Metris Master Trust credit card ABS tightened following the news that parent The Metris Companies closed a portfolio sale and a new conduit facility. Metris sold $145 million in accounts and receivables from the Direct Merchants Credit Card Bank and $445 million of receivables from the Metris Master Trust. Metris also announced a new, private conduit facility totaling $610 million.

The conduit facility will replace the MMT series 2001-1 transaction, which will now enter into defeasance, ahead of its January 2004 maturity. As a result, spreads for MMT 2001-1 class A, which pays 22 basis points over one-month Libor, traded at a reported 100 basis points over Libor last Thursday, a 100 basis point tightening from pre-announcement levels.

Other, longer-dated series tightened 15 to 30 basis points late last week, with levels quoted at 260 to 270 basis points over Libor, depending on vintage.

"Metris is one of the few distressed opportunities in the ABS market remaining with the potential for a substantial pickup in realized yield," noted JPMorgan Securities' ABS research head Chris Flanagan. "Based on these positive developments, we see good value at these levels."

Subscribe Now

Access to a full range of industry content, analysis and expert commentary.

30-Day Free Trial

No credit card required. Access coverage of the securitization marketplace, including breaking news updated throughout the day.