The asset-backed securities market sprinted to the finish line during the holiday-shortened week as last Monday's market close in observance of Memorial Day got issuance off to a slow start.

Things did pick up, however, as new issue announcements soon hit the wire from DaimlerChrysler N.A. Holdings and Providian Financial's "Gateway" Master Trust. Also seen last week were deals from Sears Roebuck & Co. and Bank of America, bringing total weekly volume to $5.79 billion.

The week's largest offering was from DaimlerChrysler Auto Trust (DCAT), which sold a $1.86 billion auto loan securitization via the joint leads of JP Morgan Securities and Salomon Smith Barney. The series 2001-B offering contained three publicly offered fixed-rate tranches, with average lives of one, two and 3.15 years in addition to $359.44 million of paper, which was not offered.

The $615 million A-2 class, with a one-year average life, priced to yield 12 basis points over EDSF, widening from initial guidance of 10 to 11 basis points over. The $480 million A-3 and $408 million A-4 classes priced in line with guidance to each yield 11 basis points over two-year and 11 basis points over an interpolated swap curve, respectively.

The weakening demand seen in the market for one-year fixed-rate paper continued with this offering, as steepness in the yield curve was credited with forcing the A-2 class to widen a touch. "Investors are seeking an additional pick-up in yield, not on a spread basis but on an absolute yield basis, due to the steepness seen in yields," said Andrew Dym, managing director in the auto ABS group for JP Morgan.

"Twelve (over EDSF) was the level at which this deal cleared the market and it is a level that is still indicative of DaimlerChrysler as a benchmark issuer in this sector of the ABS market," he added.

Enjoying a taste of success, eight months after unveiling its "Gateway to Credit" program, aimed at getting credit cards in the hands of those with limited or damaged credit histories, Providian's 144A offering of three- and seven-year floaters saw enough demand to increase both offerings and still close "heavily oversubscribed," sources noted. European demand for the seven-year offering was particularly strong (see story page 6).

The $550 million three-year 2001-C offering increased from $500 million, pricing at the tight end of guidance, coming in at par with a coupon of 23 basis points over one-month Libor. The $650 million seven-year 2001-D offering also increased from $500 million, pricing at par with a coupon of 37 basis points over one-month Libor, also at the tight end of guidance.

Barclays Capital led the issue, the bank's second lead-manager role of the year, following the approximately $300 million seven-year credit card offering for Advanta Corp.

Also seeing strong demand in the credit card sector, Sears Roebuck & Co. priced $757 million of three-year floaters via the lead of Merrill Lynch & Co., which was increased in size from an initial $500 million.

The $700 million triple-A rated senior class, up from $500 million, priced at par with a coupon of 11 basis points over one-month Libor, within price guidance. Additionally, $57 million of single-A rated B paper priced at par with a coupon of 29 basis points over one-month Libor.

In the market for the first time since July of 1999, Bank of America priced $800 million of five-year floating-rate credit card-backed paper. Unit Banc of America Securities led the series 2001-A offering. BofA plans to now issue credit card paper two to three times a year, sources said.

The $696 million triple-A-rated senior class priced at par with a coupon of 12 basis points over one-month Libor and the $40 million single-A rated class priced at 37 basis points over one month Libor.

Secondary trading was slow to start last week, but Wednesday was fairly active with separate bid lists, each topping $200 million, seen with on-the-run floating-rate credit card and short-term fixed-rate auto loan paper.

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