ABS

Standard & Poor's, along with Moody's Investors Service and Fitch Ratings, downgraded billions of dollars structured transactions in the summer of 2007, resulting in a wave of criticism. So when Deven Sharma was named S&P president on Sept. 1 of that year, he kicked off a reform program that continues today.

Under the brand esoteric comes an array of asset classes. Right now the industry is seeing whole business deals such as the issuance of a $220 million transaction for Church's Chicken earlier this year.

The Securities and Exchange Commission (SEC) today voted unanimously to propose amendments that would remove references to credit ratings in several rules under the Exchange Act.

Drive-in restaurant chain Sonic Corp. said that certain of its subsidiaries are going to refinance their outstanding securitization debt with a new securitization debt facility. The underwriter on the transaction is Barclays Capital.

Turkey’s DenizBank has issued €300 million of bonds backed by diversified payment rights (DPRs) through five series of notes via WestLB. The transaction was a club deal, going to multilaterals the European Investment Bank (EIB), the European Bank for Reconstruction and Development (EBRD), the International Finance Corp. (IFC) and the Deutsche Investitions- und Entwicklungsgesellschaft (DEG). The arranger itself took a piece as well.

When global regulators last year announced final international capital and liquidity standards, bankers for the first time in months breathed a sigh of relief, appearing even to welcome the agreement.

An ABS backed by diversified payment rights (DPRs), through Banco Santander Brazil, is currently making the rounds on the private placement market.

Deutsche Bank Securities hired Douglas Runte as a managing director and head of aviation debt research within its markets division.

Avis Budget Car Rental is marketing ABS backed by rental fleet vehicles totaling $600 million.

Sole lead Santander Investment Securities priced today a $160 million, 10-year deal backed by payment obligations linked to a pool of equipment that Mexico’s Corporacion Geo uses to build houses, said a source close to the deal. The yield came to 9.75%. Fitch Ratings and Standard & Poor’s rated the deal ‘BB-’. Fitch said that the rating is linked directly to the ‘BB-’ rating of Corporacion Geo, as the company is on the hook for the payments. The payments are made under the terms of a service agreement entered into by Corporacion Geo, various of its units, and Geo Maquinaria in exchange for the machinery utilization services for Corporacion Geo and its units.

Navistar Financial Corp. (NFC) is issuing a $120.1 million trucking and equipment loan securitization.

The European Union (EU) and U.S. regulators might be on the same page when it comes to trying to get the securitization market to be more risk averse. However, their different approaches have left a gap that needs to be eventually bridged, industry sources said .

With the bulk of Kazakh transactions backed by diversified payment rights (DPRs) having been paid down over the past few years, it is refreshing to see that ATF Bank is extending the life of its outstanding DPR notes, even with only $100,000 left.

Turkey’s Denizbank is out with a $300 million structured deal consisting of five series, all scoring ‘BBB+(exp)’ from Fitch Ratings. West LB is the arranger. No word yet on whether private-sector investors are potential buyers but one market source said that a multilateral is buying at least a portion of the deal. In an interview with ASR earlier this year, Noel Edison of the European Bank of Reconstruction and Development had indicated that the institution would be funding additional Turkish banks this year via DPR programs following a deal in late 2010 with Garanti Bank.

The European Central Bank (ECB) is reportedly publishing a letter later this month outlining plans for a data warehouse of underlying loans that back ABS deals.

Scottish Re Group has entered into agreements to unwind the 2005 Orkney I securitization deal as well as to cede the Orkney block of business to Hannover Life Reassurance Co. of America.

Barclays Capital announced in an internal memo that Diane Rinnovatore will become co-head of securitized products origination (SPO) along with with Cory Wishengrad, who is currently co-head of SPO and head of the esoteric ABS origination group at the bank. He has been running the Barclays esoteric ABS business since late 2008.

Under pressure from Congress, federal regulators issued proposals this week that would exempt corporate end users of derivatives from new margin requirements, but force them to maintain sufficient capital in case of future losses.

The increase in appetite for esoteric ABS hasn't been solely for on-the-run assets, the market is increasingly looking at off-the-run assets that often require more work to get done.

Enterprise is marketing a $750 million rental fleet ABS. The capital structure includes one $750 million tranche of floating rate variable funding asset-backed notes with a final payment date October 3, 2017. The offering has been rated 'Aaasf' by Moody's Investors Service.