Asset Securitization Report articles from September 2006

Asset Securitization Report archives from September 2006

Whispers.(appointments)
September 11, 2006... Bryan Roberts recently left his position as director of European operations for Atlantic Information Services to return to the U.S. and join Deloitte & Touche's securitization services practice. At D&T, Roberts will be part of the team that...

Merrill Lynch to boost HEL ABS business with First Franklin buy.(First Franklin Financial Corp.)(asset backed securities)
September 11, 2006... Merrill Lynch's decision last week to acquire subprime lender First Franklin Financial Corp. swept yet another investment bank further into the loan origination business - a trend which some are coining as a "paradigm shift" within the maturing...

Churchill launches CLO initiative.(Churchill Financial Holdings)(collateralized loan obligations)
September 11, 2006... Middle market commercial finance company Churchill Financial Holdings last week announced plans to acquire CDO manager Centre Pacific LLC - a move that will create another player in the rapidly growing middle market loan CLO space. The...

WaMu in covered bond deal.(Washington Mutual Inc.)
September 11, 2006... Washington Mutual is preparing to price the first covered bond program by a U.S. issuer. While the transaction is not structured as a genuine securitization and is being marketed overseas, it is eventually expected to have implications on the...

Ballantyne Re bonds, so far, survive Scottish Re cataclysm.
September 11, 2006... Credit analysts see no reason - for now, at least - to downgrade the high-profile $2.1 billion Ballantyne Re securitization, despite the fact that the issuing entity, Scottish Re, suffered a series of downgrades that reduced its counterparty...

Insurance, student loan ABS highlight deals as market comes off hiatus.(asset backed securities)
September 11, 2006... Business in the ABS market continued to come out of its summer slowdown last week, as market players expected to see between $10 billion and $14 billion in new issues hit the market. As usual, the home equity securitization sector dominated...

Moody's implements LGD and PDR and publishes CLO request for comment.(loss-given-default assessments)(probability-of-default ratings)
September 11, 2006... Anticipating full execution in the market this month, Moody's Investors Service recently published the final methodology for loss-given-default assessments (LGDs) and probability-of-default ratings (PDR), as well as implementing the methodology...

Nomura: Synthetic CMBS offers exciting opportunities.(commercial mortgage backed securities)(Nomura Securities Company Ltd.)
September 11, 2006... Derivative contracts that reference commercial mortgage loans held by third parties could be the next evolution within the growing synthetic CMBS market, according to a report issued last week by Nomura Securities. A deal using such contracts...

Market players take a closer look at new FHLMC disclosures.(Federal Home Loan Mortgage Corp.)
September 11, 2006... Freddie Mac last month started providing monthly loan-level updates on its single-family mortgage PC securities issued after Dec. 1, 2005. Industry participants applauded the move because the increased disclosure allows for better understanding...

Mortgages benefit from tightening in swap spreads.
September 11, 2006... Mortgages are off to a strong start in September. According to Lehman Brothers, the MBS Index has outperformed versus Treasurys by 11 basis points month to date through Sept.6, and brings year-to-date gains to 80 basis points over. ...

OFHEO and Freddie Mac report sharp slowing in home price growth in second quarter.(Office of Federal Housing Enterprise Oversight)
September 11, 2006... Last Tuesday the Office of Federal Housing Enterprise Oversight released its quarterly report on home price appreciation for the second quarter. Appreciation for the quarter was 1.17%, or 4.68% annualized. This is down from 2.2% (8.78%...

FTN remains bullish on the relative value of 15-yr sector.(FTN Financial analysts)
September 11, 2006... There is relative value in the 15-year sector versus 30-year MBS, said FTN Financial analysts in a report that examined 15-year performance under different market scenarios. In the bond market rally of the past six weeks, 30-year MBS has...

Jumbo U.K. RMBS deals join September's pipeline deluge.(Arran Mortgage Funding program)(residential mortgage backed securities)
September 11, 2006... European primary market RMBS issuance has been light in recent weeks, which is typical for the month of August. Only three mortgage securitizations have come to market in the past month. However, these includes the third largest multi-currency...

Pub tap leads to upgrade.
September 11, 2006... Mitchells & Butlers announced the refinancing of its securitization last week. The additional debt raised will be used to fund the acquisition of a GBP497 million ($942 million) pub portfolio from Whitbread and to return cash to shareholders....

S&P and Fitch give Egg Banking a break.
September 11, 2006... Following Moody's Investors Service (ASR, 08/21/06) decision to place most of the junior classes issued by Egg Banking's Pillar Master Trust on review for downgrade, Fitch Ratings and Standard & Poor's have been slower to react. The rating...

U.K. nursing home sale leaseback transactions age gracefully.
September 11, 2006... Fitch Ratings recently upgraded the junior bonds of two sale leaseback nursing home securitizations - U.K. Care No. 1 and PHF 1 Securities No. 1. The rating agency cited improvements in operating performance. Fitch also affirmed the junior...

More light shed on the impact of U.K.'s smoking ban.
September 11, 2006... With the upcoming blanket smoking ban in England, market analysts are looking into what effects the ban is having on neighboring Scotland to get some notion as to how a similar one would affect trade for English pubs. So far, the prognosis...

Market gearing up for a busy September, after summer hiatus.
September 11, 2006... After a relatively slow end of August, the European ABS market is gearing up for what is set to be a busy September. Already in the first week of this month several deals are in the works as market players return to their desks after going on...

Offshore law firms finalize merger.(Appleby Spurling Hunter merged with Bailhache Labesse )(Brief article)
September 11, 2006... Offshore law firms Appleby Spurling Hunter and Jersey-based Bailhache Labesse formally completed their merger on Sept. 1. The law firms first announced their intention to join forces under the name Appleby Hunter Bailhache in May 2006. The...

U.K. RMBS show slight improvement, Fitch says.
September 11, 2006... According to the Fitch Ratings U.K. Non-Conforming Index, U.K. non-conforming RMBS deals showed a slight improvement in 2Q06. But analysts said that these improvements in arrears levels need to be considered in the context of the rise in sold...

Credit Suisse hire signals Asian intent.(Credit Suisse Group)
September 11, 2006... Credit Suisse has moved to regain some lost ground in the ex-Japan Asia securitization scene, which stagnated after the departure of Greg Park as its head of Asian ABS in June 2004 (ASR, 06/14/04). The bank has transferred Stella Tansengco...

Real estate and aircraft deals line up in Asia.
September 11, 2006... Two commercial mortgage-backed offerings out of Singapore were set to price as of press time. CapitaCommercial Trust (CCT) and CapitaMall Trust (CMT) - the real estate investment trusts managed by Singaporean property developer and the...

Australian asset-backed pipeline heats up.(Interstar Wholesale Finance)
September 11, 2006... It is set to be a busy September for the Australian market, with several transactions in the pipeline. Among those set to close deals are ANZ Bank, St. George Bank and Interstar Wholesale Finance. The most significant offering is...

Whispers.(briefs)
September 19, 2006... Cadwalader, Wickersham & Taft announced the hiring of seven special counsels, including Steven Hodaszy and Craig Wolson to its capital markets department. Hodaszy, who was previously at Sidley Austin and who will be based in New York, will...

How much longer will the CDO machine feast on U.S. RMBS?(collateralized debt obligations)(residential mortgage backed securities)
September 19, 2006... The torrid pace of deals churning from the industry coined "CDO machine" this year is making last year's record issuance look like a warm-up round. Total dollar volume in the U.S. CDO market was up 96% in the first eight months of this year...

Russia forum lays down law.
September 19, 2006... NEW YORK - At the Russian Structured Finance Investment Forum held here last week, speakers pointed up the legal uncertainties that hang over structured deals from one of the securitization world's most promising corners. With the true sale...

Louisiana power plans ABS.(asset backed securities)
September 19, 2006... The Louisiana Public Service Commission (LPSC) last week appointed a roster of financial advisors, energy consultants and legal counsel to structure a deal that would allow Entergy Corp. to raise $690 million in securitization debt. The New...

Blockbuster U.K. mortgage deals tip scales at the market.
September 19, 2006... Investors from all corners of the ABS market, especially those from Europe, came out in full force last week. With such demand for ABS paper, market players expected the week's deal tally to reach $20 billion. RMBS issuers from the U.K.,...

S&P to begin publicly rating credit default swaps.(Standard & Poor's Corp.)
September 19, 2006... Standard and Poor's late last week said it will begin assigning so-called "swap risk ratings" upon request to all rated credit default swaps - primarily those in the global synthetic CDO sector. The move highlights both efforts toward...

At half-year mark, ABCP market in formation-driven growth.(asset backed commercial paper)
September 19, 2006... Citibank held onto its spot as the largest ABCP program administrator, with $83.9 billion in paper issued from its 13 programs at the end of the first quarter, according to Moody's Investors Service, which published its mid-year review of the...

Global growth prompts changes in JPMorgan ABCP programs.(asset backed commercial paper)(J.P. Morgan Chase and Co. (New York, New York))
September 19, 2006... Hoping to align its asset-backed commercial paper programs for anticipated growth in the global market for asset-backed commercial paper, JPMorgan Chase is making several changes to its conduit programs. One strategy involves transferring...

Cohen changes name to fit its growing firm.
September 19, 2006... In a move designed to "reflect the expanding capabilities of its entire organization," Cohen Brothers & Co. last week announced it had changed its named to Cohen & Co. Chris Ricciardi earlier this year left as head of CDO origination and...

Prime and subprime autos make record improvements.
September 19, 2006... Net loss rates on securitized prime and subprime auto loans improved dramatically during the second quarter of 2006, thanks to steadily falling unemployment rates and rising values on used cars, according to Moody's Investors Service. ...

NYLIM continues diverse investment strategies.(New York Life Investment Management)
September 19, 2006... New York Life Investment Management (NYLIM), an asset management firm headquartered in New York, follows a diverse multi-asset class platform in order to maximize returns for its investors. Formed in 2000 as a subsidiary of New York Life to...

Market players suspicious of FAS 155 impact.(Financial Accounting Standards )
September 19, 2006... Earlier this year, the Financial Accounting Standards Board released FAS 155, Accounting for Certain Hybrid Financial Instruments. This was an update to the earlier FASB pronouncements (Statements No. 133 and 140) dealing with the accounting...

Delivery of FNMA mega pool rattles market.(Federal National Mortgage Association)
September 19, 2006... Mortgage flows were generally light as the market waited for late week data, particularly Friday's CPI report. Starting midweek, servicers and fast money were moving down in coupon as the market strengthened. There were pockets of buying from...

August prepays below consensus.(Federal National Mortgage Association)(Government National Mortgage Association )
September 19, 2006... August prepayments increased slightly less than expected at 8% to 9%, versus a consensus forecast of around 10%. While the aggregate number is uneventful, the breakdown is a bit more interesting. For example, speeds on FNMA 4.5% and 5% coupons...

Wachovia builds European CDO platform.(Wachovia Securities)(Collateralized debt obligations)
September 19, 2006... Wachovia Securities is extending its U.S. global rates and CDO platforms into Europe. The bank has made a number of hires both within its London-based global rates group and in Germany to support its growing European commercial real estate...

Busy primary takes to the fore front in Europe.
September 19, 2006... The European primary market continued to build last week, promising a busy fall. While the tightening bias has continued into September, with a heavy CMBS pipeline doing nothing to impact spreads on deals that priced last week, market players...

SME ABS volumes on the rise in Europe.(small and medium enterprice)(asset backed securities)
September 19, 2006... European securitization of SME financing has experienced strong growth since 1999. SME transactions reached 5.3% of total European ABS issuance in 2005; and in 2006 have represented 2.5% of euro asset-backed volume year-to-date. In a report...

Demica moves its European know-how stateside.
September 19, 2006... As a younger securitization market, Europe is used to seeing technology imported from across the Atlantic. In a reversal of this trend, one company is taking its experience in Europe and exporting its product to the more mature U.S. market....

Rake structure proves riskier for CMBS investors, says S&P report.(commercial mortgage backed securities)(Standard & Poor's Corp.)(Brief article)
September 19, 2006... Pooling benefits are increasingly being removed from European CMBS as arrangers split pools into A/B portions or rake structure, with the A portion going to the CMBS issuer and the B portion sold as B-notes to parties outside the CMBS...

Barclays steps into Mexican ABS, MBS.(Mortgage backed securities)(Brief article)
September 19, 2006... Yet another bank has heeded the call of Mexico's thriving domestic market. Barclays Capital just launched Grupo Financiero Barclays Mexico, consisting of a bank and a broker-dealer. Hailing from ABN Amro Securities, Antonio Villa has been...

First Mexican RMBS to be sold overseas is around the bend.
September 19, 2006... Mexico's first cross-border RMBS is on the way. Nonbank housing finance provider Metrofinanciera (Metro) is the originator on the transaction, which is expected to total around 295 million inflation indexed units (UDIs) ($99.7 million), with a...

Singaporean CMBS deals price, Thai RMBS imminent.
September 19, 2006... Two Singaporean CMBS deals priced last week. CapitaCommercial Trust (CCT) and CapitaMall Trust (CMT) - two real estate investment trusts established by property developer CapitaLand - closed a S$866 million ($552.6 million) issue put together...

First Chinese cross-border CMBS arrives.
September 19, 2006... After over a year of preparation, China's first cross-border commercial mortgage-backed securitization launched recently. Citigroup is sole bookrunner on the $145 million issue - called Dynasty Assets - which it jointly arranged with Macquarie...

Aussie activity continues with a flurry of deals.
September 19, 2006... The surge in activity by Australian issuers continued last week with National Australia Bank (NAB), IMB, Interstar and Resimac launching or closing deals. NAB is self-leading a $1.4935 billion synthetic balance sheet CLO, tied to a pool of...

Korea's LG Card launches first deal of the year.(Brief article)
September 19, 2006... Korean consumer finance provider LG Card last week launched its first 2006 deal. Merrill Lynch is arranger on the $500 million transaction - issued via the Credipia SPV - which is backed by a mixed pool of credit cards and auto loans. The...

Whispers.(briefs)
September 25, 2006... Cohen & Co. has hired Constantine Boyadjiev as a managing director responsible for leading the firm's risk management functions. This is part of the company's efforts to expand initiatives across its diverse business lines. Boyadjiev, who will...

Correction:.(Correction notice)
September 25, 2006... The article that appeared in the Sept 18 issue of ASR entitled First Chinese cross-border CMBS arrives' said that the Dynasty Assets deal was rated by Moody's Investors Service and Fitch Ratings. The deal was actually rated by Standard & Poor's...

Industry weighs in on state of subprime.
September 25, 2006... LAS VEGAS - From subprime lenders to home equity ABS investors, attendees at the Information Management Network's Subprime ABS conference held here last week found themselves predicting - in the midst of a changing U.S. housing market landscape...

ING Bank launches synthetic ABCP.(asset backed commercial paper)
September 25, 2006... Dutch financial institution ING Bank has prepared an asset-backed commercial paper conduit called Simba Funding Corp., which will provide credit default protection on the bank's assets. The unusual structure, not seen on the ABCP market for...

Blade prices unique aviation deal.
September 25, 2006... In a first for the aircraft ABS sector and for GE Commercial Aviation Services, Blade Engine Securitization recently completed a $362 million debt and equity transaction that combines elements of a securitization and a private placement...

Consumer sector drives market volume to $20 billion mark.
September 25, 2006... Fueled by active issuance from the consumer sector, and despite a slow early start, the ABS market raced toward a week of $20 billion in primary issuance. Although the market was quiet on Monday, as no deals priced, but by Thursday...

Moody's to suggest alternative HE ABS triggers.(home equity)(asset backed securities)
September 25, 2006... Moody's Investors Service this week will release a report suggesting home equity ABS deals incorporate more effective triggers. Analysts at the rating agency last week stressed they were not aiming to "dictate" the type of triggers used in home...

Sallie Mae looks to wholesale business for more growth.(Brief article)
September 25, 2006... Student loan provider Sallie Mae announced last week that it is looking to the wholesale consolidation loan business for its next growth channel. During a presentation last week at the Bank of America's 36th Annual Investment Conference...

Lehman brings three-tranche reverse mortgage deal.
September 25, 2006... Lehman Brothers last week closed its second reverse mortgage transaction since 2002. Contrasting from its 2005 issue, the $598 million SASCO 2006RM1, incorporates a $25 million single-A tranche. At least five more deals are expected in the...

Securitization Forum weighs in on NRSRO reform.
September 25, 2006... At the American Securitization Forum (ASF) Sunset Seminar on rating agency reform last Tuesday held at its headquarters, panelists urged ABS market professionals to bring their opinions on the issue before the Securities and Exchange...

First payment defaults, fraud, increasing in recent vintages.
September 25, 2006... LAS VEGAS - Subprime lenders are beginning to report marked increases in the number of borrowers either failing to make their first mortgage payment or falling behind shortly afterward - a trend some say is the result of overly aggressive...

Pali CDO biz taps middle market investors.(Collateralized debt obligations)
September 25, 2006... Since its inception more than a year and a half ago, brokerage firm Pali Capital's CDO structuring business has provided new options for middle market insurance companies, smaller banks and wealth management firms that focus on alternative...

Mortgages benefit post-FOMC helped by low volatility and tighter swap spreads.(Federal Open Market Committee)
September 25, 2006... Flows were modest last week in mixed flows. Ahead of the Federal Open Market Committee statement last Wednesday, mortgages saw better selling, particularly on Tuesday, as the market slipped through 4.75% on the 10-year Treasury due to the...

CRE CDOs get ready to roll but still some logistical questions lingering.(commercial real estate)(Collateralized debt obligations)
September 25, 2006... Europe's first CDOs backed by commercial real estate (CRE CDOs) are expected to hit the market this autumn. Investec last week announced its GBP200 million ($378.4 million) commercial real estate CDO, kicking off the market for this asset class...

Double-B notes on offer in support of U.K. credit card trusts.
September 25, 2006... With deterioration continuing among U.K. credit card trusts, market players are expecting more deals to follow Barclaycard's GBP111.8 million ($211.8 million) subordinated multi-tranche issue that supports its GBP8.2 billion Gracechurch Card...

Bankruptcies are on the rise in the U.K.
September 25, 2006... The rise in U.K. bankruptcies and Individual Voluntary Arrangements (IVAs) have a major impact on credit card portfolio trusts because they are typically fast-tracked through to charge-offs. This would have a more immediate impact on U.K....

Deluge of autumn deals could bring pricing trend reversal to Euro ABS market.(asset backed securities)
September 25, 2006... The month of September is only half over and the European securitization market has already priced 27 billion ($34.3 billion) of new deals. With another 20 billion actively marketing expected to price by the month's end, the question remains...

Hedge funds take a walk on the wilder side with Canguru.
September 25, 2006... Foreign investors in Latin America have found a riskier, more lucrative pouch for their funds. Shares in Brazilian receivable investment fund (FIDC) Canguru have gone to at least two hedge funds, signaling that these risk seekers are now upping...

SCFB to launch Asia's largest ABS as uncertainty surrounds Thai ABS.(Standard Chartered First Bank )(asset backed securities)
September 25, 2006... Standard Chartered First Bank (SCFB), the Korean subsidiary of Standard Chartered, is prepping what will be ex-Japan Asia's largest ever cash securitization. According to reliable sources, SCFB is still finalizing the pool size for its sixth...

ANZ completes largest domestic offering.(Australia and New Zealand Banking Group Ltd.)
September 25, 2006... Despite synthetic balance sheet collateralized loan obligations by Australian banks being a relatively new asset class, widespread demand caused ANZ Bank last week to double the size of its debut CLO from A$1 billion ($753.5 million) to A$2.2...