Asset Securitization Report articles from January 2008

Asset Securitization Report archives from January 2008

Whispers.
January 7, 2008... Lay-offs in the securitization world are starting to hit emerging markets. Dresdner Kleinwort has apparently dismissed people in the Latin American structured finance team of the New York office, according to sources. Managing Director Enrique...

That's Not an ABCP Revival.
January 7, 2008... Whenever U.S. rating agencies assess foreign asset-backed commercial paper programs, it is fair to assume that the sponsor is about to issue ABCP in the U.S. Such hopes were raised in the ASR newsroom when Moody's Investors Service...

Autos Lead Early 2008 Deal Pipeline: Small handful of consumer ABS deals load pipeline; Standard & Poor's braces for layoffs.
January 7, 2008... Three days into 2008, the ABS market was buzzing with more talk of layoffs and executive musical chairs than actual deal production. Despite the sluggishness and ongoing anxiety over how many layoffs are pending, however, traders and other...

More 08 Deals Seen from Strong Consumer ABS: Growth of 20% could happen for autos and cards; JPMorgan ends year atop lead manager heap.
January 7, 2008... Buoyed by solid credit performance, consumer ABS sectors are expected to perform well in 2008, and those asset classes might even see issuance increase by as much as 12% over the volume for 2007, according to early estimates from analysts at...

Market Sees Murky Outlook for U.S. CDOs in 2008.
January 7, 2008... As the CDO market ushers in 2008, many industry players are hoping that the gloomy conditions that plagued 2007 will remain in the past. But with recession fears looming over the structured credit markets, and rating agencies tweaking their...

Lehman Repeats As RMBS Champ.
January 7, 2008... Lehman Brothers flexed its muscle in 2007 and once again took the crown as the top U.S. RMBS manager, according to Thomson Financial RMBS manager rankings for 2007. This widened the gap between the top placer and Bear Stearns, which repeated...

So Long to a Dismal 2007 for Mortgages.
January 7, 2008... Volume was below 50% the normal amount in the last week of 2007. Many market participants were out for extended vacations and Wall Street desks were thinly staffed. The flows taking place were mixed and reactive to moves in Treasury rates. The...

More of the Same Problems for Euro ABS.
January 7, 2008... For European ABS market participants, it's a new year in name only. They have returned to work to deal with the same problems the sector faced in 2H07. While there are lingering concerns about how the future of European ABS will pan out,...

It's an Uncertain Year Ahead for European CDOs.
January 7, 2008... With no crystal ball to guide them, market players are finding it harder to predict how 2007's unprecedented liquidity crunch might affect future European CDO performance. Total European CDO volumes for 2007 are up from 2006 totals. The...

Future Flows: The Bloom's Still On. Will New Growth Follow?(diversified payment rights)
January 7, 2008... As one of the ugliest chapters in the history of securitization is being written, its hapless authors haven't had to devote much text to financial future flows. Consisting chiefly of diversified payment rights (DPRs) originated by...

Whispers.
January 14, 2008... Citigroup appointed Bill Beckmann to create a new division for Citi's U.S. residential mortgage business. The new unit will include origination, servicing and capital markets securitization execution. Beckmann will still report to Carl...

Panterra's Rise and Death Epitomizes 2007.(Panterra's Corp.)
January 14, 2008... Not too many securitization players are going to remember 2007 fondly. That applies to emerging market devotees too. Even with domestic markets in Mexico and Brazil braving the liquidity crisis and getting through in fairly good shape,...

Billions in Play as ABS Market Winds Up: Credit card, auto ABS are strongly represented, while BNC contributes sole MBS deal.
January 14, 2008... Issuers from mature asset classes as well as the small business sector gave the securitization market a fledgling start to the new business year. At least $4 billion in deals were expected to price by around Jan. 11. There is a lone...

Buffett to Restore Confidence in Monolines?
January 14, 2008... After last month's announcement that uber-wealthy investor Warren Buffett's Berkshire Hathaway would be starting up a new municipal bond insurer, many industry participants felt that the competition would likely deepen the already strained...

ASR Looks Back at 2007.(Asset Securitization Report)
January 14, 2008... Recognizing that 2007 was an unusual year, and that highlighting individual transactions would not convey the ethos of a tumultuous year, the ASR staff has decided to veer away from our usual practice of naming notable deals. Aside from the...

Broadhollow Dealt Blow to ABCP.
January 14, 2008... August turned out to be a blisteringly dry month for the ABCP and structured investment vehicle (SIV) markets. In its first week, mortgage REIT American Home Mortgage Investment Corp., declared bankruptcy, stopped taking mortgage...

Subprime RMBS Woes Spread.
January 14, 2008... Not that anyone needed further proof of just how significant the collapse of the subprime market was last year. But, last month, the American Dialect Society selected "subprime" as the 2007 Word of the Year. The global reverberations of...

Rating Agencies Targeted in Collapse.
January 14, 2008... The reputations of the rating agencies mirrored the fate of the securitization market last year: As the credit conditions went south, so did their standing in the industry. It was a strange year, to say the least, in which these agencies...

CDOs Go Through a Tumultuous 2007.
January 14, 2008... After a tumultuous summer in mortgages triggered a whirlwind of CDO downgrades, this past year will not be seen in a positive light for U.S. ABS CDOs. Despite growing issuance in the first half of 2007, CDO defaults in 2H07 as well as...

Ackman Casts First Doubt on Monolines.(Bill Ackman of Pershing Square Capital Management)
January 14, 2008... Monolines appear to be the primary target in the securitization market's game of mortgage loss speculation. Sources said that revisions to rating agency criteria for guarantors and the negative outlooks that resulted were the ugliest points in...

Euro Synth CDOs Remain Positive.
January 14, 2008... There wasn't any good news that emerged from the European CDO sector in 2007. But for banks and investors who braved the market and looked for some value in this beleaguered sector, European synthetic CDO tranches offered some respite. ...

HSBC's SIV Solution is a Trailblazer.(structured investment vehicles)(HSBC Americas Inc.)
January 14, 2008... The overall European ABCP market in 2007 was characterized by uncertainty. There were more questions than answers, and there was very little deal activity. However, one move by HSBC in the first week of December proved to be the most...

FSA Seeks Banking Reforms.(Financial Services Authority)
January 14, 2008... The European banking sector has been accused of being inadequately prepared to support securitization structures under crisis scenarios, despite a heavy reliance by these banks on the capital markets engine for funding. However, through new...

HSBC Dubai True Sale Stands Out.
January 14, 2008... The Middle East seems to be immune to the rest of the problems ailing the securitization world. The oil-rich nations are now sponsoring Shariah-compliant CMBS and RMBS using proceeds from petroleum wealth to serve as a liquidity backup. As...

Kazakh Banks 2007: From Story of Promise to Cautionary Tale.
January 14, 2008... A number of emerging market players delighted in the rhetoric last year about their world trading places with the U.S. The longtime risky bet and the safe haven, it appeared, had flipped. But soon the liquidity crunch metastasized into...

Boomerang Effect is Citi's Latest SIV Strategy.
January 14, 2008... From the beginning, many ABS professionals greeted the master liquidity enhancement conduit (M-LEC) plan with hearty skepticism. Why should a group of commercial banks pool their capital and create a support facility for $100 billion of...

Rating Agencies Make Cuts to Staff Globally.
January 14, 2008... Last week several announcements of job cuts were made by three of the top four rating agencies. The McGraw-Hill Cos., parent of the Standard & Poor's rating agency, eliminated 172 jobs from that division globally, as part of efforts to...

Prepayments Faster Than Expected in December.
January 14, 2008... Flows opened last week relatively balanced with participation from a wide range of investors. The activity was boosted by supportive market events such as paydown reinvestments and Class A settlement. However, things turned choppy on...

Freddie's Struggles Cloud Recovery.
January 14, 2008... While the GSEs are expected to play a crucial role in aiding the troubled secondary mortgage market, Freddie Mac's strained financial situation could delay these efforts. Moody's Investor Services reported on Jan.10 that it had placed...

Deal Flow In U.K. Credit Cards Still Slow: Euro credit card borrowers get their act together despite the lack of credit card deals.
January 14, 2008... Securitization investors aren't the only ones getting jittery in the current credit environment. The negative headlines that dominated 2007 seem to be making consumers nervous, and this edginess has translated into scarce deal flow for credit...

Whispers.
January 21, 2008... Mike Nierenberg and Jeffrey Verschleiser, who were previously co-heads of mortgage trading at Bear Stearns, have been promoted in a series of managerial changes at the bank. Verschleiser will head up a new business focused on distressed...

Are European Players Victims of Negative Headlines?
January 21, 2008... Negative headlines persist. But despite the carnage, European securitization market players should start recognizing the signs of healing and get on board. Clearly, patience is key since the reparations needed to restore the market are likely...

ABS Business Slows Amid Write-Downs: Credit card and auto ABS deals provide momentum in an otherwise still market.
January 21, 2008... It was a volatile week for Wall Street, as several banks delivered a punishing round of poor earnings reports, exacerbated by steep writedowns linked to subprime mortgage holdings. Accordingly, the securitization market hit a pothole on the...

Scope of Calyon's LMA Broadened.
January 21, 2008... Although not much activity is brewing in the ABCP market, Calyon managed to identify enough investor interest in the U.S. to support a newly created subsidiary of LMA, called LMA Americas. The new subsidiary will be able to issue...

CLOs Face Uncertain Times in 2008.
January 21, 2008... The mood was calm at The Loan Syndications and Trading Association's annual membership meeting last Tuesday, despite expectations of an uncertain year ahead for CLOs. "This is a very challenging financial environment; the financial system...

Covered Bonds in Germany, Canada.
January 21, 2008... The covered bond market took a huge leap forward in projected volume last week, when two new issuers tapped the capital markets for about 5.4 billion ($7.9 billion in financing for residential mortgage portfolios. Last week, Bank of...

Mortgage Industry Steps Up Loan Mods.(Brief article)
January 21, 2008... The mortgage industry modified roughly 54,000 loans and began formal repayment plans with an additional 183,000 borrowers, according to a study released by the Mortgage Bankers Association (MBA) last week. Meanwhile, foreclosure proceedings...

Integration Risks in Countrywide Purchase? Bank of America acquisition may save Countrywide but not jobs.
January 21, 2008... After the announcement that Bank of America would be acquiring struggling mortgage originator Countrywide Financial, market participants cheered that the deal was a step in the right direction for the troubled firm. But while Bank of...

Kondaur Predicts New Business Opportunities Ahead.
January 21, 2008... Rising mortgage delinquencies mean new business for scratch and dent lender Kondaur Capital Corp. With the expectation of a recession in 2008, depreciating real estate prices should lead to rising defaults and foreclosures until 2011. This...

Active Volume Amidst Recession Fears and Write-Downs.
January 21, 2008... Mortgage volume has been above normal in recent sessions, with Treasury yields trending lower and with the outlook for a full-blown recession gaining steam. Influencing events in the first half of last week were a weaker-than-expected...

Annual Freddie ARM Survey Sees Drop in Prime ARM Discounting.(adjustable rate mortgages)(Federal Home Loan Mortgage Corp.)
January 21, 2008... Freddie Mac released its annual ARM survey of prime loans for 2007 last week. Based on the survey, the GSE reported a sharp decline in interest-rate discounting of prime ARM loans as well as tighter credit underwriting resulting from the...

Ruble CLO Sets Sight on Westerners...and Waits: Attracting foreign interest would generate buzz for a second transaction.
January 21, 2008... Arranger Unicredit Aton International hopes the anxiety of Western European investors will ease soon enough for them to consider a slice of a short-term cash CLO of Russian SMEs that closed at the end of December. "We are holding a small piece...

Northern Rock Fiasco Pressures Granite.(Northern Rock PLC)
January 21, 2008... The battle for Northern Rock still isn't over, and a quick-fix solution is now nothing but a dream. Private bidders are struggling to find funding for a takeover bid while U.K. Prime Minister Gordon Brown hinted that the embattled mortgage...

Paragon Pursues Rights Issue.
January 21, 2008... U.K. buy-to-let lender Paragon has announced a GBP287 million ($563 million) rights issue, which would repay the company's GBP280 million working capital facility due on Feb. 27. Aside from improving its financial situation, the firm can also...

Lehman Brothers Brings Euro Loan Mods into Public View.
January 21, 2008... Lehman Brothers is making a lot of noise about its new U.K. RMBS loan modification program through which the firm aims to protect its nonconforming RMBS transactions. The loan modification process consists of a number of potential alternative...

Firm to Start Slew of Euro Soccer Deals.
January 21, 2008... Much ado was made about the string of soccer securitizations backed by popular teams with a global presence. But the reality is that outside the big names, securitization has proved too costly for many teams in the European soccer leagues. ...

U.S.Economy Bears Down: Fed Fights Looming Recession.
January 21, 2008... As the American economy appears to be on the precipice of a recession, the industry is now engaged in a dual debate about how to stave off a market downturn and how to recover from one. All eyes are turned to Federal Reserve Chairman Ben...

Whispers.
January 28, 2008... Bank of America said it will centralize its ABS platform in the U.S. The decision was made to ensure that the businesses are focused on the clients and their needs, and are sized properly in view of market conditions to present a stronger...

Why the Cold Shoulder to SLABS?
January 28, 2008... Generally speaking, the preference of the private sector is for government entities to keep their bright ideas and legislative actions as far away from commerce as possible. The gift of a government subsidy is precious indeed, and much...

Some Issuers Take Leap, Despite Wide Spreads Gulf: New business flow remained modest despite economic stimulus.
January 28, 2008... Congressional leaders and the White House were busy announcing a $150 billion economic stimulus plan that aimed to benefit consumers and businesses last week. The package would deliver stipends of up to $1,500 per household, and give tax...

FASB Board Closer to 140-d Vote.
January 28, 2008... Despite widespread objections from securities professionals, the Financial Accounting Standards Board (FASB) is expected to approve a set of policies that would, in most cases, require financial institutions to link the initial transfer of a...

CS Streamlines Global Banking.
January 28, 2008... Credit Suisse's plan to lay off 500 people is part of a major streamlining of its investment banking businesses, sources familiar with the situation said last week. Earlier last week, Credit Suisse said that it would lay off about 150...

Wells Fargo Launches CRM Service.
January 28, 2008... Talk of increased transparency is in the air, and Wells Fargo Corporate Trust Services has chimed in with the launch of its Collateral Risk Manager service, a product that allows issuers and investors to conduct in-depth analysis on their...

TRR CLOs Hit by Low Bids.
January 28, 2008... Market value ABS CDOs have taken a beating from declines in the value of their underlying collateral. And now, the recent downgrades on synthetic CLOs backed by total return swaps have demonstrated that falling prices in the loan market have...

Ambac Downgrade Ignites Series of Downgrades on Wrapped Bonds.
January 28, 2008... Ambac Financial Group has become the first AAA'-rated monoline to be downgraded by a rating agency, igniting a wave of rating actions for bonds wrapped by the insurer. But the ultimate impact of Ambac's write-downs, which sparked the...

Heavy Convexity Buying Follows Fed Rate Cut Announcement.
January 28, 2008... The shortened trading week was anything but uneventful. After heavy global equity losses caused by increasing recession fears, last Tuesday the Federal Reserve made a surprise 75-basis-point cut in the Fed Funds and Discount rates to 3.50% and...

Is Jumbo Primed for a Comeback This Year?(residential mortgage backed securities)
January 28, 2008... Talk of an economic rebound during a week that saw the Federal Reserve ramp up its efforts to stave off a recession may seem a bit premature, but some market participants are not ruling out the return of jumbo prime loans later this year. ...

Northern Rock to Return to Securitization?
January 28, 2008... New plans for a state-guaranteed securitization and potentially retained equity or windfall taxation are being discussed as measures to save Northern Rock. This is yet another addition to the long list of proposals to come to the rescue of the...

Deutsche Bank Remains Positive on 2008.
January 28, 2008... The head of Deutsche Bank's structured finance research team, Ganesh Rajendra, started 2008 on a hopeful note. He held a conference recently at the Deutsche Bank offices in London titled A New Dawn After the Storm. Despite his display of...

Industry Sees A Smaller Refinance Wave Building: MBA's index at highest level since 2004.
January 28, 2008... In a mortgage-backed market filled with uncertainty, there appears to be at least one growing consensus among market participants: This year could see a significant uptick in refinancing. The potential for a refinancing wave hinges on the...

Emerging From Distress: Euro Issuers Stir Still Waters.
January 28, 2008... Bad news continues to hit the ABS sector. Nonetheless, in these times of economic stress, securitization could still be used as a viable financing tool. But how can investors be lured back? "We remain convinced that despite some of the...

4th Quarter 2007 New Issues Guide: Card ABS Reign Supreme Over RMBS.
January 28, 2008... What a difference a year makes. This is clearly shown by the significant drop in securitization volume in 4Q07 compared with 4Q06. Industry totals for 4Q07 public ABS transactions only reached $82 billion, according to the ASR Scorecards...