With hardly a glitch in the pricing process, the first visible multiline insurance-wrapped transaction since the AIG/Hollywood Funding debacle quietly passed through the Rule-144A ABS market recently, sources said, faring quite well despite investors' tremendous need for comforting and coddling from the rating agencies prior and during launch. A separate deal, however, done as a traditional private, is believed to be the first actual multiline-wrapped deal since the AIG controversy.
The former transaction, World Omni 2001-A Automobile Lease Securitization Trust, a 144A for $945 million, priced last month and had a residual value insurance policy from Chubb Indemnity Insurance Company providing coverage for the residual value losses of the leased vehicles upon turn-in at maturity. The multiline company's policy is a property and casualty insurance-style wrap, similar to the one used on the infamous Hollywood Funding deals, which were downgraded from AAA' to D' by Standard & Poor's earlier this year when AIG subsidiary Lexington Insurance refused to pay out to investors. Moody's did not participate on the AIG transaction, but did rate the World Omni deal.