Things were rosier at last week's ABS East gathering. For one, attendance was up 33% versus last year, according to Information Management Network figures.
More importantly, the fighting spirit was back. In contrast to last year's downtrodden mood, attendees at this year's event - as Nora Colomer details in her cover story - were optimistic about securitization's place in the financial universe. A number of panelists defended securitization as a funding tool that's not only economical but irreplaceable.
Hindsight has also given market participants a clearer perspective. As United Capital Markets CEO John Devaney said at one of the conference panels: "The reason everyone has been so positive this year is because the world as we know it didn't collapse."
Indeed, things seem to be looking up, at least for some areas of the market. Several CLOs are coming down the pike, according to Richard Kellerhals's article. There has also been renewed interest in life settlement securitizations, a currently small niche that might live up to its volume potential if a more commoditized product results from the regulatory changes expected in the insurance industry.
Hope has even trickled into the mortgage sector. Sally Runyan writes that despite the Federal Reserve scaling back on MBS buying, the supply/demand technicals for mortgages are expected to stay favorable, at least in the near term.
There are also bright spots in the securitization markets around the world. Despite RMBS issuance plunging in major markets of the U.S. and Europe, Felipe Ossa's article depicts a thriving RMBS market in Colombia, which issued a record volume of deals in 2008 and is expected to do so again this year. He also examines the incipient return of market investors to RMBS in Australia and why they bolted in the first place given the enduring health of collateral down under.
Back in the U.S., while we seem to be having better days, ABS players aren't taking anything lying down. Efforts are underway to correct past mistakes, although the benefits of such moves remain unclear at this point.
Bill Berliner's column this month looks at the discussions and proposals on reining in the excesses of the financial system. He points out that while there is some logic behind the various proposals, most of them skirt important fundamental issues.
Meanwhile, Poonkulali Thangavelu focuses on Horsham, Penn.-based Realpoint, a credit rating agency approved last September by the National Association of Insurance Commissioners. Specializing in CMBS, Realpoint is looking to fill a void created by the perceived failings of the big three agencies. Everyone will want to see how this upstart fares with having investors - instead of issuers - pay for ratings.
Another story included in this issue is an observation from Standard & Poor's about heightened scrutiny of U.K. loan servicers thanks, in part, to a rise in loan defaults. Although some structured finance investors have negative views on U.K. loan servicing, servicers claim that the picture is actually mixed.
Finally, Investment Dealers' Digest's Kelly Holman focuses on the case of Peter Cooper Village-Stuyvesant Town, whose developers Tishman Speyer Properties and BlackRock were successfully sued by tenants in a case that could have broader implications for CMBS.
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