Asset Securitization Report articles from May 2006

Asset Securitization Report archives from May 2006

Whispers.(RBS Greenwich Capital)(New Century Financial Corp.)(Lehman Brothers Holdings Inc.)
May 8, 2006... Boston-based law firm Goodwin Procter LLP recently opened offices in Los Angeles and San Francisco - plucking eight partners from firms Pillsbury Winthrop Shaw Pittman LLP and Cooley Godward and relocating two of its own. The firm plans to...

Onshore assets ripen in Turkish spring.(capital market)
May 8, 2006... Last year, Turkey turned the landscape of offshore future flows into its virtual fiefdom. Now Turkish issuers appear to be marching on to existing onshore assets. So far, the sector is just talk but a pipeline is building, according to sources....

Pros call for more flexible aviation ABS.(asset backed securities)
May 8, 2006... NEW YORK - The capital markets swung its doors wide open to the aviation industry last year, allowing close to $5 billion in issuance. Still, the securitization market could go a lot further if it could allow more flexibility within the deal...

Market mulls effects of ACC layoffs.
May 8, 2006... Privately held ACC Capital Holdings, the parent company of Ameriquest Mortgage Co., last week announced the closure of 229 retail branches, resulting in job loss for roughly 3,800 of its employees - representing about 70% of its retail staff....

Vertical to manage first CRE CDO.
May 8, 2006... Bear Stearns this month will bring to market a $300 million commercial real estate CDO. The deal, Vertical CRE CDO 2006-1, will be the first CRE CDO managed by Banc of America subsidiary Vertical Capital, which has six deals in the market...

Lehman devises student loan prepayment evaluator, as sector morphs.(Lehman Brothers Holdings Inc.)(spree-interactive tool for loan assessment)(Brief article)
May 8, 2006... Volatile prepayment speeds on student loans have made it difficult for investors to assess how ABS bonds will respond to prepayments. This is why Lehman Brothers created an interactive tool called SPREE that takes an investor's loan-level...

Seasonal slowdown drags into May, as ABS primary market does $4 billion.(asset backed securities)
May 8, 2006... The U.S. primary ABS market ground through another week of moderate issuance, as volume came to a moderate $4 billion by press time. Another $300 million or so was expected to price by Friday, bringing production in line with estimates. ...

Moody's exposes CDO asset trends.(Moody's Investors Service)(Collateralized debt obligations)
May 8, 2006... Moody's Investors Service said last week it will begin providing monthly reports on the individual asset exposures by CDO category and vintage within 650 U.S. cash flow transactions issued between 1996 and 2005. While the rating agency is...

Mortgages struggle on yield curve dynamics.
May 8, 2006... Mortgages are off to a rough start in May primarily due to all the curve gyrations and yield backup. This was caused, in part, by Federal Reserve Chairman Ben Bernanke's comments to CNBC correspondent Maria Bartiromo at a White House...

Freddie Mac reports a significant rise in first quarter cash-out share.
May 8, 2006... Freddie Mac reported last week that in the first quarter of 2006, 88% of Freddie-owned loans were refinanced into new mortgages with loan amounts that were at least 5% higher than the original loan. This compares to 81% in 4Q05, and is the...

CMBS investors predict sunny skies ahead.
May 8, 2006... More securitizations backed by commercial mortgages are outstanding than ever before. This has caused a surge in the number of CDOs backed by these loans, putting more pressure on rating agency analysts to review the transactions. Issuers and...

Limited growth expected from condo conversion CMBS market.(Commercial Mortgage Backed Securities)
May 8, 2006... Condo conversions are an undisputedly hot sector of the real estate industry. Last year the market seemed to come of age, after JPMorgan Securities managed the first condo conversion securitization in May 2005. Credit Suisse First Boston...

Onshore existing assets become Russia's main attraction.
May 8, 2006... Russia's potential is becoming synonymous with existing assets. Traditionally in emerging markets, offshore future flows provide the opening theme of the cross-border securitization story - only after significant activity and a good deal of...

Wave of RMBS signals a deluge of European deals.(Residential Mortgage-Backed Securities)
May 8, 2006... The April holidays led to less-than-impressive European primary issuance. Year-to-date issuance is up only 4% over the same period last year. According to analysts at the Royal Bank of Scotland, total issuance for April this year was at 13.0...

Members Equity leads Aussie activity.
May 8, 2006... Members Equity, one of Australia's most active issuers, has launched the latest prime RMBS from its SMHL program. Deutsche Bank and Macquarie Bank are joint lead managers on the A$1 billion ($766.5 million) transaction. The deal is backed...

New Zealand company issues third RMBS.
May 8, 2006... Moving across the Tasman Sea to New Zealand, Bluestone Group has completed its third NZ$-denominated nonconforming RMBS. Issued through the Sapphire facility and arranged by Westpac, the NZ$241.8 million ($152.3 million) offering was placed...

Agricultural Bank of China confirms ABS plans.(asset backed securities)
May 8, 2006... Agricultural Bank of China (ABC) - one of the People's Republic's Big Four' state-owned commercial banks - last week announced its intention to begin a trial securitization program later this year. The bank, which manages 13% of China's banking...

FSA punishes Shinsei for real estate-related activities.(Financial Services Agency)(Shinsei Trust & Banking Co.)
May 8, 2006... Japan's Shinsei Trust & Banking Co. has become the second financial institution in as many months to be punished by regulators for activities related to its real estate securitization group. The Financial Services Agency (FSA) imposed a...

Whispers.(Najib S. Canaan resigned from Nomura Securities Company Ltd.)(BNP Paribas S.A. hired Christos Danias)(Merrill Lynch and Company Inc. hired Joe Pedlow and Jerome Anselme )
May 15, 2006... Starting in 2007, Information Management Network's yearly ABS conferences will no longer be known as the ABS West or East conferences. Starting this spring, instead of the usual ABS West Conference typically held in Phoenix, IMN will stage the...

Commercial real estate REITs react to market.(real estate investment trusts)
May 15, 2006... Amid heightened competition, real estate investment trusts that operate within the commercial real estate sector are employing a number of strategies - from teaming up to changing course. Several REITs in the first quarter admitted to...

ABS pitched to fund Fla. storm recovery.(asset backe securities)(Florida Power and Light Co.)
May 15, 2006... The Florida Public Service Commission's staff last week recommended that Florida Power & Light, a Juno Beach, Fla.-based utility company, be allowed to tap the securitization market for about $659 million. If the power company completes the...

ABS a la Mexicana.(asset backed securities)
May 15, 2006... A brisk securitization business in Mexico continues to beckon players from abroad, with monoline insurers, arrangers and even hedge fund investors unable to resist. Entrenched originators are spreading their roots further, while there always...

Wachovia embraces Golden West's option arms.(Wachovia Corp.)(Golden West Financial Corp.)
May 15, 2006... While eyebrows were raised last week at the timing of Wachovia Corp.'s purchase of savings bank and mortgage lender Golden West Financial Corp., Golden West Chief Executive Herb Sandler vehemently denies it had anything to do with his outlook...

Securitization for Sallie Mae's GHELP program not certain.(SLM Corp.)(Global Health Education Loan Program)(Brief article)
May 15, 2006... Sallie Mae rolled out a new loan program earlier this month, and although one official there said the lender had no existing plans to fund it through securitization, market players think otherwise. The student loan provider launched the...

Market resigns itself to quiet week, slower year for ABS issuance.(Asset backed securities)
May 15, 2006... Just like short-term spreads on several deals, the ABS primary market spigot tightened up a bit more last week, with just $4.2 billion in deals coming out by press time. Sluggishness in the subprime market was partially to blame, as well...

NewStar launches second CLO, opens San Fran Office.(NewStar Financial )
May 15, 2006... Middle market specialty finance company NewStar Financial has opened a new office in San Francisco in order to strengthen the firm's presence on the West Coast, specifically in California. The office is the fourth one opened by NewStar since...

Future flows of life settlement bonds discussed as insurance lobby looks to tighten premium financing.
May 15, 2006... Before the viatical settlement bond market was virtually shut down by then-unforeseen developments in drug therapies for AIDS patients, the National Association of Insurance Commissioners, or the NAIC, protected its own interests by enacting...

REIT status stifling subprime lenders?(Real estate investment trusts)(Novastar Financial Inc.)
May 15, 2006... A hedging strategy gone wrong at NovaStar Financial Corp. could have compromised its real estate investment trust status, according to company executives. This event might have had a more negative implication on the subprime lender than the...

Avenue Capital Group closes third CLO.(Collateralized loan obligations)
May 15, 2006... Dick D'Addario, senior portfolio manager at the New York-based investment firm Avenue Capital Group, and his colleagues have just closed a new $500 million collateralized loan obligation (CLO), their company's third such vehicle thus far. ...

FOMC wait quiets mortgage activity.(Federal Open Market Committee)
May 15, 2006... The mortgage market was a relatively quiet last week as participants were mainly on hold for the Federal Open Market Committee's midafternoon statement last Wednesday. The announcement failed to stimulate much reaction, and so the market's...

Citigroup looks at supply and demand in 30-year 6.5s.
May 15, 2006... Citigroup Global Markets analysts noted recently that 30-year 6.5s have recently underperformed and the dollar roll has dropped. Analysts said this might be caused by the threat of future origination as primary mortgage rates have moved higher...

Impact of mortgage convexity hedging examined.
May 15, 2006... With the market selling off, market participants are asking whether convexity hedging would have a relatively bigger impact on the shape of the curve compared to the level of rates. In a recent report, JPMorgan Securities analysts said that...

Freddie Mac announces expansions to mortgage products.(Federal Home Loan Mortgage Corp.)(Brief article)
May 15, 2006... CHICAGO -Last week, Freddie Mac announced that it was expanding the list of mortgage products available through its Web-based Selling System. The GSE is adding 40-year fixed-rate mortgages and more adjustable-rate mortgage products. These...

Mitchell & Butlers to go it alone.(finance)
May 15, 2006... The R20 consortium looking to purchase Mitchells & Butlers PLC withdrew its bid for the U.K. pub operator ahead of the May 8 deadline imposed by the Takeover Panel, the regulatory body that administers the city code on takeovers and mergers...

Turkey's Garanti comes back for more, tapping euros.(Turkiye Garanti Bankasi A.S.)(Brief article)
May 15, 2006... One of the most reliable suppliers of future flow volumes last year is back. After hitting up investors for over $1.4 billion in 2005, Turkiye Garanti Bankasi closed a 300 million transaction backed by diversified payment rights (DPRs) May 9...

Momentum builds ahead of Barcelona gathering.(Residential Mortgage-Backed Securities)
May 15, 2006... RMBS was once again the order of the week as the European pipeline continued to build with new deals coming from U.K. and continental issuers alike. There were no signs of market activity abating as issuers rushed to get their deals done before...

U.K. cards feel consumer pinch.(Credit card industry)
May 15, 2006... Following a less-than-stellar 2005, U.K. credit card securitization issuance looks poised for even weaker growth in 2006, as higher delinquencies and charge-offs mar the credit picture. Analysts at Fitch Ratings last week published a report...

Irish tax issue confirmed on a EU wide level.
May 15, 2006... No one was surprised last week when the European Court of Justice ruled to validate tax exemptions in Ireland. All the same, the industry welcomed this much needed clarification in the EU's disjointed tax environment, sources said. The...

No let up in Aussie RMBS market.(Australia)(residential mortgage backed security)(Pepper Homeloans)(Bank of Western Australia Ltd.)(National Australia Bank Ltd.)
May 15, 2006... Australia's residential mortgage-backed pipeline showed no sign of easing last week, with Pepper Homeloans, Bank of Western Australia (BankWest) and National Australia Bank (NAB) prepping deals, while Members Equity completed its first deal of...

Singaporean REIT prices first CMBS.
May 15, 2006... K-REIT, the real estate investment trust established by Singaporean developer Keppel Land, has priced its debut CMBS. Deutsche Bank was sole lead manager on the 97 million ($124.1 million) transaction, issued out of the Blossom Assets SPV. ...

Macquarie preps China CMBS.(Macquarie Funds Management Group)(commercial mortgage-backed securitization)
May 15, 2006... Australia's Macquarie Group was last week linked with what would be China's first commercial mortgage-backed securitization. According to local media, Macquarie is preparing a RMB1 billion ($124 million) deal that will be secured by its...

Indonesia deals with non-performing loans.(Mandiri Bank)(Brief article)
May 15, 2006... Indonesia's Bank Mandiri has been tied to securitizing bad loans in the past week. The state-owned bank - Indonesia's biggest in terms of assets - is exploring securitization and asset sales among other efforts to bring its non-performing loan...

Whispers.(appointments)
May 22, 2006... The FSA expects to wrap at least two securitizations in Mexico's domestic market this year, according to Eduardo Ramos, managing director of Latin America at Euromoney's Fifth Annual Securitization in Latin America Summit held in Miami last...

Court ruling highlights CDS confusion.(Centre de Donnees Astronomiques de Strasbourg )
May 22, 2006... What is being called a complete misunderstanding by a district court judge of a credit derivatives contract is causing some to question the clarity of credit default swap documentation. The Southern District Court of New York in February ruled...

The good times roll for LatAm issuers.(Latin American)
May 22, 2006... MIAMI - Latin American telenovelas often follow a Cinderella narrative: young heroine is poor and mistreated; she meets a moneyed suitor; she blossoms into a gorgeous creature and, when the show is over, into an obscenely wealthy global...

DPCs compete with monolines on CDOs.(derivative product companies)
May 22, 2006... In another sign of a booming CDO market, a handful of credit derivative product companies (DPCs) are cropping up and offering credit enhancement products similar to those offered by monoline bond insurers. In the last year, companies like...

Would-be ABS CDS parties bite nails at ailing standard.(asset backed securities)(Credit-Default Swaps (investing) )
May 22, 2006... LOS ANGELES - Despite the phenomenal surge in asset-backed securities credit derivative issuance, some West Coast market participants say they are wary to jump into either the single name or index markets until the sector can offer more...

CDO CDS doc development reaches roadblock.(collateralized debt obligations)(collateralized debt securities)
May 22, 2006... LOS ANGELES - As industry representatives work to form a standardized framework for trading credit default swaps that reference CDOs, perhaps the biggest roadblock to completion is how to handle the write-down provision of the swaps. A CDO is...

Preholiday week pickup marks an $11 billion ABS week.(Asset backed securities)
May 22, 2006... Despite damp and gloomy weather for much of last week, the ABS market appeared to get ready for the official start of summer. Issuance picked up the pace last week, with $11 billion in offerings at press time. "We are seeing an uptick in...

Florida Public Service Commission approves ABS deal for storm recovery.(asset backed securities)(Florida Power and Light Co)
May 22, 2006... After resolving a few accounting issues, including the costs of utility poles, the Florida Public Service Commission gave the go ahead for Florida Power & Light to finance its costs of storm recovery from 2004 to 2005 through a securitization...

Fitch to update interest rate stress model.(Fitch Inc.)
May 22, 2006... Fitch Ratings last week released for comment new interest rates stress criteria for structured finance transactions involving USD Libor. The key difference between the proposed methodology and the way Fitch currently applies interest rate...

DebtX awarded patent.(Brief article)
May 22, 2006... Loan sale advisor DebtX has been awarded a patent by the United States Patent and Trademark Office for its online loan sale and debt trading exchange program. This protects DebtX's innovations relating to due diligence, loan sales and debt...

United States Supreme Court declines to take appeal of Third Circuit's substantive consolidation ruling.(Owens-Corning Fiberglas Corp)
May 22, 2006... The non-consolidation of special purpose entities with the seller of financial assets is a prerequisite of every properly structured securitization transaction. On May 1, the United States Supreme Court denied the petition for a hearing...

Emerging revenue stream a potential asset for future ABS deals.(asset backed securities)
May 22, 2006... More consumers are using electronic disbursement services through the telephone and Internet to make last minute payments on credit cards, mortgages and other bills, according to a survey completed in April. The fees attached to such...

Fitch: Is U.S. Multiseller ABCP Risk Lower Than You Think?(Asset-Backed Commercial Paper)(Fitch Inc.)
May 22, 2006... Responding to market participants' demand for more precise and granular measures of risk, Fitch Ratings conducted a study of the level of program-wide credit enhancement (PWCE) with a sample of large, diverse multi-seller ABCP programs in the...

Carlyle makes new hires and completes mezz fund.(Carlyle Group L.P.)(Mezzanine financing)(John Stomber )(Matthew Cottrell )
May 22, 2006... The Carlyle Group announced last week that it has hired John Stomber as a managing director in the leveraged finance group in New York. Stomber previously worked at Cerberus Capital Management as a managing director focused on structured...

Months after closing, reviews are in for Gun Hill Road securitization.(Relativity Media.)
May 22, 2006... Gun Hill Road, a $600 million securitization of revenues from film copyrights, received decent reviews last seek. The positive feedback comes several months after Deutsche Bank underwrote the transaction last January. The bank is also preparing...

Babson closes fourth CDO Of CDOs.(Babson Capital Management)(Collateralized debt obligations )(Brief article)
May 22, 2006... Babson Capital Management has closed the Connecticut Valley Structured Credit CDO III, a $400 million collateralized debt obligation (CDO) that will consist primarily of BBB rated CDO debt securities with a focus on the collateralized loan...

S&P: fixed-rate, equity rich home loans could shore up RMBS in housing bubble.
May 22, 2006... While most industry participants have come to the conclusion that the U.S. housing market is unlikely to post rapid price declines on a nation-wide scale, Standard and Poor's last week released an updated simulation of how the RMBS market would...

Conner named as BMA counsel.(Bond Market Association)(Robbin Conner )(Brief article)
May 22, 2006... The Bond Market Association announced last week that Robbin Conner has been appointed vice president and assistant general counsel. Conner, who will report to BMA associate general counsel Lynnette Hotchkiss, will also be the staff advisor to...

CPI scare stalls better buying interest in mortgage market.(Consumer Price Index )
May 22, 2006... Mortgages continue to lag in May with month-to-date excess return through May 17 of -16 basis points, according to analysts at Lehman Brothers. This more than wipes out April's gain of 14 basis points. Year-to-date, however, excess return...

Fed releases April senior loan officer survey.
May 22, 2006... The Federal Reserve recently released its quarterly Senior Loan Officer Survey. Broadly, the survey reported a net easing in commercial and industrial (C&I) and residential mortgage lending while commercial real estate (CRE) lending standards...

Baby boomers drive bank deposits, Barclays said.
May 22, 2006... Baby boomers appear to have a considerable impact on the mortgage basis, said analysts from Barclays Capital in a report released last week "Demographic changes have been a big driver of bank deposit growth, and we believe this will continue,...

ESF launches new RMBS reporting package.(European Securitization Forum)(residential mortgage backed securities)
May 22, 2006... The European Securitization Forum last week issued their recently updated standardized reporting fields and definitions guidelines for European residential mortgage-backed transactions. The guidelines have been created to improve the...

Bulgarian bank debuts true-sale ABS deal.
May 22, 2006... ProCredit Bank Bulgaria (PCB) securitized part of its loan portfolio estimated at 100 million ($128 million). The transaction is a cash flow securitization of euro-denominated loans granted by PCB to small and medium sized (SME) Bulgarian...

Unique pub deal graces the European market.(Unique Pub Co.)(Asset backed securities)
May 22, 2006... The primary pipeline continued to churn out deals with the European ABS calendar registering a 23 billion ($29.13 billion) lineup of issues in the beginning of last week. Dealers began work for Globe Pub Issuer, a GBP257 million ($483...

CMSA-Europe expands office with new hires.(Commercial Mortgage Securities Association)(Ronan Fox )(Brief article)
May 22, 2006... In a testament to the booming European CMBS market, the Commercial Mortgage Securities Association-Europe is set to make two new hires to its London-based team. The expansion coincides with Ronan Fox officially taking over as the new vice...

Competition leads to more options at offshore centers.
May 22, 2006... With spreads tightening and less money to be made, securitization professionals are increasingly looking to reduce costs. This environment has driven market players to look for structuring alternatives that help run programs as cheaply as...

European market pays closer attention to CDO key-man risk.(Collateralized debt obligations)
May 22, 2006... The CDO business in Europe has been booming, and sources say a new structure is announced almost every week. European market players believe the CDO business will continue growing, given the high level of cash still floating about in...

PPPs arrive in Mexico with ABS tagging along.(Public-private partnerships)(Asset backed securities)
May 22, 2006... MIAMI - Public-private partnerships (PPPs) have arrived in Mexico and players at Euromoney's Securitization in Latin American Summit said they will provide fodder for ABS. PPPs are expected to cover a broad range of infrastructure...

IFC grows team, plans new product for Brazil.(International Finance Corp. )
May 22, 2006... MIAMI - Seizing on the multiplying opportunities in Latin America's domestic markets, the International Finance Corp. is growing its structured finance group, according to Lee Meddin, global head of structured finance for the private sector...

FIDC issues projected to hit R$22bn this year.(Federazione Italiana Della Caccia (Italian) )(Brief article)
May 22, 2006... MIAMI - No discussion of flourishing local currency issuance in Latin America would be complete without the much-ballyhooed FIDCs, the vehicle of choice for non real-estate securitizations in Brazil. Booming over the last few years, issuance of...

Whispers.(appointment)
May 29, 2006... In one of the more significant Asian moves in recent times, UBS's longstanding head of Asian securitization Anthony Cutcliffe has switched to a new position with the bank's principal finance group. UBS has not yet appointed his successor....

MBS market pros see limited impact after OFHEO reprimands Fannie Mae.(Mortgage backed securities)(Office of Federal Housing Enterprise Oversight)
May 29, 2006... Although some residential MBS market professionals said the Office of Federal Housing Enterprise Oversight (OFHEO) came down a bit severely on Fannie Mae last week, they say the agency's disciplinary recommendations will not materially impact...

DPR deals shrug off turmoil - for now.(diversified payment rights)
May 29, 2006... Emerging markets have stumbled into a volatile patch, with some leading stock indices and currencies down by double-digit rates over the last few weeks. But ABS from the Eurasian corner of the EM world seems undeterred, thanks in no small part...

Home price growth flounders in Q1.(refinancing their homes)
May 29, 2006... Early estimates for the first quarter indicate substantial downturns in a number of hot real estate markets, leading many to speculate as to how far prices will fall, and how severe losses in the price-sensitive subprime sector will be. ...

Ratings on RMBS land DBRS in public U.S. synthetic market.(residential mortgage backed securities)(Dominion Bond Rating Service Limited)
May 29, 2006... Dominion Bond Rating Service says it is inching into the U.S. synthetic RMBS and ABS sectors. Bank of America Corp. recently commissioned the Canadian rating agency to supply ratings to a pair of U.S. synthetic RMBS deals. These transactions...

Existing home sales slip.(popular prediction that the demand for homes will continue to slow down)(Brief article)
May 29, 2006... As economists accurately predicted, existing home sales in April slipped to a 6.76 million unit pace. Although this is approximately off 5% from the 2005 pace, it is near the 6.72 million unit pace for all of 2004, making the current reading...

U.S. primary ABS market springs into action with $13.6 billion in issuance.(United States)
May 29, 2006... From start to finish, the ABS market had an ambitious week, as dealers rushed to get deals out the door before a long, if not leisurely, weekend. The market produced a respectable $13.6 billion in new issuances by press time. "I would...

Emergence of new products up for discussion at ASF.(American Securitization Forum)
May 29, 2006... With the ever-expanding ABS market, the growth of new ABS products and asset classes will always be an important topic. At the American Securitization Forum annual meeting to be held next week, there would be a session devoted entirely to...

Texas power company surrenders last word on ABS to utility commission.(Asset backed securities)(Brief article)
May 29, 2006... AEP Texas Central Co., which is looking to raise as much as $1.7 billion through securitization, filed what it called a unanimous settlement agreement with the Public Utility Commission of Texas. The accord will hold them - and all other...

Prime auto ABS lead Fitch upgrade actions for April.
May 29, 2006... A bit of ageing becomes the prime auto ABS sector, according to Fitch Ratings. With 11 upgrades, the asset class dominated positive ratings movement activity for U.S. term ABS in April. The upgrades came on five transactions sponsored by...

Lehman: structural safeguards insulate private student loan ABS from severe prepay risk.(asset backed securities)(cash capitalization accounts)
May 29, 2006... Overcollateralization, excess spread and the presence of cash capitalization accounts (CCAs) on certain deals provide ample protection against prepayment losses on private student loan ABS deals, Lehman Brothers found after a test analysis on a...

Moody's to update hedge framework.
May 29, 2006... Swap counterparties in deals rated by Moody's Investors Service may see the amount of collateral they're required to post decrease, thanks to new guidelines the rating agency plans to adopt. Cash flow deals issued after Sept. 1, which have...