People
Stars are falling from J.P. Morgan Chase.
Whispers
People
Stars are falling from J.P. Morgan Chase.
John Rhinelander, who was appointed head of the domestic term ABS effort at J.P. Morgan Chase following the merger, has resigned, market sources said. Rhinelander had come from the J.P. Morgan side, previously heading up the bank's conduit division.
There was no word where Rhinelander will end up.
Other recent J.P. Chase departures include Steve McGarvey, Richard Lawrence and Peter Todd.
McGarvey, who worked in credit cards at J.P. Morgan, moved over to Banc One Capital Markets, while Todd has ended up at Dresdner Bank.
Deutsche Bank managed to nab Lawrence, who was named a vice president, concentrating on auto ABS.
Meanwhile, Deutsche lost Lisa McLean.
Stan Stratton, who worked in CBOs at Jeffries & Co. has landed as a managing director at Bank of America.
The Mortgage Bankers Association of America has hired two new directors for its research department and promoted one of its economists. Emile J. Brinkmann was hired as senior director and will lead the development of a comprehensive commercial/multifamily database, the MBA said. Brinkmann was previously a senior economist at Fannie Mae, and was an assistant professor of finance at the University of Houston from 1990 to 1996. Phillip Colling was hired as a director in the research department, where he will work on MBA policy positions in areas such as fair lending and the programs of the Federal Housing Administration and the Department of Veterans Affairs. Mr. Colling comes to the MBA from the Chicago Board of Trade, where he designed futures and options contracts, and served as an economist with the Economic Research Service of the U.S. Department of Agriculture from 1992 to 1996. M. Veronica Warnock, who joined the MBA as an economist in 1998, has been promoted to senior economist.
News
Bank of America has announced that it will more than double the positions at one loan fulfillment center and add about 200 jobs at two loan servicing centers. About 390 associates working in BofA's Richmond, Va., mortgage servicing center will be re-deployed to an expanded Richmond fulfillment center, bringing the total positions there to about 700, the company said. About 100 jobs each will be added to the Buffalo, N.Y., and Louisville, Ky., servicing centers, bringing the total positions at each to about 650. Kevin Shannon, president of Bank of America Consumer Real Estate, said the company hopes to double its share of the consumer real estate market, to 12%-15%, over the next three to five years.
Standard & Poor's has placed its ratings on several structured finance transactions from Argentine issuers - including some mortgage-backed securities transactions - on CreditWatch with negative implications. The rating action follows S&P's decision to place the local and foreign currency ratings of the Republic of Argentina on CreditWatch with negative implications, reflecting "the heightened risks to the government's economic program stemming from the current political crisis." Two major concerns surround most of the transactions: credit risk, and transfer and convertibility risk. S&P said it expects to resolve the CreditWatch listing in the next few weeks, depending on whether the government is able to resolve its difficulties.
Fitch downgraded several CDOs last week. The rating agency knocked two classes of St. George Funding to AA' from AAA', due to a downgrade of CGA to AA', which provides an insurance policy on the deal.
Fitch also downgraded one class of notes of Eisberg Finance Ltd. from B' to CCC' due to the deterioration in credit quality of several of the underlying assets. Fifteen million worth of securities were hit.
Additionally, the rating agency has placed four CBOs primarily backed by high yield bonds and loans on rating watch negative.
The affected securities are: three classes of Summit CBO I Ltd. worth $79 million; five classes of South Street CBO 1999-1 Ltd. worth $72 million; one class of ML CBO IV 1996-PM-1 Ltd. worth $65.5 million; two tranches of Pacific Life CBO 1998-1 Ltd. worth $70 million.
The rating agency cited the increased levels of defaults as well as the deteriorating quality of each portfolio.
Fitch downgraded a series of three BVFMAC franchise loan securitizations. The rating agency cited a write-down due to the liquidation of convenience store operator Blue Sky Petroleum, which has been on the work out for a number of months. The impact of the BSP on the credit enhancement was only reported in this month's BVFMAC remittance reports.
The BVFMAC made the BSP loan back in December 1997. The collateral for the loan was comprised of 31 fee and 4 leasehold units. Because of poor management, BSP defaulted on the loan that resulted in the company being placed in receivership and the firm being forced to sell the collateral units via a bidding process.
A whole business securitization is in the pipeline for Tees and Hartlepool Port Authority. Deutsche Bank will lead the transaction which is expected to total GBP310 million. THPA Finance Limited will be the issuing entity, and will on-lend the proceeds to THPA, Humberside Sea and Land Services (HSLS), Powell Duffryn Storage Limited (PDSL), and Tees and Hartlepool Pilotage Company Limited (Pilotage). The issue will be split into two fixed rate and two floating rate tranches. Classes A1 and C (GBP60m and 30m respectively) will pay a margin over Libor, and the GBP150m A2 class and the GBP70m B piece will be fixed rate. Glas Cymru, a non-profit company which was recently approved to go ahead with the GBP1.8 billion acquisition of Welsh Water, is another borrower close to finalising a whole business securitisation. Schroder Salomon Smith Barney and Royal Bank of Scotland will lead this offering.
N-45 First CMBS Issuer Corporation brought its roadshow for its upcoming CMBS deal to Toronto last Thursday, with unofficial price talk in the +90 region. Some market sources said that they were not happy with the deal, citing its concentration both geographically (around 75% Ontario) and by type of mortgage (office and retail) and small number of properties (6).
In the U.S., CMBS issues that are as concentrated as this one are normally traded at 20-40 basis points more than more broadly diversified issues. However, the loan to value, high-grade properties and terrific credit of the issue all suggest that it is fairly priced in the +90 region of current price talk.
The Caisse will be issuing C$358 million in CMBS, the biggest Canadian CMBS deal to date. Of that amount, C$268 million will be a AAA-rated tranche with a seven-year weighted average life offered to institutional investors. Tranches B and C, rated "AA" and "A", respectively, will be offered retail.
The syndicate for the deal will be led by CIBC World Markets together with Scotia Capital, National Bank Financial, RBCDS, Laurentian Bank Securities, and Desjardins Securities. Roadshows were held in Montreal and Quebec City on March 22 and Winnipeg on March 23. This Tuesday there will be a roadshow held in Vancouver. An investor conference call will be held on the same day, with books set to open shortly thereafter. Closing is expected April 6.
