For the second week in a row, the U.S. ABS primary market has generated $13 billion in new issuance. As usual, the calendar was dominated by real estate related deals, with three credit card deals, an auto deal, a student loan deal and an insurance receivables deal sneaking their way into the market.
The largest deal to hit the market last week was a $2.38 billion offering out of Lehman Brother's Structured Asset Investment Trust, backed by subprime MBS. The 2.5-year A1 tranche of the deal priced at 29.5 basis points over one-month Libor, with the two-year tranche at 20 basis points over one-month Libor. The five-year A3 tranche at 36 basis points over one-month Libor, and the one-year A4 tranche pricing at 11 basis points over one-month Libor. Lehman also had an $884 million second lien MBS offering in the market, off its Structured Asset Securities Corp. Trust, which priced wide of guidance almost all the way down the capital structure.