Global structured finance issuance's modest pace in 1Q12 is credit positive for new-issuance in these products that include ABS, RMBS, CMBS and CLOs, according to an emailed note from Standard & Poor's this morning.
The figures include issuance from U.S., Europe. Australia and Japan.
Analysts explained that lenders, except for a few exceptions, are not yet pushing underwriting standards to expand volumes.
They project that U.S., European, Japanese, and Australian structured finance and covered bond issuance totaled $256 billion in 1Q12, which dropped 23% from the same period last year.
Meanwhile, analysts reported that U.S. ABS and CLOs showed increases in volume, while covered bonds and European ABS showed the biggest dips, analysts said.
They predicted that the slowdown in European and covered bond issuance will continue. However, they project a short-term active calendar for U.S. auto ABS, CLOs and CMBS.
U.S. ABS issuance increased 66% to $53 billion in 1Q12 over 1Q11, with the auto ABS sector leading. Autos comprised roughly half of the total number, they said.
Auto sales have been strong and analysts expect high issuance levels for the next few months. There were three non-agency RMBS totaling $1.4 billion. They project less than $5 billion for the year as government agencies are still dominating the market.