In the midst of the winter ABS conference season, primary activity slowed last week. The presence of several large offerings, however, kept volume levels respectable. Through last Thursday, the U.S. ABS market had priced $8 billion, with an additional $1.5 billion hoping to wrap up in Friday's session.

While real estate ABS continued its unusually strong January, pricing more than $25 billion for the year's first month, versus nearly $15 billion in January 2003, the credit card and auto loan sectors continued to sputter. The student loan sector closed a strong month by completing a large transaction.

The auto loan sector saw just its second transaction of January, the first backed by subprime collateral. AmeriCredit Corp.'s $750 million 2004-AF offering, wrapped by FSA, priced via Banc One Capital Markets and JPMorgan Securities. Amid just $1.6 billion of auto loan supply throughout the month, investors snapped up AmeriCredit's first deal of 2004, taking advantage of the yield pickup versus the last auto loan ABS - Capital One Financial's COPAR deal from Jan. 21.

In one-year notes, AMCAR priced just six back from COPAR to yield 11 basis points over EDSF. Out on the curve, spreads cleared at 19 and 23 basis points over swaps for two- and three-year paper, respectively - inside of guidance.

With $6.25 billion of mortgage-related supply last week, the sector will likely record its largest January to date. In the market last week were a pair offerings from Countrywide Home Loans Inc., including the week's largest offering. Lehman Brothers' SAIL shelf and C-BASS each priced offerings.

Countrywide's $3.15 billion 2004-1 home equity offering featured nearly $2 billion that was placed prior to hitting the market. As has been the trend early this year, CWL 2004-1 offered investors the full credit spectrum - from triple-A down through single-B plus rated bonds. Earlier in the year, Long Beach Mortgage and Option One Mortgage each used similar structures for the large offerings brought to market, taking full advantage of the strong demand for mezzanine and sub classes.

Countrywide also completed a $216 million offering, backed by program exception loans, dubbed CWL 2004-SD1. Countrywide's scratch-and-dent SD shelf began issuing last January and has priced four new issues to date.

Hoping to wrap up Friday afternoon, Saxon Capital was marketing a $1 billion senior/sub deal via Merrill Lynch; Bank of America's ABFC shelf and Merrill's MLMI shelf each had pending offerings.

The Arizona Educational Loan Marketing Association wrapped up the $1 billion student loan ABS it had been shopping via UBS. Of the $1 billion, $530 million was offered in term floaters, with the remainder in auction rate securities. The triple-A 2.8-year A1 class priced at 10 basis points over three-month Libor, at the wide end of price guidance. The seven-year triple-As priced at 22 basis points over Libor, versus guidance in the low 20 basis point area.

With IMN's ABS West 2004 scheduled for this week, activity is expected to remain muted through Thursday at least, when most participants return to the office. Many anticipate auto loan supply in particular, as many issuers have hoped to meet with investors over the three-day gathering.

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