The ABS market had a busy week, one wherein the home equity loan market shared the limelight with the auto loan, credit card and business loan sectors. While ABS professionals expected the market to clear up to $15 billion in deals for the week, issuers and underwriters completed about $9 billion by Thursday afternoon.
Among credit card deals was the Capital One Multi-Asset Execution Trust, which priced a $750 million deal via Merrill Lynch, and achieved pricing that was 1.5 basis points over the one-month Libor.
Several auto loan ABS deals hit the market too. Volkswagen Auto Lease Trust, for instance, completed a $1.5 billion transaction with Barclays Capital acting as lead manager. On that transaction, the top tranche was sold into the asset-backed commercial paper market, at Libor minus one basis point. There was some opportunity for spread pickup, as it were, from the 2.53-year tranche that came in at seven basis points over swaps. Nissan Auto Receivables Owner Trust floated $1 billion in asset-backed paper, with Deutsche Bank Securities acting as lead manager. Like Capital One, Nissan sold its most senior tranche to the ABCP market, but its pricing came in at two basis points under Libor.
Among credit card deals, Banc of America Securities' Bank of America Credit Card Trust drew praise from some market participants for its $575 million transaction. Not only did the issuer increase the size of the deal, from $275 million, it still achieved pricing at three basis points over the one-month Libor on its seven-year-plus tranche.
"We laud them for that," said one trader. "It was just very aggressive pricing."
The Acas Business Loan Trust put business loans on the securitization map last week. With Wachovia Securities acting as lead manager, the deal achieved pricing of 23 basis points over the three-month Libor on the pieces that were offered broadly.
As usual, home equity loans made up the bulk of issuance for the week. In keeping with tightening trends, most of the deals saw pricing at four basis points over the one-month Libor for one-year tranches. Among notable deals, UBS' Master Asset-Backed Securities Trust came to market with a $471 million transaction. On that deal, the one-year tranche priced at five basis points over the one-month Libor.
Countrywide Asset-Backed Certificates floated about $1.6 billion in ABS debt onto the market with two transactions. CWL 2006-13 and its one-year piece came in at an atypical 12 basis points over the one-month Libor. Meanwhile, the series 2006-12N, a short-term certificate, will pay investors a 7.25% return. Fremont Home Loan Trust completed a $944 million transaction, via UBS. On that deal, the triple-B piece, priced against the one-month Libor, came in at 550 basis points over the benchmark. And while Banc of America was busy drawing kudos for its credit card deal pricing, its CBASS 2006-CB6 transaction had a 6.4-year piece that came in at 25 basis points over the one-month Libor. The triple-B rated 4.44-year piece priced at 99 basis points over the same benchmark.
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