Paul Weiss Rifkind Wharton & Garrison has hired Robert Zochowski from Shearman & Sterling for its New York office. Weiss's practice focuses on complex structured finance and securitization deals, specifically films, patent royalties and energy. He was a partner at Shearman for more than seven years. Alfred Youngwood, the chair of Paul Weiss said, "Bob will add significant depth and resources to our finance practice, and will be a tremendous augmentation to our strong complex securitization practice."
Morgan Stanley announced last week that David Spector, who was previously at Countrywide Financial Corp. as senior managing director of capital markets, would join its London office in September to build its RMBS practice in Europe. Last June, Morgan Stanley hired two executives from Fremont General Corp. to start a wholesale unit that will fund home loans in the U.S.
Dominion Bond Rating Service appointed Richard Bianchi vice president of the rating agency's business development team, covering issuers and investors in U.S. ABS and ABCP groups. Bianchi, who will be based in New York, will report to Darren Davies, managing director for structured finance business development. Prior to DBRS, Bianchi spent more than eight years at WestLB in the asset securitization group originating new transactions, managing existing relationships and developing and restructuring ABCP vehicles. Before that, he spent three years at Credit Lyonnais in the structured finance group where he focused on securitization transactions for financial institutions. "Richard's overall structured finance experience will provide value to clients and broaden DBRS's ability to cover both issuers and investors in the ABCP and term securitization market segments," said Davies in a release.
Baker & McKenzie securitization partner Paul-Michael Rebus has quit the firm and will join McDermott Will & Emery in London. Rebus is the second structured finance partner to join McDermott's London office in the last six months. In March, McDermott added Nick Terras, who was previously a banking partner at SJ Berwin. The duo will work together on the structured finance end of the practice in London. Rebus has advised financial institutions in the U.K., U.S. and across Europe on structured finance matters and securitizations of asset classes including trade, auto and loan receivables and commercial and residential mortgages.
Clifford Chance has hired a team of associates from Freshfields Bruckhaus Deringer's Amsterdam office. Wouter van der Gaag joined the firm at the end of July, and Sander Klaassen and Robert Masman will join the firm this month. All three specialize in structured finance and securitization. Klaassen and Masman both join as senior associates, and van der Gaag joins as a junior associate.
The Bond Market Association said last week that Manfred Schepers, head of its international division in London, would leave the organization to be part of the European Bank for Reconstruction and Development. The BMA said that Schepers would join the EBRD in October as vice president for finance.
U.K. mortgage lender Alliance & Leicester disclosed plans of initiating a residential mortgage securitization program in the second half of 2006, in order to manage the group's funding and liquidity requirements. Lloyds TSB and HSBC announced similar plans in recent months. With A&L's joining the bandwagon, it means that all top 10 U.K. mortgage lenders will have securitization programs in place.
Last week Dominion Bond Rating Service released its CDO Toolbox model on its corporate Web Site. The model release is an integral part of the rating agency's global CDO strategy. The CDO Toolbox is made to analyze tranche ratings of single or multiple portfolios of credits, based on default and correlation assumptions. The model was designed to be flexible and transparent, allowing users to specify correlation among the assets, recovery levels and default assumptions, among other things. The newest release is the latest update to the CDO Toolbox developed to facilitate the CDO structuring process. "The latest model release demonstrates DBRS's responsiveness to the market's requests for flexibility and transparency, in accordance to the evolving nature of transactions being contemplated. The group will continue to update the CDO model and develop new ones to cater to new structures and asset types in the CDO market," said Jireh Wong, senior vice president in CDOs. The CDO Toolbox also allows users to perform scenario tests by setting up credit migration and default scenarios as well as studying the impact of those scenarios on the required tranche subordinations for certain target ratings.
The American Securitization Forum last Monday issued a set of policy recommendations that the association thinks should be considered in connection with any legislative, regulatory or market-based reforms to the current framework of credit rating agency oversight. The policy recommendations have four major goals: promote the independence of credit rating agencies; enhance competition among credit rating agencies; promote greater transparency; and better disclosure of credit rating agency criteria, methodologies and ratings outputs; and streamline the process for determining which credit rating agencies receive governmental designation. The ASF's Credit Rating Agency Task Force formed in 2005, developed the recommendations that were recently approved by ASF's Board of Directors.
According to a Bear Stearns report, gross agency issuance in ARMs for July came in at $12.1 billion. This is almost unchanged from its level in June. In terms of agency hybrid issuance as a percentage of total agency MBS issuance - which includes FNMA and FHLMC only - reached 20%, which stayed steady from June. Meanwhile, agency hybrid issuance has steadily improved after hitting a $7.9 billion bottom last April. But elevated mortgage rates and decreasing home price appreciation will lead to lower mortgage originations in 2006 compared to 2005. This, combined with a flat curve, is probably going to keep hybrid origination in the second half of 2006, as well as hybrid issuance, at lower levels compared to 2005 and the first half of the year. Bear Stearns projects total agency hybrid issuance for the second half of the year to be around $60 billion, less by approximately 30% from its level in the second half of 2005 and 2004.
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