As collateral warehouse lines tightened and deals unwound amid subprime performance fears, the mezzanine ABS CDO sector saw its slowest monthly volume in April since November 2005. The volume dropped 75% to $3.5 billion from $13.5 billion in March, according to Lehman Brothers.

And while some extol the virtues of mezzanine ABS CDO issuance in the current environment, others say the difficulty in placing debt could result in a prolonged dry spell for the sector.

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