Driven by investors seeking additional yield in the face of falling benchmark rates, ABS new issues saw fairly significant widening last week in the time leading up to pricing. Each of the three major ABS issues offered last week had spreads at the wide end of talk and some priced significantly wider.

Matt Whalen in JPMorgan's ABS group cited a general lack of liquidity in the financial markets following Sept. 11 as well as the investor community seeking additional yield from new issuance. The important aspect though, according to Whalen, is that "deals are being priced and all of the paper being offered is being sold."

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