Orrick Herrington & Sutcliffe has boosted its Asian structured finance practice with the hire of Michelle Taylor as partner in its Hong Kong office. She joins the firm from Paul Hastings where she was also a partner. Taylor has several years experience in the Asian securitization business; working on several notable deals including the first CMBS in China and first future flow ABS from Korea. "We are excited to add someone like Michelle who is extremely bright and energetic and is exceptionally well-regarded by the most active international investment banks in the sector," said Al Sawyers, co-head of the firm's structured finance practice. "We believe the potential for continuing growth in the structured finance sector in Asia is enormous, and Michelle is among the very few practitioners in the region who currently is focused solely on structured finance and capable of building a leading practice in Asia."
Mayer Brown Rowe and Maw, which will open an office in Hong Kong on Jan. 1, is seeking to boost its Asian presence. Aside from broader regional objectives, the move will enable the firm to help clients do business in China and assist Chinese companies with their international aims. Mayer Brown has hired Jeffrey Chen from Jones Day to head the practice. The firm is also interviewing other lawyers to join its new office with the intention of having a team of between 10 and 12 within the next 18 months. Chen specialized in securitization at Jones Day, and his new employers are eager to tap into his expertise in the immediate future. "Initially, the Hong Kong office will focus on securitization and structured finance throughout Asia, but will soon provide a broad range of legal services to local Asian companies seeking advice regarding the U.S. and Europe, and to foreign companies operating in Asia," the firm said in a statement.
Robert Levy was promoted to chief financial officer for American Mortgage Acceptance Co. and its external advisor CharterMac. Levy had served as director of capital markets since 2001. Alan Hirmes, who served as AMAC and CharterMac's CFO, is stepping down from his position, but will remain on AMAC's board of trustees and as chief operating officer of CharterMac. Matthew Stern was promoted to director of capital markets for both companies.
After much discussion over the past couple of years, the first public German nonperforming loan securitization finally made its way on to the European markets. The 1.34 billion Bluebonnet Finance plc will pool a mixture of non-performing (50%), sub-performing (26%) and performing (24%) loans acquired by the private equity firm Lonestar, which has been very active in the German NPL sector in recent years. "The performance of Italian NPL securitizations, barring one or two blips, has been good, although the majority of deals have now paid down substantially or have been called," reported analysts at Dresdner Kleinwort. "As such, despite the fact that year-end is rapidly approaching and the deal will require some intensive credit work, we would expect the deal to be meet significant interest as a diversity play for investors, assuming the price is right of course."
Calyon began marketing its first deal from its new conduit, Rivoli Pan Europe. The 479.8 million ($635.5 million) pan European CMBS, Rivoli Pan Europe 1, is backed by five loans with 24 properties in France, Spain and Holland, with an LTV of 58.12%. Structured with tranches rated from triple-A to a single-A, the deal has tenors range from 5.7 to 7.7 years.
Merrill Lynch last week launched a new U.S. Agency Collateralized Mortgage Obligation Index series that is set to track this sector's performance. The Index now has 1,173 constituents that have a total capitalization of over $363 billion. Data sets of returns and risk characteristics are available dating back to December 1996. More sub-indices are also available that classify the market according to tranche type and average life. The CMO Indices are compiled every day and are available, along with Merrill Lynch's entire compliment of over 3,500 bond indices, on a wide variety of distribution platforms, which includes the Merrill Lynch Global Index System that can be accessed on Bloomberg or the Merrill Lynch Index Web site at www.mlindex.ml.com or www.mlx.ml.com, an institutional client Web site. The reference ticker for the Index is CMOS.'
Fitch Ratings released a new study last week titled "Fitch Global Structured Finance 1991-2005 Default Study," which examines the default experience of Fitch-rated global structured finance securities over the period of 1991 to 2005. According to the study, there is a strong relationship between Fitch's structured ratings and default risk, with investment grade rated issues exhibiting lower default rates over one and multiple year periods than speculative grade rated bonds. Over the 15-year period, the average annual default rate across Fitch's investment grade structured bonds was 0.13%, while the speculative grade average annual default rate was 3.4%. More specifically, the highest average annual speculative grade default rate was the CCC' rate of 24.9%.
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