Pending implementation of Basel II in Europe and an unwavering confidence in the mortgage market marked substantial changes to two ABCP conduits in recent weeks.
Landesbank Berlin has restructured Check Point Charlie, the ABCP program that it sponsors, allowing the conduit to appeal to investors outside the U.S. and to diversify its source of funds. The move is also timed to allow the bank to take advantage of Basel II Accord rules, which go into effect January 2007 in Europe. Meanwhile, in case anyone suspects housing market jitters might sideline liquidity for the market, Calyon added a $200 million residential MBS deal to its La Fayette ABCP program, and restructured it to include expanded eligibility requirements for mortgage loans. That deal comprised of prime mortgages, putting it far away from looming troubles in the subprime and HEL sectors.