors to show up.
January 22, 2007... Better selling continued to plague mortgages last week as the market continued to sell off on stronger-than-expected economic data. The 10-year Treasury yield has backed up 17 basis points in the past two weeks to 4.788% as of the close of Jan....

Citigroup notes that agency issuance finishes 2006 on an up note.(Statistical data)
January 22, 2007... Agencies finished 2006 on a positive note with gross issuance up by 8% in December, according to Citigroup Global Markets analysts. Even with the holiday-shortened week between Christmas and the New Year, agency gross issuance increased 8%...

Secondary demand sets market up before expected pipeline deluge.
January 22, 2007... The week following the Commercial Mortgage Securities Association annual conference in Florida normally sees a pickup after a pre-conference moratorium on issuance. Now five deals are in the CMBS pipeline and one is already setting price...

UBS says seasoned 15-years are very cheap.(Brief article)
January 22, 2007... Bank restructurings in the second half of last year contributed to a net decline in MBS holdings at banks, UBS analysts said in recent research. Selling was primarily in lower coupon MBS, some of which was offset by the purchase of higher...

CPDOs continue march across the globe.(Collateralized debt obligations)
January 22, 2007... Along with a continued push in the CLO sector, the CPDO contagion is likely to reach the Asian market this year, as an increasing number of arrangers in the region are inquiring about structuring the deals, according to Moody's Investors...

Arran sets the cards straight, prices new deal.(Arran Funding Ltd.)
January 22, 2007... Arran 2007-A, the long-awaited additional credit enhancement for the Royal Bank of Scotland's U.K. credit cards master trust Arran Funding Ltd., was launched last week, following a correction to calculation errors reported by the issuer late...

European players look to Granite pricing to set the bar.
January 22, 2007... The new Dutch 2 billion ($2.5 billion) prime RMBS for Obvion was part of the new issue line-up last week, raising the near-term visible pipeline to 22.7 billion. But even with the January pipeline building more quickly than it has in previous...

SG refocuses debt division.(Societe Generale Corporate & Investment Banking appointed Michel Cohen, Jean-Franaois Mazaud, Jean-Marc Giraud )(Brief article)
January 22, 2007... Societe Generale Corporate & Investment Banking is refocusing its medium-term business model to become a fully issuer-focused division across the equity-debt continuum under its newly unveiled Step up 2010 business plan. The capital-raising and...

New issuers, assets in LatAm crossborder for 06.
January 22, 2007... Some remarkable things took place in Latin America's cross-border market in 2006: Auto loans from the region debuted, Argentina returned with onshore assets, and Jamaica, considered part of the region, minted its first deal backed by...

Whispers.(Islamic Development Bank to open a structured finance unit)(Novastar Financial Corp. to close its collateralized debt obligation)(Credit Suisse Group to acquire ResMae Financial Corp. )
January 29, 2007... The Islamic Development Bank has opened a structured finance unit in Saudi Arabia, according to a source close to the situation. The move is in response to demand from member countries to finance large infrastructure projects with private...

CLO managers secure quality collateral by mounting origination platforms.
January 29, 2007... In the clubby world of smaller middle-market lending, CLO managers are having a hard time obtaining creme-de-la-creme middle market collateral. That is, unless you are able to obtain a member's only jacket in the form of an origination...

Allegheny Energy's ABS plans progress.(asset-backed securities)
January 29, 2007... After increasing the estimated construction costs for building an emissions control facility at a West Virginia plant, and adding a novel twist to the deal's structure, Allegheny Energy, Inc. received approval from the Public Service Commission...

Industry gathers in Las Vegas.
January 29, 2007... Ready to learn a thing or two about how to expand their corners of the ABS business, industry professionals are swarming around Las Vegas this week for the ASF 2007'. Some 6,000 registered attendees are expected at the conference, which,...

ASR: the industry's must-have handheld just got an upgrade.(Editorial)
January 29, 2007... To stay competitive, electronic gadgets in our day and age have to be multi-dimensional. It's not enough for a cell phone to merely make calls, it must also play music, send e-mails, take pictures and perform myriad other tasks. If it does only...

First managed CPDO expected in market.(Cairn Capital )(JPMorgan Chase & Co.)
January 29, 2007... After much talk, it appears that Cairn Capital will produce the first managed CPDO, to be sold by arranger JPMorgan Chase & Co. The deal is among the latest in a string of variations on ABN Amro's flagship CPDO product, Surf, which debuted last...

Grim outlook for HEL but principal CDO losses unlikely.(Statistical data)
January 29, 2007... The majority of outstanding mezzanine CDOs will experience HEL downgrades within their portfolios this year, Lehman Brothers researchers wrote in a report last week. Given an environment with 5% home price appreciation, roughly 90% of mezzanine...

ABS market starts off week torn between two sentiments.
January 29, 2007... During its last full workweek of January, the ABS market started off by displaying a full spectrum of sentiments. On one extreme end, investors remained wary of spread levels to enter into ABX trades after the rollout of the third ABX.HE index,...

Higher small business ABS delinquencies seen in 1H 2007.
January 29, 2007... U.S. small business loan ABS will likely undergo higher delinquencies for the first half of 2007, because of shifting economic conditions and credit concerns. Specifically, securitizations of unguaranteed portions of Small Business...

Clarification:.(Correction notice)
January 29, 2007... In the January 15 issue, the name of Athilon Structured Investment Advisors was misspelled. (c) 2007 Asset Securitization Report and SourceMedia, Inc. All Rights Reserved. http://www.asreport.com http://www.sourcemedia.com

Fixed rates lure borrowers to closed-end second-lien loans and away from HELOCs.
January 29, 2007... By David Glehan, director, and Amanda Hopkins, rating specialist, Standard & Poor's The closed-end second (CES) lien securitization market continues to grow dramatically, offsetting the trend of borrowers retreating from HELOCs, which do...

Consumer credit shows little stress.(Survey)
January 29, 2007... The consumer credit outlook for 2007 looks benign. Although mortgage delinquencies and foreclosures are rising, they are up from exceptionally depressed levels. There was little room for them to go anywhere but higher. According to the...

February CMBS issuance seen as nearing monthly record.(commercial mortgage-backed security)
January 29, 2007... The CMBS market is gearing up for the heaviest issuance month on record, with February production now seen surpassing the previous monthly record from December 2006 and approaching almost $40 billion in fixed rate issuance. First quarter totals...

Freddie Mac's retained portfolio slips in December.(Statistical data)
January 29, 2007... Freddie Mac reported in its monthly volume summary report for December, which was released last Tuesday morning, that its retained portfolio slipped 1.2% after holding steady in November. The retained portfolio ended the year at $703.6 billion,...

System errors hatch more problems at Egg Banking.
January 29, 2007... Egg Banking reported last week that a system error has led to an understatement in the level of charge-offs in the Pillar trust. According to the press release issued by the bank, the error relates to the treatment of overpayments made by...

Prepayments still a concern in European CMBS.(collateralized Mortgage backed securities)
January 29, 2007... Despite recent high profile CMBS prepayments, such as White Tower 2006-1 and 2006-2, market sources said 2007 should see the level of prepayments fall on the back of modest interest rate hikes and a slowdown in property value increases. ...

After a quiet start, January begins to see more action.
January 29, 2007... Many market players found the rather tame start to the new year a bit unexpected. The hefty December calendar promised some spillover, as it was said that issuers, particularly from the CMBS space, would hold on to their deals and wait for a...

Still some questions unanswered about Basel II, though it's already a reality for some banks.
January 29, 2007... The new year has rung in the much-anticipated regulatory capital changes under the new Basel II accord, with the first wave of European banks having already implemented the standardized approach. A second wave of banks that would adopt the...

Japanese RMBS will continue to be strong in 2007.(residential mortgage-backed security)
January 29, 2007... Moody's Investors Service said that although RMBS growth has slowed somewhat from previous years, it would remain a dominant asset class in the Japanese ABS market this year. Analysts from the agency reviewed Japan's RMBS for 2006 and set...