Deutsche Bank

GFORT 2024-4 has an interest rate mismatch between the assets and the issued notes, which could reduce excess spread in the trust to the point where it is negative.

Yield-hungry insurers, banks and exchange-traded funds fueled demand this year while a wave of redemptions crimped net supply.

The 144A deals close within a week of each other and both have eight-year maturities. Series 2024-P3 has four class A tranches compared with 2024-N3's three class As.

Among the credit challenges, is the lack of amortization on the loans, and the loans are heavily concentrated among states and MSAs.

Yields on the notes are expected to range between 6.36% on the AA- and Aa2 notes--as rated by KBRA and Moody's Ratings, respectively–to 10.08% on the BB notes, as rated by KBRA.

The current transaction will sell the most in securitized bonds since the 2022-1 series came to market with $850 million in notes.

All four of the class A tranches benefit from total initial hard credit enhancement of 13.80%, while the B and C classes of notes are covered by 10.6% and 6.0% in initial hard credit enhancement.

Known for subprime financing, the sponsor has been making inroads lending to near-prime customers in the last couple of years.

There are four risk events that could stop cash flow into SMB 2024-R1's deal—missing overcollateralization targets, a stymied principal distribution and the deals do not exercise an optional clean-up call.

The average annual cash bonus fell 2% to $176,500 in 2023, the lowest since 2019. The drop was far less dramatic than it was in 2022, when the average bonus slumped 25%.

Rising card balances—and delinquencies—might be a matter of normalization post-COVID, but securitization remains an attractive option for banks extending revolving credit, say observers.

Stronger demand for auctions and the recent popularity of the 20-year could already be compelling the department to consider increasing the size the bank's strategists say.

The synthetic securitization leaves the assets on Deutsche Bank's portfolio—the originator and arranger—making the investor syndicate a critical risk counterparty.

The loans have strong borrower characteristics, such as a weighted average (WA) FICO score of 733, and WA seasoning of 10 months.

As interest rates rise and delinquencies among borrowers with poor credit scores soar, investors are increasingly scrutinizing the riskiest slices of asset-backed securities sold by some subprime auto lenders. That's forced certain issuers to postpone deals or sweeten terms.

Some 24% of the pool has 76- to 84-month contracts. This deprives observers and investors of robust performance data, because of the lack of seasoning.

After a challenging 2022, fund flows reverted to positive territory in 2023 even though higher interest rates and wider spreads have considerably reduced the supply of securitized product.

Corporations are navigating shifting geopolitics, and M&A bankers are advising them as they consider selling off faraway units and focusing more on assets closer to home or in friendlier countries.

The 30 loans secured by 146 properties in DBJPM 2020-C9 have lower-than-average loan-to-value ratios than recent bond offerings backed by commercial-mortgage securitizations of multiple properties.

A subprime-related settlement between the government and Deutsche Bank provided meaningful benefits to some U.S. consumers in need, according to a new report. But the author acknowledged that those gains could prove illusory for some consumers given the coronavirus crisis.