Barclays: European ABS Volume Flat in 2013 at €50b

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Barclays Capital expects total issuance volume for European securitization to remain more or less the same in 2013 from this year, although the mix is likely to change, analysts from the bank said in a report released Monday.

They forecast about €50 billion in publicly placed volumes next year, from the €52 billion forecast for the full 2012. So far this year the figure has totaled €48.7 billion.

An expected drop in U.K. prime RMBS issuance — which has recently been a cornerstone of activity (see chart below this article) — should be offset by a rise in other sectors.

The Bank of England’s Funding For Lending Scheme (FLS) will continue to weigh on RMBS issuance from the U.K. by providing cheaper financing, but whole business securitization, auto asset-backeds, and Dutch Prime RMBS should help pick up the slack. Barclays also cited two upside variables. One is the launch of the Prime Collateralized Securities (PCS) initiative, which brands higher-quality ABS. The other is the fact that spreads are presently the tightest they have been since the global financial crisis. This has made issuance more economical for originators.

The analysts point out that these predications will naturally be shaped by the outcome of regulatory developments as well as by the vicissitudes of the Eurozone crisis.

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