CDOs

The financial crisis reached its apex in fall 2008 when major Wall Street firms collapsed. But for the big three rating agencies - Moody's Investors Service, Standard & Poor's and Fitch Ratings - the crisis began at least a year before, when they started issuing massive downgrades of RMBS.

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.

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.

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.

Bram Smith, the executive director of the Loan Syndications and Trading Association (LSTA), yesterday testified before a congressional subcommittee, arguing against proposed rules that would require CLO managers to retain a 5% interest in their funds.

Deerfield Capital Corp. and CIFC have closed their merger. The new firm will now be called CIFC Deerfield Corp.

Investors have proven slow to return to the European securitization market. The limited appetite has been matched by a lackluster amount of securitization supply that market analysts said has created an imbalance in secondary and primary securitization pricing.

Moody's Investors Service will be extending the comment period on proposed changes to its modeling framework for cash-flow CLOs.

The Federal Deposit Insurance Corp. (FDIC) is expected Tuesday to propose new capital requirements for certain swap participants, as well as guidelines for adjusting the premiums of large banks.

The efforts of five Wisconsin school districts to recoup their ill-fated $200 million investment in CDOs have received reinforcement in the form of possible Securities and Exchange Commission (SEC) action against an investment bank for its role in the transaction.

Like a pesky cold, the loan market just can’t shake the “skin in the game” provision — a risk retention rule in the Dodd-Frank bill that would require “a securitizer” to retain 5% of the assets of a securitized vehicle.

Fitch Ratings downgraded four senior tranches from three European CLOs of leveraged loan transactions.

Churchill Financial Group is jumping on the business development company bandwagon.

While saying JPMorgan Chase & Co. had enough capital already to comply with new Basel III requirements, Jamie Dimon, the bank's chairman and chief executive, said regulators had gone too far in crafting the international capital accord.

The Securities and Exchange Commission (SEC) announced Tuesday that Wells Fargo Securities agreed to settle charges that Wachovia Capital Markets engaged in misconduct in the sale of two CDOs tied to the performance of RMBS as the U.S. housing market was beginning to show signs of distress in late 2006 and early 2007.

KKR plans to offer a closed-end fund that invests in loans and other fixed-income securities issued by below-investment grade companies.

Jay Hohman has landed a position as managing director at Cohen & Company Capital Markets.

Investors have proven slow to return to the European securitization market. The limited appetite has been matched by a lackluster amount of securitization supply that market analysts said has created an imbalance in secondary and primary securitization pricing.

Formulating the rules to implement the Dodd-Frank Act has proven to be challenging. Regulators both missed and moved deadlines to accomplish this monumental task.

The FDIC held a meeting March 29 to discuss its risk retention rules and the much debated QRM qualification.