With two weeks left in the year, Citigroup Global Markets will seemingly capture the top spot in the U.S. ABS league tables for the second year in a row, according to data maintained by Thomson Financial. Through last Wednesday, Citigroup had led more than $81 billion of ABS product to date, topping second-place Countrywide Securities, which had placed nearly $70 billion. Countrywide Home Loans Inc., however, was the leading issuer, with more than $72 billion of new-issue ABS sold to date. By a seemingly overwhelming margin, Merrill Lynch was the top CDO underwriter, with $13.5 billion sold, more than double its closest competitor, Citigroup.
Michael Plunkett has joined Hypo Vereinsbank's New York office as a director in the U.S. securitization unit. In his new position, Michael will originate and structure asset-backed transactions in a variety of asset types. He reports to Managing Director Mark Hirshorn. Plunkett comes from Diversity Capital, LLC, an investment banking and consulting boutique. Prior to Diversity, Plunkett was a vice president and senior transactor in the asset-backed finance group at DZ Bank.
Broker/dealer United Capital Markets acted as co-manager on its first third-party CDO last week, a $302 million series 2004-1 transaction for E*Trade, sources confirmed. Despite reports to the contrary however, this was not UCM's first underwriter role, as the Key Biscayne-based firm acted as sole lead manager on its own UCMAB series 2003-1 offering, which priced in September 2003 (see ASR 9/15/03). Merrill Lynch acted as lead manager on the E*Trade offering.
APOLLO CDO, the first rated credit instrument backed by commodities trigger swaps, underlying derivative assets based on commodity price levels. The swaps reference precious metals, base metals and energy. Barclays Capital acted as lead manager on the offering, which was rated by Standard & Poor's, according to a release.
Portfolio Financial Servicing Co. announced last week that it has been selected by Commercial Credit Group Inc. as a servicer of its commercial equipment lease and loan portfolio. The Commercial Credit portfolio, of an undisclosed size, consists of equipment and manufacturing loans ranging from $50,000 to $1 million in size.
Under the next Finance Bill outlined in last week's U.K. pre-budget report, U.K. domiciled securitization SPVs will be allowed to continue applying U.K. GAAP accounting standards to securitization SPVs. Researchers at Deutsche Bank Securities explained that under the international accounting standards - IAS 39 - the main standard dealing with derivatives and debt would have potentially compromised the bankruptcy remote nature of U.K. based SPVs by introducing tax liabilities.
Fannie Mae has sold $650 million of 4.45% amortizing notes via Bear Stearns on the deal. The hybrid agency debt borrows some features from ordinary agency debentures and some from MBS. The notes mature in August 2012 and are indexed to a Fannie Mae pool of 5.5% fixed-rate mortgages, and so the principal with amortize based on the rate of prepayments for the mortgage pool. Investors will receive a 4.45% coupon monthly until maturity and they will also receive principal back every month based on the rate at which the Fannie Mae 5.5% pool pays down. At maturity, the notes will return all principal that hasn't been previously repaid. The GSE has not used this type of hybrid structure since the 1990s.
Freddie Mac is poised to launch a program of affordable housing called "Home Possible." The GSE is lowering its credit score requirements so that more families will be eligible for its lowest down-payment products, said Chief Executive Officer Richard Syron. Company officials would not reveal the minimum acceptable credit score. Syron also said Freddie is expanding its multifamily program by experimenting with delegated underwriting and focusing on small multifamily loans. Freddie is also working with the National Association of Home Builders and The AFL-CIO Investment Trust to increase the supply of affordable rental housing for working families.
A group of small tobacco manufacturers last week filed an appeal of a preliminary ruling in their lawsuit challenging the validity of statutes written to protect the interests of companies that signed on to the 1998 Master Settlement, as reported by ASR sister publication The Bond Buyer. The U.S. Court of Appeals for the Second Circuit is scheduled to hear oral arguments in the appeal the week of Jan. 16, 2005. New York-based tobacco manufacturer Freedom Holdings and other small tobacco manufacturers filed the 2003 lawsuit against New York Attorney General Eliot Spitzer and Commissioner of Taxation and Finance Arthur J. Roth. They want the appeals court to rule the MSA illegal because they say it violates anti-trust law.
Vanderbilt Mortgage and Finance, Inc. and JPMorgan Chase announced they have signed an agreement whereby Vanderbilt will purchase Chase Home Finance's $4 billion manufactured housing loan portfolio. The deal is expected to be completed by the end of the year. The portfolio will be serviced by Vanderbilt and 21st Mortgage Corporation, which is based in Knoxville, Tenn. The terms of the deal have not yet been disclosed.
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