Italian securitization volumes have reached unprecedented levels, such that some investors are full up on the product.

Still, innovation from Italy seems unstoppable. At this year's Barcelona conference, speakers joining the Italian ABS session said there is still plenty more to expect going forward.

How will the market develop? Well, right now banks looking to minimize cost have executed joint transactions. Mortgages and leasing securitizations will likely take the spotlight. Panelists added that non-performing loans may not be as large a part of the market as in previous years.

One area of interest, however, is making use of the master trust structure. The structure promotes flexibility that would allow originators to finance themselves more tax effectively. One panelist also mentioned the possibility of erecting an Italian pfandbriefe market.

Also on the agenda are corporate securitizations. Under the Italian Law 130, corporates are not allowed to service transactions, which means added costs to originators contemplating whole business deals. At the moment, parties are working on term receivables transactions. An expanded asset-backed commercial paper market would also allow the smaller entities better access to the capital markets.

On the public sector side, the market can expect to see an increase of local government transactions, along with the ever-popular central government securitizations that have dominated Italian issuance to date

See ASR next week (6/16) for full story.

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