Among other significant impacts, the proposed regulatory changes concerning residuals and risk management for asset-backed banking could contribute to the current surge in collateralized debt obligation-type product, said industry sources.

"These new recourse rules are going to have a profound effect on how banks retain subordinated pieces and residuals," said an ABS consultant who works closely with the regulators. "And [banks] going to have a great deal of incentive to get rid of them, and these arbitrage CLOs look to be the fastest way to get rid of them."

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