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Preholiday week pickup marks an $11 billion ABS week

Despite damp and gloomy weather for much of last week, the ABS market appeared to get ready for the official start of summer. Issuance picked up the pace last week, with $11 billion in offerings at press time.

"We are seeing an uptick in issuance," one trader said. "There was some desire to get deals out prior to a short week, Memorial Day weekend next week."

Once again, the home equity sector dominated activity for the week, with just a sprinkling of offerings from autos and credit cards. There was also talk of a $1.5 billion student loan transaction, GOAL Capital Funding Trust, before week's end.

Morgan Stanley managed a $2 billion Morgan Stanley ABS Capital I home equity deal. The one-year tranche priced at four basis points over the one-month Libor, while the most junior piece came in at 187 basis points over. Bear Stearns' SACO I Trust, backed by a pool of second-lien loans, also came to market. The senior tranche on the $571 million deal had a one-year tranche that priced at 14 basis points over the one-month Libor, while the three- and one-half year piece was 195 basis points over the benchmark.

Among autos, the USAA Auto Owner Trust came to market with a $1.1 billion transaction via Deutsche Bank. Using a combination of Libor, EDSF and swaps, most of the deal saw fairly tight pricing. The one-year tranche came in at three basis points below the EDSF, and the deal offered the best chance for spread pick up on the BBB-rated piece, which came in at 23 basis points over swaps.

Barclay Capital's Securitized Asset Backed Receivables Trust came to market with a $593 million home equity loan deal. The most senior five-year piece came in at 28 basis points over the one-month Libor, while a double-B-rated tranche snagged 675 basis points over the benchmark. Citibank Credit Card Issuance Trust came to market with a $750 million, single-tranche deal that priced at six basis points below swaps.

Goldman Sachs' GSAA Home Equity Loan Trust came to market with a $1.5 billion transaction. The senior tranche priced at five basis points over one-month Libor, while the BBB-tranche came in at 187 basis points over. SoundView Home Equity Loan Trust completed a $658 million home equity loan deal, with RBS Greenwich Capital acting as lead manager. The one-year senior piece snagged narrow spreads at three basis points over the one-month Libor, with the most junior tranche providing a chance for yield pickup, at 800 basis points over the benchmark.

Triad Auto Receivables Owner Trust a $915 million deal that came to market via Citigroup Global Markets, was another deal that used several benchmarks. The senior piece actually tapped the commercial paper market, with P-1 and A-1 ratings from Moody's Investors Service and Standard & Poor's, and came in at one point below Libor.

Bear Stearns completed another real estate ABS deal this week, the $752 million Carrington Mortgage Loan Trust. The one-year tranche on that deal priced at four points over the one-month Libor, and a BBB-rated four-year piece came in at 187 basis points over. The Securitized Asset Backed Receivables, a $604 million home equity loan deal, priced its senior five-year tranche at 28 basis points over the one-month Libor, while the most junior piece was 675 basis points over. Barclays Capital acted as lead manager.

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