Even though many in the market were basking in Barcelona last week, the U.S. primary ABS market made a respectable showing with just over $12 billion in new issuance circulating. Real estate ABS, in particular, had a busy week, with $6.37 billion either priced or marketing as of Thursday's close.
GE Capital Corp. finally completed its inaugural $952.5 million retail credit card offering via Credit Suisse First Boston and JPMorgan Securities. Based on pricing levels for the three-year deal, the first-time issuer is viewed as top-tier.
Triple-A three-year notes priced at five basis points over one-month Libor, with single-A and triple-B subordinates pricing at 30 and 55 basis points over Libor, respectively.
Bank One N.A. and MBNA America Bank each quickly tapped the market, with de-linked offerings that both saw increases in size. Bank One's $1.25 billion three-year triple-A offering priced at four basis points over one-month Libor, in line with guidance. MBNA, in with $275 million of 100-year triple-B rated notes, priced at 90 basis points over Libor.
The auto sector priced $5 billion in new supply with two deals having priced by Thursday and one more expected to price Friday. Honda Motor Credit hit with $1.8 billion via joint leads Barclays Capital and CSFB, and Wachovia Bank offered its first-ever internally originated auto loan securitization.
As one of the top performers in the industry, Honda saw the tighter execution, pricing one- two and three-year paper at four, three and four basis points over EDSF and swaps, respectively.
Wachovia's $1.87 billion 2004-A deal, backed by prime collateral, priced its two-year notes at four basis points over swaps compared to initial expectations in the three basis point area. The three-year triple-A A4 notes also came in one point outside, pricing at five basis points over swaps.
Impac Mortgage came to market with a formidable $2.03 billion multifamily property offering via Countrywide Securities Corp. The 2.29-year triple-A rated A1 notes priced at 40 basis points over one-month Libor compared with guidance in the 38 to 40 basis point range. GMAC-Residential Funding Corp. also made an impression with its $992 million scratch-and-dent transaction through JPMorgan Securities. The 4.45-year double-A rated class came in just outside of price talk at 62 basis points over one-month Libor versus guidance in the 60 basis point area. Meanwhile, the triple-A rated fixed-rate AI2 notes also priced outside, at 78 basis points over swaps compared to talk in the mid-70s over.
GreenPoint Financial Corp. tapped the market for $226.9 million with its third HELOC ABS of the year, led by Wachovia Securities and wrapped by Ambac. The triple-A rated 2.45-year notes came in on target at 23 basis points over one-month Libor.
Countrywide Home Loans also priced a $630.5 million HELOC offering. The 3.41-year triple-A rated 1A2 notes tightened to clear at 22 basis points over one-month Libor versus talk in the 22 to 23 basis point range. Countrywide was still shopping a $530 million home equity transaction, backed by loans originated by Encore Mortgage at week's end.
C-BASS hit with a $129.71 million offering backed by reperforming loans through Deutsche Bank Securities. The 2.39-year triple-A rated A1 notes came at 42 basis points over one-month Libor versus guidance in the 40 basis point area over and the 3.07-year triple-A rated notes priced at 30 basis points over one-month Libor versus talk in the high 20 basis points over Libor. The 4.07-year triple-B rated floater came in on target at 215 basis points over one-month Libor, with the 6.55-year fixed-rate triple-B yielding 225 basis points over swaps, versus guidance in the 220 to 225 point range.
Commercial lender Capital Source brought its first deal of the year, a $755.5 million in senior/subordinated structure backed by small business loans via Citigroup Global Markets. The one-year and three-year triple-A seniors priced at 13 and 33 basis points over one-month Libor, both at the tight end of guidance. The double-A rated sub class also came inside at 65 basis points over one-month Libor compared with guidance of 65-70 points.
With a rare insurance premium ABS, Mellon Bank priced a $500 million deal via Citigroup Global Markets. Mellon's three-year senior A class priced at 16 basis points over one-month Libor, with the single-A and triple-B subordinates pricing at 42 and 77 basis points over one-month Libor - both right on the screws of price talk.
The lone equipment deal came from sector benchmark issuer, The CIT Group Inc., which completed its $453 million series 2004-EF1 offering, via Citigroup Global Markets and CSFB. One-year triple-A seniors priced at eight basis points over EDSF, while 2.23-year triple-A A3 notes priced to yield 19 basis points over swaps. Double-A rated B paper, with a 1.3-year average life, priced at 27 basis points over EDSF and 3.24-year single-A rated C paper cleared at 35 basis points over swaps - both in line with guidance.
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