After a sluggish 1Q05, European ABS volume is back on track and analysts report that a healthy visible pipeline could hoist volumes for 2005 above January forecasts. The European Securitization Forum said issuance in the European securitization market totaled 48.1 billion during the first three months of the year, a 13.8% decline from 55.8 billion issued over the same period last year. But a strong primary rally over the past weeks is sure to cushion recent issuance volumes.
According to Dresdner Kleinwort Wasserstein, year-to-date volume currently stands at 113 billion, with supply dominated by RMBS (48%). CMBS (17%), arbitrage CDOs (10%), balance sheet CDOs (7%) and subprime MBS (7%) make up the difference. CMBS issuance this year stands at 19.3 billion, only 1.2 billion short of the 2004 full-year total. Balance sheet CDO supply has been driven by two recent jumbo deals, Geldilux-TS- 2005 from HVB and the SME CLO/MBS deal BBVA Hipotecario 3, and currently amounts to 61% of the 12.7 billion full-year 2004 total.