This week's fourth annual Banc of America Securities' March Madness conference, held at the Four Seasons Hotel Las Vegas, has in recent years become one of the most useful and efficient ways for the bank to increase transparency between ABS issuers and investors as well as simultaneously grow its own business by leaps and bounds.
The proof is evident: as the first quarter comes to a close, Banc of America Securities' ascendant ABS franchise has catapulted the firm into the upper levels of league-table rankings.
And this yearly event surely has something to do with it, said BAS executives. In addition to panel discussions with industry leaders, as well as issuer presentations and one-on-one meetings with some of the largest investors in the ABS market, the event offers a forum for investors to complete thorough due diligence for a wide range of issuers.
More importantly, the conference gives BAS a captive audience on both sides of the fence. "With the troubles seen in the credit markets, in 1997 and 1998, we saw that some issuers were clearly superior to others in their business models and operations," said Adam Garfinkle, managing director and co-head of ABS/MBS structured finance for the Charlotte-based bank. "This forum allows these issuers to present directly to investors what differentiates them from their competition."
The benefit of this? BAS has the opportunity to set up future lead-managing roles.
This approach, seen more commonly in equity and high-yield debt markets, was born out of the credit crunches seen in 1997, prompting the bank to start a home-equity gathering in order to allow issuers to differentiate themselves from each other, Garfinkle said. Seeing the increase in transparency within the sector as a result, and the business that followed, BAS expanded the event last year to include all sectors of the ABS market, including some of the more esoteric assets, such as equipment finance, for example, in addition to autos, cards, student loans and home-equity.
The event is set up with a leisurely Sunday featuring a golf outing, spa treatments, indoor skydiving, capped off by a poolside welcoming reception. The next day-and-a-half are more intense, offering non-stop sessions and networking opportunities starting with a 7:30 a.m. breakfast on Monday, going straight through until the issuer presentations wrap up at 7:00 p.m. Tuesday features two separate two-hour issuer presentation periods, sandwiched between a luncheon.
In all, Garfinkle says an investor could theoretically have up to 10 separate 50-minute sessions with various issuers during the gathering. Factoring in the one-on-ones, set up by the bank on request, a buysider can potentially complete due diligence on up to 30 different issuers over the three-day event, he added.
"The intention is not to create a boondoggle, but to get some work done," said Garfinkle.
In attendance this year will be the key representatives from the likes of Capital One, GMAC-RFC, Household, Long Beach, MBNA, Option One, Sallie Mae, WFS Financial. The buyside will be represented by some of the largest names in the business.
