As the first week of the third quarter coincided with Wednesday's full market close in observance of Independence Day, activity was scarce in last week's asset-backed market. In primary market activity only one new issue was marketed all week and secondary trading was reportedly just as sparse.
The one new issue seen circulating last week came from Credit Suisse First Boston, which was set to price Friday $282.8 million of home equity loan-backed paper.
The series 2001-HE16 offering consisted primarily of a $262.3 million A class, with a 2.8-year average life, talked in the 30 basis point area over one-month Libor. The remainder of the offering came in the form of two mezzanine and one subordinated classes, talked in the 65, 120 and 215 basis point areas over one-month Libor, respectively.
Those who were in the office last week spent their time gearing up new issuance for the coming weeks with several deals scheduled to begin road-showing this week. Seen tapping the market before July is over are American Honda Finance, AmeriCredit Corp., Xerox Corp. and Access Education Financing.
The largest of the scheduled offerings is $1.5 billion of an auto loan-backed deal from captive auto finance company American Honda Finance via the joint leads of Banc One Capital Markets and Salomon Smith Barney. The Torrance, Calif.-based lending arm of Honda Motor Co., a less-than-annual issuer in the past, most recently sold a $1.5 billion deal in February.
Staying in the auto-loan sector, but moving down in the credit spectrum slightly, AmeriCredit Corp. plans to sell up to $1.2 billion of near-prime auto loan-backed notes, reportedly via Deutsche Banc Alex. Brown. Following the success of the company's second-ever senior/subordinated deal, the Fort Worth, Texas-based lender will offer its first wrapped transaction of the year.
Xerox Corp., which has seen its corporate credit rating drop from the single-As to below investment grade levels in the past year, will tap securitization markets for the first time since 1998, sources said. The securitization of office lease equipment will be led by Merrill Lynch, it was added.
Access Group Inc. is in the market with $800 million of a student loan-backed transaction via the lead of Deutsche Banc Alex. Brown this week, sources noted. The company was last in the market last November with a $109 million offering via UBS PaineWebber.
Also heard in the market, but without official confirmation is another offering from MBNA Bank N.A.'s newly established "MBNA-series" master note trust, which allows the credit card issuer to de-link senior and subordinated classes and sell pre-enhanced triple-A rated paper.
