Former Banc of America banker Luis Araneda, who worked in the bank's credit card and student loan divisions, is starting a new boutique underwriting and asset-backed consulting firm, named Structured Capital Partners LLP, with offices based in Raleigh N.C. and London. In addition to structuring deals & advising both issuers and investors on the benefits of ABS, Structured Capital Partners will also be taking equity positions in structured deals. Araneda left BofA in August.
Karen Feingold is joining Norddeutsche Landesbank starting this Monday as Vice President - Senior Credit Analyst for the U.S. securities business. She will report to Stephen Hunter, SVP - Deputy General Manager. She was most recently with Coast-to-Coast Financial Corp. and previously with GE Capital, Deutsche Bank and Chrysler Capital. In her day-to-day activities, Feingold will work closely with Omar Bolli, head of asset backed finance and Alessandro Gajano, treasurer of the New York Branch.
Salomon Smith Barney has a $300 million arbitrage cash flow CLO in the early stages of equity premarketing for Metropolitan Life Insurance, according to IFR Markets. Madison Avenue IV will have five classes of debt with ratings ranging from triple-A to double-B. The transaction is expected to have 80% broadly syndicated loans, 5% middle market loans, and 15% high yield bonds as collateral. No dealers or underwriters could be reached for comment.
Despite over $350 million in exposure to bankrupt Conseco Inc., surety provider Financial Security Assurance says it is adequately protected from a potential decline in performance in its insured CNC ABS, according to IFR Markets. Subprime MBS transactions have sufficient overcollateralization and are currently performing well, according to spokeswoman Betsy Castiner. Additionally, FSA already has a backup servicer in place, to take over in a worst-case scenario.
In December, The Bond Buyer, a sister publication of ASR, reported an instance of municipal investors demanding covenants that limited issuer Elmhurst Memorial Hospital in selling healthcare receivables at a discount. These covenants will likely be part of several future municipal debt offerings, a direct impact of National Century Financial Enterprise's massive failure in November that led to several bankruptcies in the healthcare industry.
GE Business Asset Funding (GEBAF), has named three new leaders of its expanded sale/leaseback Program. Daniel Raffe, Eric Anderson, and Craig Torrence have all been named vice presidents in the company's sale/leaseback transactions. GEBAF began its sale-leaseback program in 1998, and the company is currently engaged in all phases of acquisition, structuring, and divestiture of sale/leaseback properties. These appointments comprise part of a larger strategy to strengthen BAF's sale/leaseback origination capacity.
Freddie Mac's primary participation in the subprime market beginning in 2003 will be as an investor in asset-backed securities instead of as a monoline insurer insuring subprime mortgage deals. However, the GSE will still utilize its T-Series re-Remic capabilities (structured wrapped transactions) for alternative collateral like FHA/VA mortgages and to distribute and execute guaranteed securities. According to Salomon Smith Barney, this shift by Freddie may limit home equity volume increases in 2003. Freddie wrapped transactions accounted for up to $13 billion worth of the HEL supply in 2002.
The Department of Housing and Urban Development (HUD) has increased the limits on single-family mortgages insured
by the Federal Housing Administration (FHA). Beginning Jan. 1, the new basic mortgage limit, is $154,896, while the maximum in high-cost areas is $280,749. The new FHA loan limits are based on the increase in the ceiling on conventional home loans that can be purchased or securitized by Freddie Mac, which rose 7.3% as of Jan. 1, from $300,700 to $322,700. The floor, which covers most of the nation's 3,000-plus counties, is set at 48% of the Freddie Mac limit. The ceiling, which applies to about three dozen high-cost markets, is 87% of the conforming loan limit or 95% of the median house price for the area, whichever is less.
Feb 5-8: Phoenix, Arizona Information Management Network will host ABS West 2003. For more information visit www.imn.org
Feb 9-12: Scottsdale, Arizona Strategic Research Institute will sponsor the 10th annual Asset Securitization Symposium 2003. For more information visit www.srinstitute.com.