Asset Securitization Report articles from November 2006

Asset Securitization Report archives from November 2006

Whispers.(New Century Financial Corp. appointed Taj Bindra)(Bridger Commercial Funding appointed Rhonda McGovern)(Aladdin Capital Management launched securitization fund)
November 6, 2006... Subprime mortgage lender New Century Financial Corp. tapped Taj Bindra, Washington Mutual's executive vice president of mortgage banking, capital markets and servicing operations to replace Patti Dodge, its chief financial officer. Bindra's new...

IMN conference to tackle new products, highlight ABCP.(Information Management Network)
November 6, 2006... More than 3,000 industry attendants are expected at the JW Marriott/Ritz Carlton Grande Lakes Resort, for this week's Information Management Network twelfth annual ABS East conference. Participants are expected to grapple with industry...

CDOs eat excess HEL spread.(collateralized debt obligations)
November 6, 2006... As expected, CDO managers feasted on the recent bout of asset-backed credit default swap spread widening - producing a two-fold effect of reeling spreads back in and pushing the burgeoning CDO pipeline out. Mezzanine structured finance...

CPDO: The new kid on the block.(constant proportion debt obligations)
November 6, 2006... ABN Amro, an innovator in CPPI structures, has underwritten what is likely the first CDO deal with constant proportion debt obligations (CPDOs). A variation of CPPI deals, CPDOs help revise some of the rating and valuation challenges posed by...

Emporia opens Los Angeles office.(Emporia Capital Management)(Brief article)
November 6, 2006... Cohen & Co. last week opened a Los Angeles office for its middle market loan and CLO collateral management unit Emporia Capital Management. Cohen snagged David Ligon and Gary Kirshner from Union Bank of California, where they were group heads...

Market sees debut of insurance-linked notes to finance disability claims.(Unum America)(Tailwind Holdings LLC)
November 6, 2006... UnumProvident Corp., a group and individual disability insurance provider, completed an insurance-linked ABS deal backed by premiums on long-term disability insurance policies. Proceeds from the transaction will finance a portion of the...

IMN conference preparations subdue ABS market activity.(Information Management Network)(asset backed securities)
November 6, 2006... Trading on the ABS market was fairly light last week, as more than 3,000 market professionals prepared to head out to Orlando, Fla for Information Management Network's ABS East conference. By midweek, about $10 billion in deals were announced,...

Cautiously, Mizuho Bank wades deeper into ABCP waters.
November 6, 2006... Working Capital Management Co., a fully supported asset-backed commercial paper conduit sponsored by Mizuho Corporate Bank, raised its purchase limit to $5 billion, from $3 billion. While it is not expected to substantially impact the ABCP...

CDO modeling based on past performance: Is it possible?(Collateralized debt obligatons)
November 6, 2006... Wachovia Securities CDO analysts last month sought to find a new way to answer an old question: Is there a method to project future new-issue CDO performance using historical data? Their ultimate finding was yes, although with some caveats. ...

Lower expected bankruptcy filings emerge from mixed consumer debt picture.
November 6, 2006... One year after bankruptcy reform legislation passed - changing the rules for who can file for bankruptcy and how it must be done - bankruptcy filings have stayed lower for longer than analysts expected. Filings are expected to average 12,000 to...

Cash-out refi activity highest since 1990, says Freddie Mac.
November 6, 2006... A full 89% of Freddie Mac-owned loans that were refinanced resulted in new mortgages with loan amounts that were at least 5% higher than the original loan, according to Freddie Mac's third quarter cash-out refi report. This compares to 88% in...

Servicer buying picks up as market rallies sharply on weak data.(Lehman Brothers)
November 6, 2006... October was a good month for the mortgage sector. According to Lehman Brothers, the MBS Index gained 25 basis points in excess return versus Treasurys. Year-to-date, mortgages have outperformed by 86 basis points. So far, this year is turning...

Conduit pipeline growing as market wraps up October deals.
November 6, 2006... Fixed rate U.S. conduit issuance in CMBS finished up at $12.62 billion on four deals for the month of October. The deals varied in size from $1.5 to $4.2 billion, with triple-A super senior spreads trading in a range of 21 to 23 basis points...

Barclays: Buy FNCL 6.5, sell FNCL 5.5.
November 6, 2006... I investors should buy FNCL 6.5 while selling FNCL 5.5, duration hedged with 10-year swaps, Barclays Capital analysts said last week. They also suggested for buyers to unwind existing FNCL 5.5/FNCL 6 trades. Analysts noted that housing...

La Salle to offer electronic vault for loan documents.
November 6, 2006... LaSalle Bank has created an electronic vault for mortgage documents, which it says will speed the sale of mortgage-backed securities. Harry Cicchetti, LaSalle's senior vice president of collateral services, said the vault should let Wall...

CMBX rolls for the first time.(Brief article)
November 6, 2006... The synthetic index for CMBS bonds rolled for the first time last week, ushering in several changes that are anticipated to make the indices more liquid. Investors in the new CMBX.2 will now have the ability to reference the double-B tranches...

Lehman looks at potential trades with hybrids in MBS Index.
November 6, 2006... As Street research analysts have been highlighting recently, interest and activity in the hybrid ARM sector has been picking up since Lehman Brothers indicated it would be including its Hybrid ARM Index into the MBS Index on April 1, 2007. ...

After the RMBS flood, more RMBS.(residential mortgage-backed securities )
November 6, 2006... The deluge of RMBS paper at the end of October has done little to sway pricing away from tight levels. According to market reports, October's volume reached a new all-time record of over 70 billion ($89.26 billion). However, as the month came...

International investors opt for Euro govt bonds and CDOs.
November 6, 2006... Non-E.U. investors are most present in Europe's government bond and CDO markets, according to a recent survey of investor trends in European debt by The Bond Market Association. TBMA surveyed 20 leading book runners of European bonds to...

Market spreads expected to hold, survey finds.
November 6, 2006... European investors are generally optimistic about securitization market fundamentals, revealed Citigroup's European securitized products investor survey. As a result, a large majority of the investors polled intend to further increase their...

StanChart consortium wins Thai energy mandate.
November 6, 2006... With stability returning to Thailand following recent political unrest, Petroleum Authority of Thailand (PTT) and the Ministry of Energy last week awarded the mandate for their joint CMBS to a group comprising Bangkok Bank, Standard Chartered...

Lloyds delivers a double shot from its loan book.
November 6, 2006... Lloyds TSB sold its first securitization of corporate loans last week, a first step in its strategy to use complex derivatives to shift risk off its balance sheet, the bank said. The GBP1 billion ($1.9 billion) CDO is a synthetic, fully...

Metrofinanciera makes news, but not all of it's good.
November 6, 2006... Mexico's Metrofinanciera has been attracting a good deal of attention lately. The real estate finance company has entered a non-binding agreement to acquire peer Credito y Casa, a venture that has put Metro's groundbreaking cross-border RMBS on...

Taken offshore, Brazilian FIDC snapped up by hedge funds.(receivable investment fund )
November 6, 2006... The appetite for straight Brazilian exposure among risk-seeking foreign investors appears to be hearty. Union National recently sold to about 15 hedge funds R$350 million ($163 million) in a receivable investment fund (FIDC) backed by...

Mexican banks look to RMBS field, Banorte registers deal.
November 6, 2006... Banks in Mexico are no longer ceding the RMBS arena to nonbank real estate companies known as Sofols. Banco Mercantil del Norte (Banorte) recently registered a Ps10 billion ($925 million) RMBS program, which is being led by the brokerage arm of...

Macquarie launches PUMA deal.
November 6, 2006... Australia's most active issuer - Macquarie Securitisation - will launch this week the latest offering from its PUMA RMBS program. The company has hired its parent, Macquarie Bank, Citigroup Global Markets and Deutsche Bank as joint leads on the...

Whispers.(Juliet Jones appointed at Barclays Capital)(Bank of Tokyo-Mitsubishi UFJ to launch ABS trading platform )(Deutsche Bank to launch second CMBS-backed CDO )
November 13, 2006... Juliet Jones, a senior ABS analyst at Barclays Capital, is moving from the bank's securitization research group to portfolio management. Beginning Wednesday, Jones will manage Barclays Capital's multibillion-dollar ABS portfolio. She will...

Investors confident in residential MBS, consumer ABS classes.(mortgage backed securities and asset backed securities)
November 13, 2006... Orlando, Fla. - American consumers are still enjoying the golden age' of credit, which should buoy their fortunes - and that of the ABS market - in the face of uncertainty surrounding the housing market and a mixed outlook on the economy. ...

CDOs vulnerable to private equity.(collateralized debt obligations)
November 13, 2006... Leveraged financing is fuelling a significant expansion of the European private equity market. But the increasing level of debt used to finance private equity deals could leave transactions exposed to certain weaknesses in the event of a...

ISDA tackles counterparty row.(International Swaps and Derivatives Association)
November 13, 2006... The International Swaps and Derivatives Association (ISDA) is still looking for a council of experts that could help mitigate disagreements between credit default swap counterparties about what constitutes a deliverable obligation. While...

Investors eye higher credit amid poor HEL performance.
November 13, 2006... As evidenced by the growing CDS of CDO market, investors are becoming increasingly bearish on not only subprime mortgages issued in 2005 and 2006, but also on the CDOs that are buying the bonds backed by them. While rating agency sources say...

ABS issuance slows as professionals head to IMN to broker deals.
November 13, 2006... Securitization professionals spent most of last week networking at Information Management Network's ABS East conference, virtually silencing their trading floors at home offices. Out of an expected $14 billion in issuance, less than $300...

IMN gears up for Spring ABS 2007.(Information Management Network)(Spring ABS 2007)(Brief article)
November 13, 2006... City night life, beaches - and oh, yes, cutting edge securitization business - await delegates at Information Management Network's upcoming inaugural Spring ABS 2007 in South Beach, Florida. Commencing on April 29 and running for four days, the...

ABS pros discuss pool quality control, debate value of triggers.
November 13, 2006... Orlando, Fla - Practices for assembling and implementing quality control on home equity loan pools are shifting dramatically on Wall Street, putting more onus on investors - and dealers sometimes - to do more due diligence on the ABS pools that...

Economic bulls and bears lead lively morning panel.
November 13, 2006... Orlando, Fla. - If the Starbucks coffee didn't wake up delegates who attended the early morning economist roundtable at Information Management Network's ABS East conference held here last week, then the lively interaction between panelists and...

Industry experts give would-be ABS issuers a lay of the land.
November 13, 2006... Orlando, Fla.- ABS analysts, traders and deal managers at Information Management Network's ABS East conference held here last week got into deep discussions about complex deal structures, regulatory issues and industry moving trends. But...

Panelists zero in on Reg AB.(Regulation AB )(Discussion)
November 13, 2006... Orlando, Fla. - Regulation AB was obviously the talk of the town at the Information Management Network ABS East conference held here last week. Delegates were swarming to the sessions to catch up on the latest developments. To demonstrate...

New ABS poses a challenge to first-time issuers.(Conference news)
November 13, 2006... Orlando, Fla. - Issuers who want to bring new or esoteric asset classes to market should consult with rating agencies early on in the process, according to participants at the twelfth annual Information Management Network ABS East conference...

Derivative product to drive volume in 2007.(collateralized debt obligations)(Conference news)
November 13, 2006... Orlando, Fla. - Although the participants at the opening panel of IMN's conference were generally predicting a dip in ABS volume for 2007 - from 5% to 10% - they said that derivative product will drive issuance going forward. The market...

Better buying in higher yield range.
November 13, 2006... Mortgages performed well last week as the previous week's sell-off moved the market to a higher yield range. The 10-year yield moved above 4.70% following the strong revisions made to the employment report after falling to 4.57% on Nov 1. While...

Egg credit card woes slated to be resolved in early 2007.
November 13, 2006... Egg's troubled outstanding securitization bonds under its Pillar Funding series (ASR,10/30/06) could see some relief, following statements from the seller that it plans to implements new accounting measures by early next year. In a press...

CMSA-Europe hosts Rome CMBS conference.(commercial mortgage backed securities )(Conference news)
November 13, 2006... CMSA-Europe kicked off its second annual European conference in Rome last week to a growing audience that has expanded to include more U.S. participants. Despite conflicting with Information Management Network's ABS East show, organizers at the...

European pipeline still growing strong.
November 13, 2006... The upward trend in European issuance remains unstoppable. As evidence, by the middle of last week, dealers were expecting at least 18 billion ($22.9 billion) of the 42 billion circulating in the new issues pipeline. Meanwhile, the RMBS sector...

Benchmarks set on largest Asian ABS.(asset backed securities)
November 13, 2006... Korea's Standard Chartered First Bank (SCFB), ex-Japan Asia's leading mortgage-backed issuer, has completed the region's largest ever cash securitization. SCFB's parent Standard Chartered Bank was sole lead manager on the $1.26...

Deutsche's head of Asian ABS leaves.(Brief article)
November 13, 2006... According to rumors surfacing in Asia last week, Deutsche Bank's head of Asian securitization Raj Shourie has left the bank. An official at Deutsche Bank declined to confirm or deny the rumor, stating only that the bank has a successful...

Standard Chartered launches third CLO.(along with Lehman Brothers Holdings Inc. launches collateralized loan obligations services)
November 13, 2006... Standard Chartered Bank (SCB) last week launched the third synthetic CLO from its Cayman Islands-registered Start SPV. SCB, listed in Hong Kong and London, is joint arranger on the $1.5 billion deal with Lehman Brothers. The two parties worked...

Whispers.(appointments)
November 20, 2006... BNP Paribas has created a new specialty finance group with its global fixed income securitization business. Paul Chivers - formerly from Deutsche Bank as managing director in its global markets structured credit trading team - has joined BNP to...

First downgrade for 2006 HEL vintage looms.
November 20, 2006... No matter which way one tries to rationalize it, subprime mortgages originated in 2006 are piling up delinquencies faster than some of the fiercest housing bears might have imagined. In fact, Moody's Investors Service earlier this month put on...

Baltimore to issue utility bonds.(Baltimore Gas and Electric Co)
November 20, 2006... Squeezed between revenue shortfalls resulting from deregulation of the power industry in Maryland and escalating capital spending and debt servicing needs, Baltimore Gas & Electric is planning a $635 million deferred energy balance ABS deal....

ABS CDS contracts under scrutiny.
November 20, 2006... Aside from one's long-term views on the U.S. housing market, the new and relatively untested nature of the ABS CDS market has some wondering whether investors will agree as to who owes what - along with when and how. While many strides are...

AXA in innovative catastrophic mortality ABS deal.(AXA Group)(IXIS)(Lehman Brothers Holdings Inc.)
November 20, 2006... AXA Cessions, the reinsurance entity of financial protection and wealth management group AXA Group, completed a $442 million securitization of catastrophic mortality risk last week. The 144A transaction, which closed on Nov. 9, is...

Ample primary market issuance smothers spreads on initial HEL deals.
November 20, 2006... Wedged between a conference week that emptied structuring offices and trading desks, plus the upcoming Thanksgiving holiday, the securitization market rolled up it sleeves to make last week count. By press time, market professionals expected to...

Analysts' outlook remains positive for auto ABS in 2007.
November 20, 2006... Despite last year's delinquency spike, the effects of hurricanes Katrina and Rita as well as increased charge-off rates in subprime auto loan portfolios for September, analysts expect the auto loan ABS sector to make a strong finish for 2006....

Driven by deals issued in the fourth quarter, European auto ABS volumes rise.
November 20, 2006... After a relatively quiet start to the year, auto securitization volumes kicked into overdrive in early October and market sources said it's likely to continue throughout the fourth quarter. The auto ABS market has been falling into near...

Putnam offers unique strategy for structured finance investing.
November 20, 2006... Structured finance may not always be an easy feat to tackle for pension funds, endowments and foundations and Taft-Hartley plans, but if you mix one part sophistication with one part Putnam Investments' Structured Opportunities strategy, you'll...

Inflation news, FOMC minutes stimulate MBS market.(Federal Open Market Committee )
November 20, 2006... Last week's trading sessions were primarily influenced by the inflation news and the Federal Open Market Committee minutes. Both the PPI and CPI reports showed an improvement in inflation. The overall PPI plunged 1.6% in October, versus a...

OFHEO releases procedures for 2007 conforming loan limits.(Office of Federal Housing Enterprise Oversight)
November 20, 2006... The Office of Federal Housing Enterprise Oversight announced last Wednesday that any downward revision to the 2007 conforming limits that are due to dropping home prices would be deferred for one year. This means that, contrary to earlier...

Mortgage rate falls, reports FHLMC survey.(Federal Home Loan Mortgage Corporation)(Brief article)
November 20, 2006... The 30-year fixed mortgage rates fell to 6.24% last week from 6.33% in the previous week, according to Freddie Mac's primary mortgage survey results. This is the lowest mortgage rates have been since the week ending March 3, 2006. In addition,...

Forecast gloomy for Italy's real estate deal.
November 20, 2006... The Italian real estate transaction - SCIP 2 - faced further collection shortages, exposing the transaction to downgrade risk. Last week, Fitch Ratings placed the class A5 and class B2 notes on ratings watch negative following reports of lower...

HKMC launches RMBS.
November 20, 2006... Hong Kong Mortgage Corp. (HKMC), the state-controlled secondary mortgage agency, last week launched the latest RMBS from its Bauhinia program. HSBC is arranger on the HK$2 billion deal, which is the first not to feature an unconditional...

Russian future flows return with Alfa, MDM.(Alfa Bank)(MDM Bank)(Merrill Lynch and Company Inc.)
November 20, 2006... Before last week, a consistently muscular showing from Russia's existing assets had knocked future flows from the country out of the ring. Now two issuers, MDM Bank and Alfa Bank, are hitting back with transactions backed by diversified payment...

New issues continue to be order of the day in Europe.(Hongkong and Shanghai Banking Corporation Ltd.)(Industriekreditbank AG-Deutsche Industriebank, Dusseldorf/Berlin)(Deutsche Bank AG)(mortgage backed securities)
November 20, 2006... There was little pricing activity in the week, although this did nothing to deter new issues from hitting the pipeline. Underwriters began showcasing Rubino Finance, the 61.5 million ($78.7 million) securitization of contributions owed by...

Brazil's FIDC market expands to absorb Sao Paulo commuters.
November 20, 2006... Train commuters in Brazil's megalopolis of Sao Paulo will shortly be connected to the country's ever-expanding world of structured finance. A receivable investment fund (FIDC) from Companhia Paulista de Trens Metropolitanos is currently in...

CRE CDOs come to Europe.
November 20, 2006... Morgan Stanley later this month is expected to close the first European CRE CDO, to be managed by BlackRock Financial Management. The 343 ($435 million) deal is the first in a string of expected CRE CDO issuance in Europe. The notes,...

Citigroup launches trade finance ABS.(Citigroup Global Markets Inc.)(asset backed securities)
November 20, 2006... Citigroup Global Markets last week launched its first asset-backed deal collateralized by trade finance receivables from what could be an ongoing program. The bank is self-arranging the $198.9 million transaction, issued out of the...

Fitch optimistic on Chinese ABS.
November 20, 2006... At Fitch Ratings' Global Structured Finance Conference held in Beijing last week, the rating agency was bullish about the prospects for China's emerging securitization market in 2007. So far, the officially recognized pilot securitization...

Aussie market on course to smash record.
November 20, 2006... Australia's securitization market in 2006 has already established a new record for issuance with two months in the calendar year remaining. According to Standard & Poor's, volumes for the first 10 months of the year totaled A$65 billion ($49.7...

Whispers.(GE Commercial Finance appointed Michael McGonigle)(Blackstone Group acquires Equity Office Properties )(ABN Amro closes securitization natural catastrophe risk)
November 27, 2006... GE Commercial Finance has appointed Michael McGonigle as managing director of trade accounts receivable securitization within its corporate lending business. McGonigle will head up the team that focuses on providing financing of $75 million or...

2006 HE ABS vintage: the worse ever?(Fremont Investment and Loan)(asset backed securities)
November 27, 2006... Judging by the types of loans it is no longer originating, subprime lender Fremont Investment & Loan may have a house recipe sure to provide a healthy portion of early payment defaults: begin with a stated income 80/20 combo loan, mix in a...

Russian bank preps Ruble MBS.(mortgage backed securities)
November 27, 2006... In the past few quarters Russia has raced past one milestone in structured finance after another. The most recent is a ruble-denominated RMBS. Arranged by Gazprombank and backed by a geographically diverse pool, the RUR3 billion ($113 million)...

U.K. mortgage lending sees growth.
November 27, 2006... U.K. mortgage lenders are quickly adjusting lending criteria to serve first time home buyers. For instance, HBOS and Abbey National this month announced plans to launch new, higher LTV mortgages aimed at these borrowers. However, going down...

CPDO and ABX: A well-suited match?(collateralized debt obligations)
November 27, 2006... You knew it was coming. Several CPDOs that reference the ABX.HE indices are in the oven, according to industry sources. Just a short time after this type of deal's debut, the CPDO structure - a new spin on CPPI - is garnering a lot of...

New ISDA auction protocol this week.(International Swaps and Derivatives Association)(Dura Automotive Systems Inc.)
November 27, 2006... Investors synthetically referencing the recently bankrupt U.S. auto parts manufacturer Dura Automotive Systems, for the first time this week, will use the International Swaps and Derivatives Association's (ISDA) revamped auction protocol....

Structured Finance Advisors getting back into CDO waters.(Collateralized debt obligations)(Structured Finance Advisors Inc.)(Brief article)
November 27, 2006... Structured Finance Advisors, one of the industry's earliest CDO pioneers, is soliciting equity buyers for a $1 billion high-grade ABS CDO that it is putting together. The unusual deal taps mostly high quality ABS assets, which carry mainly...

PMI Guaranty fills the second loss position gap.
November 27, 2006... The PMI Group created PMI Guaranty because it saw the need to serve the whole credit spectrum. PMI Guaranty was formed to respond to a specific niche in the market - the second loss position. Traditionally, the PMI Group had been providing...

Quiet, mixed flows in mortgage market due to holiday week.(Thanksgiving holiday)(Statistical data)
November 27, 2006... Last week saw relatively quiet trading conditions with many participants out for the Thanksgiving break. Mortgage flows were mixed in the only two full trading days - Monday and Tuesday - with Monday seeing better buying and Tuesday, better...

MBS bank holdings remain unchanged despite large holding shifts.(Mortgage backed securities)
November 27, 2006... There were significant adjustments in bank mortgage-backed holdings over the third quarter, but the net effect on these holdings for the third quarter stays unchanged compared to the previous one. In a JPMorgan Securities report released...

Spreads still widening with CMBS deal deluge.(commercial mortgage backed securities)
November 27, 2006... Spreads in the intermediate to longer triple-A sectors continued to gap out as a significant amount of CMBS has been coming to market this month. For instance, at the start of last week, two more fixed rate deals priced - adding another $5.5...

Turkey's Yapi Kredi looms with hefty $750 DPR.
November 27, 2006... Four months after Yapi ve Kredi was heard buzzing about a potential securitization (ASR, 7/31/06), the Turkish Bank is launching a roughly $750 million, 5.5-year deal backed by diversified payment rights (DPRs). Led by Standard Chartered and...

Shift in ratings leads to new index at Fitch.(Fitch IBCA Inc.)
November 27, 2006... Fitch Ratings launched a new Index of Rating Change aimed at presenting a different perspective on rating migration that looks at the market as a whole, by asset class and in terms of the countries where these assets are domiciled. "By...

Su Casita's fixed-peso RMBS tightens 2nd time around.(Residential Mortgage-backed Securities)
November 27, 2006... Mexican issuance continues to move at a good clip. Recurring market visitor Su Casita closed its second fixed-peso RMBS via Credit Suisse on Nov. 16 for a total Ps703 million ($64 million). With a 26-year legal final, the Ps621 million A...

Macquarie records tightest RMBS spreads.(Macquarie Securitisation)(Residential Mortgage-backed Securities)(Macquarie Securitisation Ltd. completes its latest Residential Mortgage-backed Securities program)(Mobius Financial Services completes its fourth public Residential Mortgage-backed Securities program)(Fitch IBCA Inc. report on Australian home-loan delinquencies )
November 27, 2006... Macquarie Securitisation, Australia's most active issuer, last week completed the latest RMBS from its PUMA program. Due to huge local and offshore investor support, the multicurrency deal was upsized from A$2.1 billion-equivalent ($1.6...

Samsung Card sets new mark for Korean ABS.
November 27, 2006... One of Korea's most active issuers and largest credit card companies, Samsung Card, has recorded the tightest spreads yet for an unwrapped cross-border ABS deal from the country. The $300 million private placement was arranged by Standard...