Another busy week of new issuance was seen in the U.S. asset-backed securities market, with just over $7 billion having priced as of press time last Thursday.

The week was marked by two notable firsts: Newcomers this week included the first foray into the auto-loan sector by Wells Fargo and the first draw of subordinated paper from the new MBNA master trust. Other notable offerings to see strong demand came from a pair of infrequent issuers, BMW and USAA, which sources said "are looked at the same as a new issuer." Scarcity kept pricing spreads tight in the face of burgeoning supply, market observers said.

Wells Fargo sold a $735 million auto loan-backed deal Tuesday via the joint leads of Deutsche Banc Alex. Brown and Morgan Stanley. The fixed-rate offering saw strong demand and as a result tightened across the board from initial price guidance. The money market A-1 class priced one tight to initial talk with the A-2 class, with a one-year average life pricing at the tight end of guidance. The A-3 and A-4 classes priced one and two basis points, respectively, coming in at 12 and 14 points over comparable swaps.

MBNA became the second credit card issuer to utilize the "block & trap" master trust structure, introduced late last year by Citibank, with the offering of $250 million each of single-A and triple-B rated five-year subordinated notes via Lehman Brothers. While the $250 million B-rated class came at the tight end of talk, pricing at par with a coupon of one-month LIBOR plus 37.5 basis points, the triple-B rated Cs widened slightly to price at par with a coupon of 105 over LIBOR. The scheduled issuance of pre-credit enhanced senior paper had not been announced.

The largest offering of the week, $1.6 billion of auto loan paper from BMW, was "a complete and utter blowout," a source at lead manager J.P. Morgan Chase said. "The deal was two to three times oversold in all classes and orders stopped being taken literally one hour after the books were opened," a banker said.

The series 2001-A offering, just the company's second auto-loan deal ever, priced tight to guidance in all classes to yield six under four-month LIBOR for the A-1 class, eight over EDSF for the A-2 class, ten over swaps for the A-3 and 12 over swaps for the A-4.

Demand was strongest in the $499 million A-3 class, with a two-year average life, which saw involvement from approximately 20 investors, "a who's who of asset-backed investors," it was added. Credit for the success was given to the strength of the issuer name globally and the strong credit quality of borrowers.

Another blowout this week came from insurer USAA, which sold $800 million of prime auto loans, also via JP Morgan. The high credit quality of the issuer, USAA is rated triple-A by all three rating agencies, was credited for the strong demand.

Looking to next week, Conseco Inc. is scheduled to offer its first ever private label credit card securitization, although buy-side sources have called the collateral "kitchen sink"-backed by receivables from home improvement stores, clothing stores and recreational equipment. Credit Suisse First Boston is lead manager for the deal.

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