ABS

After resolving a few accounting issues, including the costs of utility poles, the Florida Public Service Commission gave the go ahead for Florida Power & Light to finance its costs of storm recovery from 2004 to 2005 through a securitization of about $700 million, after estimating that storm recovery costs reached $1.13 billion.

Loan sale advisor DebtX has been awarded a patent by the United States Patent and Trademark Office for its online loan sale and debt trading exchange program. This protects DebtX's innovations relating to due diligence, loan sales and debt trading that has played an important role in transforming the way commercial loans are bought and sold, DebtX said in a statement.

The non-consolidation of special purpose entities with the seller of financial assets is a prerequisite of every properly structured securitization transaction.

More consumers are using electronic disbursement services through the telephone and Internet to make last minute payments on credit cards, mortgages and other bills, according to a survey completed in April.

Responding to market participants' demand for more precise and granular measures of risk, Fitch Ratings conducted a study of the level of program-wide credit enhancement (PWCE) with a sample of large, diverse multi-seller ABCP programs in the U.S. Using VECTOR CP as the analytical tool, the study suggests that many partially-supported multiseller ABCP programs in the U.S. maintain excess levels of PWCE. This information should be of comfort to investors as it confirms the low level of risk in established U.S. multiseller programs. In addition, multiseller ABCP program sponsors may find the application of VECTOR CP useful, as it can compliment their internal credit scoring and support their risk and regulatory management objectives. A more detailed discussion with respect to the modeling assumptions and results will be presented in a report to be published by end of the month.

The Carlyle Group announced last week that it has hired John Stomber as a managing director in the leveraged finance group in New York. Stomber previously worked at Cerberus Capital Management as a managing director focused on structured finance transactions and deals with banking and securities firms.

Gun Hill Road, a $600 million securitization of revenues from film copyrights, received decent reviews last seek. The positive feedback comes several months after Deutsche Bank underwrote the transaction last January. The bank is also preparing a follow-up transaction, called Gun Hill Road II.

Babson Capital Management has closed the Connecticut Valley Structured Credit CDO III, a $400 million collateralized debt obligation (CDO) that will consist primarily of BBB rated CDO debt securities with a focus on the collateralized loan obligation sector. Citigroup Global Markets arranged the transaction.

While most industry participants have come to the conclusion that the U.S. housing market is unlikely to post rapid price declines on a nation-wide scale, Standard and Poor's last week released an updated simulation of how the RMBS market would perform in such a scenario - otherwise known as the ominous housing bubble burst.

The Bond Market Association announced last week that Robbin Conner has been appointed vice president and assistant general counsel. Conner, who will report to BMA associate general counsel Lynnette Hotchkiss, will also be the staff advisor to the Association's MBS and securitizaed products division. He will focus on the division's legal, regulatory and market practice initiatives that include such areas as MBS fails, good delivery guidelines, nontraditional mortgage products and credit default swaps of ABS.

Full Credit to Book (Equal if Joint) U.S. Public ABS Market/144A Market Managers Proceeds (mils) Rank Mkt. Share # of Issues Citigroup 5,839.9 1 23.0 12 JP Morgan 3,828.6 2 15.1 10 Wachovia Corp 2,286.4 3 9.0 5 Deutsche Bank AG 2,020.4 4 7.9 7 Merrill Lynch & Co Inc 1,847.5 5 7.3 4 Barclays Capital 1,705.7 6 6.7 4 Credit Suisse 1,550.0 7 6.1 3 Royal Bank of Scotland Group 1,479.3 8 5.8 3 Banc of America Securities LLC 1,374.9 9 5.4 1 Morgan Stanley 997.5 10 3.9 2 Industry Total 25,435.6 - 100.0 31 Source: Thomson Financial

Full Credit to Book (Equal if Joint) U.S. Public ABS Market/144A Market Managers Proceeds (mils) Rank Mkt. Share # of Issues Citigroup 12,433.7 1 16.8 20 Merrill Lynch & Co Inc 9,089.5 2 12.3 12 Banc of America Securities LLC 7,206.9 3 9.8 18 Deutsche Bank AG 6,810.1 4 9.2 11 UBS 4,824.0 5 6.5 13 Bear Stearns & Co Inc 4,685.3 6 6.3 10 Morgan Stanley 4,356.3 7 5.9 17 Credit Suisse 4,317.9 8 5.9 8 JP Morgan 2,610.9 9 3.5 12 Wachovia Corp 2,557.3 10 3.5 7 Industry Total 73,857.2 - 100.0 151 Source: Thomson Financial

Full Credit to Book (Equal if Joint) U.S. Public ABS Market/144A Market Managers Proceeds (mils) Rank Mkt. Share # of Issues Citigroup 6,682.4 1 27.3 12 JP Morgan 6,149.7 2 25.1 12 Banc of America Securities LLC 4,410.0 3 18.0 8 Deutsche Bank AG 2,549.9 4 10.4 7 Morgan Stanley 1,829.0 5 7.5 2 Barclays Capital 1,087.5 6 4.4 3 Credit Suisse 625.0 7 2.6 2 ABN AMRO 500.0 8 2.0 1 Lehman Brothers 250.0 9 1.0 1 Wachovia Corp 249.9 10 1.0 1 Industry Total 24,508.3 - 100.0 39 Source: Thomson Financial

Full Credit to Book (Equal if Joint) U.S. Public ABS Market/144A Market Managers Proceeds (mils) Rank Mkt. Share # of Issues Lehman Brothers 20,105.2 1 10.6 47 Morgan Stanley 19,425.1 2 10.2 21 Credit Suisse 18,911.9 3 10.0 38 Countrywide Securities Corp 15,001.3 4 7.9 17 Deutsche Bank AG 13,789.4 5 7.3 24 Royal Bank of Scotland Group 12,487.1 6 6.6 18 Bear Stearns & Co Inc 12,121.0 7 6.4 33 Merrill Lynch & Co Inc 11,781.7 8 6.2 16 JP Morgan 11,381.6 9 6.0 23 Citigroup 8,663.0 10 4.6 24 Industry Total 189,988.7 - 100.0 362 Source: Thomson Financial

Full Credit to Book (Equal if Joint) U.S. Public ABS Market/144A Market Managers Proceeds (mils) Rank Mkt. Share # of Issues Citigroup 4,793.6 1 21.5 7 Deutsche Bank AG 2,801.0 2 12.6 3 Credit Suisse 2,466.6 3 11.1 4 Merrill Lynch & Co Inc 2,301.0 4 10.3 2 Banc of America Securities LLC 2,027.7 5 9.1 3 Goldman Sachs & Co 1,803.8 6 8.1 2 Morgan Stanley 1,537.4 7 6.9 2 Lehman Brothers 1,284.7 8 5.8 1 UBS 998.7 9 4.5 2 JP Morgan 769.3 10 3.5 1 Industry Total 22,272.2 - 100.0 16 Source: Thomson Financial

auto ABS 9% credit card ABS 8% enterprise finance 0% equipment ABS 1% real estate ABS 72% structured settlements 0% student loan ABS 8% trade receivables 1%

Amid heightened competition, real estate investment trusts that operate within the commercial real estate sector are employing a number of strategies - from teaming up to changing course.

The Florida Public Service Commission's staff last week recommended that Florida Power & Light, a Juno Beach, Fla.-based utility company, be allowed to tap the securitization market for about $659 million. If the power company completes the transaction, it will use the funds to cover storm recovery costs.

While eyebrows were raised last week at the timing of Wachovia Corp.'s purchase of savings bank and mortgage lender Golden West Financial Corp., Golden West Chief Executive Herb Sandler vehemently denies it had anything to do with his outlook for the U.S. real estate market. Ninety-nine percent of Golden West's portfolio consists of widely criticized option adjustable rate mortgages, and more than half of those loans were originated to Californian borrowers.

Sallie Mae rolled out a new loan program earlier this month, and although one official there said the lender had no existing plans to fund it through securitization, market players think otherwise.