Robert Villani has joined Thacher Proffitt & Wood as a partner in its structured finance group. In addition to his legal background, Villani most recently worked in the structured finance originations group at JPMorgan Securities. His focus will primarily be auto loan and lease ABS, trade receivables, CDOs and other non-mortgage assets.
Hayes Lemmerz International, Inc. recently obtained approval from senior secured term lenders to amend its credit agreement allowing the company to establish a securitization program totaling up to $100 million. Although the company expects to finalize the securitization program prior to year-end, there was no certainty as to if or when the program would be completed, or which underwriter was arranging the facility.
ABN AMRO acquired the remaining interest in Servimedia SGFTC, Portugal's largest securitization fund management company an undisclosed amount, the company announced last week. Servimedia was established jointly in 2001 by ABN AMRO and Banco Comercial Portugues, which ABN AMRO bought out for this transaction. Motivations for the deal included the desire to consolidate servicing capabilities for securitization clients in the region, ABN AMRO said in its release. Clients of the servicer include Interbanco and Caixa Economica Montepio Geral.
G.E. Commercial Finance announced that it was licensing out its entire loan origination, syndication, servicing and portfolio management to Fidelity National Financial's ACBS product line. Previously, just the corporate financial services and healthcare financial services groups had used ACBS.
Rep. Barney Frank (D, Ma.) opposed last week increased funding for the Office of Federal Housing Enterprise Oversight in its investigation into Fannie Mae accounting practices. Citing his desire for the public release of a report on the impartiality of OFHEO, Frank expressed concern over increasing the oversight committee's budget to $59.2 million from $39.9 million before it continues with its investigation into Fannie Mae's accounting practices.
Standard & Poor's reported that it has become increasingly concerned by several developing trends in the CMBS market. S&P cited the following troubling developments: deteriorating underwriting and origination standards for commercial mortgage loans, relaxed capital expenditure requirements, tenant improvement and leasing commission reserves, an increasing number of interest-only loans or loans with interest-only periods appearing in pools; and relaxed adherence to structural and legal safeguards. Additionally, S&P said the CMBS landscape is increasingly characterized by increased liquidity, fierce competition, an influx of new buyers, and a CDO market-focused mindset. These factors, added S&P, have dramatically altered the supply/demand dynamics of the market, possibly making future CMBS deals more susceptible to negative credit events.
A first-of-its kind securitization of negative equity-home loans - with LTVs topping 140% - from Hong-Kong based issuer Pan Asian Mortgage was marketed last week to investors, according to the South China Morning Post. The Post reported that with a minimum return of 2.33%, based on the 5.125% prime lending rate, the $260 million deal was well received by about 50 institutional investors. The notes are expected to generate indicative rates of return of prime minus 280 to 260 basis points for the $220 million A tranche, and prime minus 125 to 150 basis points for the $40 million B tranche. Meanwhile, coupon returns will be derived from cash flows from repayments on a $1.2 billion portfolio of mortgages originated in 2002 and 2003 by Pan Asia Mortgage along with participating banks Citic Ka Wah and Asia Commercial. For further coverage, see next week's ASR.
Bank of America Corp. placed $1.1 billion of credit card loans on the block and expects to sell them this year, reported ASR sister publication American Banker. These loans are part of the portfolio that BofA acquired when it purchased Fleet-Boston Financial Corp. last April, according to a 3Q04 filing made by BofA last Tuesday. FleetBoston bought a $1.5 billion subprime bank card portfolio from Circuit City Stores towards the end of 2003. However, BofA didn't specify whether the expected sale would include loans from the said portfolio.
Countrywide Financial Corp. purchased mortgage servicing rights worth $8.2 billion in October, which is higher than its average purchases of roughly $2.4 billion for each of the previous 12 months. This information was reported in Countrywide's volume summary for October released last Tuesday. The buying occurs with the backdrop of Countrywide's third-quarter mortgage production decreasing to $77 billion, which is a 27% year-over-year drop. Experts said that, in the last six months, the firm's servicing purchases have been rising.
Mutual fund company Fidelity Investments last week reportedly slashed the price of online bond trading for retail investors, a move furthering its bid to generate more American fixed-income business. Along with this move, the company has also introduced pricing caps for its retail brokerage bond-trading concessions. The minimum concession to buy or sell a bond is currently $19.95, while the maximum is now $500. This is regardless of the number or type of bonds, or whether the trade is executed online or through a Fidelity telephone or branch representative.
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