ABS

INTRODUCTION

According to figures as of Sept. 29 from the ASR Scorecards database, $55.96 billion in public ABS was issued year-to-date in 2011.

The adage "Where there's smoke there's usually fire" probably explains the concerns about regulators' queries into whether REITs still warrant an exclusion permitting them to use significant leverage in their business models. The issue is especially relevant since REITs are primary buyers of agency RMBS and many view them as the likeliest buyers of private-label RMBS when that market's health returns .

Not too long ago, Turkey's Sekerbank was a name with no resonance in the structured finance world. Then, in mid-summer, the bank issued a covered bond deal that broke two barriers. It was the first of its kind from Turkey and the first covered bond globally to be backed by SME loans. Some covered bond purists even questioned whether SME collateral disqualified an instrument from being called a covered bond, which are overwhelmingly secured by mortgage pools. Turkish law has two separate regulations, one for covered bonds backed by mortgages and another for those secured by any of a wide range of other assets.

Three to four years removed from the time non-Agency RMBS and housing markets began to collapse, this article provides a historical performance update of the subprime loan sector for vintage years 1997 through 2008. Performance of the 2005, 2006, and 2007 vintages is far and away worse than for any other year, even prior to 2000 when subprime lending was still fairly new. In addition, the extent of negative equity in the borrower repayment pipeline for never-modified and at-least-once-modified subprime loans for the 2005, 2006 and 2007 vintages is measured. Given the extreme and broad corrections in residential property prices since approximately mid-2006, the mortgage repayment struggles of borrowers, and the intended effects of loan-modifications, negative equity density has been pushed to the performing and early-stage delinquency end of the pipeline. That is, modifications have resulted in a larger share of performing (active and current) borrowers with significantly more negative equity than otherwise would be the case had a loan modification not occurred.

Manager Activity: Autos Book Runner Amount (US$ Mil) Rank Mkt.

Although there is a lot of talk on renewable energy, specifically solar financing, in the esoteric space, there are other assets giving the non-traditional sector life.

American Airlines is issuing a structured finance deal comprising $725.7 million of Class-A passthrough certificates., according to Moody's Investors Service.

Structured finance can play a role in freeing the Eurozone from its debt mire, said London-based boutique shop Bishopsfield Capital Partners in a report released today.

Fondo De Amortizacion del Deficit Electrico (FADE) has set price guidance on its two-year bond, according to a Dow Jones report.

Esoteric or non-traditional assets continue to gain momentum by claiming a bigger piece of the securitization market.

In removing about 134 tranches of future flow deals from its structured finance bucket, Moody’s Investors Service will no longer apply regulatory rule 17g-5 to them, said a spokesman for the agency.

Moody’s Investors Service has modified its criteria for what counts as a structured finance instrument, the agency said today.

Dislocation in the primary market continues to highlight value in some of the more non-traditional asset classes.

European structured finance company Bishopsfield Capital Partners has hired Arjan van Bussel as a new partner to boost its advisory, real estate and structured finance businesses.

Moody's Investors Service has assigned provisional ratings to the $50 million whole business securitization from NuCO2.

The Securities and Exchange Commission (SEC) today voted (4-0 today) unanimously to propose a rule intended to prohibit certain material conflicts of interest between ABS sellers and investors.

Marathon Asset Management hired three new partners for its structured and corporate credit businesses.

ASR just launched a weekly video news update to give our readers a quick rundown of breaking news throughout the week.