People
Bank of America's head of ABS research and author of ABS First Look, Meredith Hill, will resign as of March 8th to start her own travel business - Hill's of Africa Travel, Inc. BOA's ABS First Look will continue to be published and her successor has yet to be determined. Meredith welcomes any calls after April 15th at 704-338-1010, or email hillsofafrica@hotmail.com.
Nomura Securities, New York, has hired six securitization and underwriting professionals, all of whom previously held commercial mortgage-related positions at another Wall Street firm, to boost its global securitization capabilities. The new hires and their titles are as follows: N. Dante LaRocca, managing director in Nomura's securitization group; Mark Brown, director responsible for CMBS Capital Markets; Jeremy Stoler, vice president in CMBS Capital Markets; Bruce Viergever, vice president with responsibility for credit policy in commercial mortgage lending; John Tesoriero, vice president for commercial lending administration and operations; and Michael Pryluck, commercial mortgage lending analyst. All six previously worked for Donaldson, Lufkin & Jenrette.
News
Fannie Mae announced last week that it will redeem $8.205 bln in medium term notes on March 8. A total of 57 issues which mature between September 14 of 2001 to August 25 2005 will be called, the largest of which is the February 19, 2004 note worth $1.0 bln.
Although no timing has been set for this review, Rep. Baker (R., La.) is concerned about the degree of volatility in FAS 133 and how it affects the financial statements of big users of derivatives in hedging strategies, particularly the GSEs. FHLMC disclosed earlier this month that its expects a cumulative $2.5 billion hit to shareholders' equity at the end of the first quarter related to FAS 133. According to Federal Financial Analytics, Inc., the estimated $2.5 billion in paper losses won't have an immediate impact on FHLMC's core capital, but it may affect earnings over time.
Freddie Mac has priced a 4.5%, three-year EuroReference Note issue totaling 5.0 billion euros (approximately $4.6 billion). The issue, due March 15, 2004, was priced at 99.823 to yield 4.565%, 17 basis points over the three-year BTAN (French government bond) or 19 basis points over the OBL 130 (German government bond). The settlement date is March 5.
BNP Paribas, Lehman Brothers, and Merrill Lynch are joint bookrunners for the transaction. Co-lead managers include ABN Amro, Barclay's Bank, Credit Suisse First Boston, Deutsche Bank, Dresdner Kleinwort Wasserstein, Goldman Sachs, HSBC-CCF, ING Barings, J.P. Morgan, Morgan Stanley Dean Witter, Schroder Salomon Smith Barney, and UBS Warburg. There is also an eight-member selling group. "This issue, which completes our yield curve, saw a significant increase in investor participation, particularly in core European countries," said Jerome Lienhard, Freddie Mac's senior vice president for investment funding.
Things are looking up for what has been a rather turbulent ride for the RG Receivables Co.'s $100 million airline ticket receivables deal from the Brazilian airline Varig which closed in early 1998.
The deal was the first airline ticket deal from Brazil and Moody's Investors Service has recently upgraded the deal to B3 from B2 as a result of improvements in the company and increases in the volume of flights from the U.S. to Brazil on Varig. The upgrade follows Standard & Poor's upgrade of the deal in January to B+ from CCC+.
Ratings
Standard & Poor's affirmed its single-'A' financial strength, counterparty, and financial enhancement ratings on ACA Financial Guaranty Corp. (ACA). At the same time, the agency removed the ratings from CreditWatch following last Thursday's funding of $45 million in new equity capital. The outlook is stable. This funding makes good on a commitment from the company's investors and restores overall statutory capital to a level consistent with a single-'A' rated financial guarantor.
Calendar
March 13-14: New York, NY-Information Management Network is presenting 2001: A CDO Event at the Marriott Marquis. For more information, call (212) 768-2800 ext. 1 or visit www.imn.org/a286/f/.
March 26-27: New York, NY-The Strategic Research Institute will hold the fourth annual Asset Backed Commercial Paper Forum at the Grand Hyatt. For more information, call 800-599-4950 or visit www.srinstitute.com.
April 1-3: Orlando, Florida-Standard & Poor's will host its annual Structured Finance Seminar. The keynote speaker will be Robert B. Reich, the former Secretary of Labor during President Bill Clinton's first term. For more information, call Standard & Poor's Events Marketing at (212) 438-2800, or visit www.standardandpoors.com.
April 23-24: Washington D.C.-The Strategic Research Institute presents the second annual forum on Securitization of Student Loans. For more information visit www.srinstitute.com or call 888-666-8514.
May 15-18: Paris, France-The Strategic Research Institute will hold The Fourth Annual Global Securitization Symposium. For more information, visit www.srinstitute.com or call 888-666-8514.
June 4-5: New York, NY-The Strategic Research Institute will sponsor the Third Annual Forum on Collateralized Debt Obligations: CBOs/CLOs on the Go! The forum will take place at the Martinique on Broadway. For more information, visit www.srinstitute.com or call 888-666-8514.
