ABS

U.S. credit card ABS performance remains stable as late-stage delinquencies continue to improve.

As the hunt for yield sends investors looking further down the credit curve in CMBS and RMBS land, market sources said that another good place to look might be in esoteric asset classes.

Dealer floorplan ABS losses currently remain low, with performance metrics within range of historical levels. U.S. dealer networks have been exhibiting some stability and improvement in certain areas since the middle of last year. With the U.S. economy and auto industry stabilizing, automobile sales have picked up, all contributing to higher dealer profits as dealership costs declined, a notable change from the tremendous stress that dealerships were feeling in 2008 and the first half of 2009.

After experiencing a barrage of criticism for their tardy downgrades, the top three ratings agencies are seeking to regain credibility by tailoring their research efforts to better meet the needs of investors.

The defining characteristic of the economic downturn of the last few years has been the collapse in real estate prices from their 2006 peak. The losses have impacted the economy in a variety of ways. Aside from devaluing many families' single largest asset, declining home prices removed the equity extraction that had been juicing consumption for years. The housing crash has also impacted the labor markets by both destroying many high-paying jobs in the construction trades and impairing the mobility of workers saddled with negative equity.

Although covered bonds and ABS are starting to be regarded as alternatives to one another, market experts said that these two markets could definitely co-exist. For one, these products have very different sets of buyers. The two also have varying liquidity and structural advantages and constraints.

The old adage of one man's junk is another's treasure could be the best way to describe the situation that is creating a schism in CMBS land today.

Despite the devastation in the wake of the global financial crisis, there are certain areas of the securitization market that present opportunities for investors.

In terms of issuance, diversified payment rights (DPRs) deals have made a poor showing so far this year, with Scotiabank Peru the only originator to have hit the market.

As of press time, the Argentina province of Chubut was approaching the finish line for the issuance of a $150 million deal backed by oil and gas royalties.

Mortgage prices across most of the stack are sitting at record highs, while mortgage rates are near record lows.

Last June the Basel Committee released the calendar for implementing adjustments to the Basel II market risk framework.

For 1H10, public ABS issuance reached $25.76 billion, according to preliminary figures from the ASR Scorecards database. This figure dropped from $50.7 billion for 1H09.

Knight Capital Group launched sales, trading and research services for fixed-income investment advisers with a group brought over from Morgan Stanley, the firm said Wednesday. The financial services firm has been expanding its various fixed-income groups recently.

TAL Advantage IV, a wholly owned subsidiary of TAL International Group, has completed its offering of $197 million fixed-rate secured notes.

Several deals have come to market backed by different asset classes from issuers in various parts of the globe.

Fitch Ratings will apply its updated surveillance criteria in a review of its ratings on U.S. FFELP student loan ABS. The review includes subordinated bonds, the agency announced today.

Entaire Global Co. named Daniel Courchesne as senior vice president and director of strategic investments and financing, the firm announced today.

The Student Loan Corp. is in the market with a FFELP-backed student loan transaction. Citigroup Global Markets is the lead manager on the deal.

The New York Federal Reserve will engage in coupon swaps to help facilitate the delivery of approximately $9.2 billion in currently unsettled FNMA 5.5% pools, the regulator announced this morning.