ABS

Hannover Re said last week that it had completed its first insurance-linked securities (ILS) transaction.

The recent ratings action that saw Moody's Investors Service downgrade Ambac and MBIA to Aa3' and A2', respectively, and XL Capital Assurance/XL Financial Assurance to B2' from A3' is causing further concerns for the European banking sector.

As recessionary economic conditions roil on, market participants can't help but look for the next shoe to drop.

For months politicians and consumer advocates have complained that mortgage servicers have been too slow to modify the mortgages of troubled borrowers, and their calls for the industry to reduce principal balances have been met with skepticism.

The devastating number of layoffs in the structured finance industry - and on Wall Street in general - has industry participants tossing around terms like "bloodbath" or "pinstripe massacre" to depict the jarring consequences of the current economic outlook.

Considering the undisputed negative outlook for subprime mortgages, is it still possible for the ABX to overestimate expected losses on these loans? Experts say it is.

Issuance was relatively quiet last week, as the ABS market edged closer to the end of the quarter and the Fourth of July holiday.

UniCredit Markets & Investment Banking's euro-denominated ABCP conduit named Salome Funding got the green light from the European Central Bank (ECB) to begin using its repo facility.

Manager Activity: AutosFull Credit to Book (Equal if Joint) U.S. Public ABS Market/144A Market

RBS Asset Management, a subsidiary of the Royal Bank of Scotland, appointed Kate O’Neill as head of distribution.

London-based working capital management specialist Demica has released new research on the supply chain finance (SCF), citing changes over the past year and current banking attitudes toward them as a service offering.

A Goldman Sachs analyst estimates that Citigroup will face an $8.9 billion write-down in its second quarter earnings.

In a report about the June remittance reports relased this morning, JPMorgan Securities said that whether June remittance reports were good, bad or ugly depended on who was asked.

Bankers and securities industry representatives are pushing the Federal Deposit Insurance Corp. (FDIC) to go further in encouraging covered bonds as an alternative to securitization.

After a long wait for the debut of new Italian covered bonds (Obbligazioni Bancarie Garantite) in the Jumbo market, it has finally come true. Banca Popolare di Milano (BPM) started its road show and is planning to launch its first issue as part of a €10 billion ($15.7 billion) issuance program in early July.

The credit rating agency task force of the Securities Industry and Financial Markets Association (SIFMA) supports the proposal presented by the Securities and Exchange Commission (SEC) today, according to a SIFMA release.

At the request of Republican members of the House Financial Services Committee, chairman Barney Frank, D-Mass., has delayed a vote on a bill he introduced last week that would require the credit rating agencies to rate municipal, corporate and other securities based on the likelihood of repayment alone.

Lehman Brothers said Tuesday it has brought back two senior managers, and promoted two other staffers. Michael Gelband will return to serve as global head of capital markets, and Alex Kirk has rejoined as global head of principal investing. They will report to Bart McDade, the newly named president and chief operating officer at Lehman.

Fitch Ratings yesterday published an exposure draft on disclosing the retention of the equity piece risk. This move is aimed at improving transparency in the global structured finance markets.

ICBA Mortgage — an Independent Community Bankers of America mortgage subsidiary that provides secondary marketing services to members — reported yesterday that 22% of this month’s loans were insured by the Federal Housing Administration (FHA), up from last year’s 9%.