CDOs

Leveraged super-senior trades - which are gaining popularity in the European market - are close to making a debut in the publicly rated U.S. synthetic CDO market, with at least one rating agency looking at five of the deals. The deals achieve their leverage, generally eight-to-12 times above the super-senior tranche, by posting only a portion of the collateral's notional amount but receiving the full spread. Further separating the leveraged super-senior from a senior synthetic CDO tranche, the arranger has the option to unwind the transactions and transfer mark-to-market swap costs to investors.

After an 18-month struggle, the path is finally clear for Houston-based CenterPoint Energy to issue its $1.89 billion stranded cost ABS. Last week, the Texas State Attorney General's office and other groups that had previously opposed the deal agreed not to lodge another appeal, removing the final roadblock for CenterPoint to bring its deal to market. Sources say the deal could be in the market by the end of the year.

Deals from Drive Financial Services and DriveTime, two regular nonprime auto ABS issuers, will no longer be in danger of being confused for one another. That is because the Dallas-based Drive Financial recently sued Phoenix-based DriveTime in order to force that company to stop using the name DriveTime in relation to its ABS deals, according to a source close to the situation.

The long dormant aircraft sector may be getting a shot in the arm soon as two issuers are expected to bring deals in the coming months. G.E. Capital Corp. and debis AirFinance are reportedly planning aircraft lease-backed deals soon, according to a source familiar with the deals. Neither Stamford, Conn.-based G.E. Capital nor Amsterdam-based debis responded to inquiries about the possible deals.

Kingdom Films LLC - a conduit facility created to finance the production, acquisition and distribution of the next 32 live action films that will be produced or acquired by The Walt Disney Co.- closed a private $370 million revolving credit facility last week, said a Walt Disney spokesman who declined to be named. Credit Suisse First Boston acted as the financial advisor and arranger for the transaction.

The ABS primary market generated $20 billion in new issues last week, even as many in the market cooled their heels on summer vacations.

The Metris Cos. Inc. spent three years turning itself around and by this year looked like it finally had the wind at its back. Still, it was not surprising that it decided to sell, given what has been happening in the card industry - consolidation, a cost-of-funding disadvantage versus larger players like its buyer, HSBC Holdings, and coming policy changes that some say influenced Metris' thinking.

Homeowners aren't the only ones scrambling to take advantage of persistently low long-term interest rates - corporations in record numbers are exercising call options on their unsecured obligations in order to lock in low rates while the window to favorably refinance still exists. The result: high yield CBOs are paying down and performing at record levels, making investors that bought those bonds cheap experience a much greater profit than anticipated.

E-Trade Consumer Finance Corp. has said it will keep $3.3 billion of recreational vehicle and boat loans on its books as whole loans, following the sale of its RV and boat lending to G.E. Consumer Finance last week.

Year to date as of 08/18 Term (days) 08/12 08/15 08/16 08/17 08/18 1-week

Full Credit to Book (Equal if Joint) U.S. Public ABS Market/144A Market Managers Proceeds (mils) Rank Mkt. Share # of Issues JP Morgan 8,506.9 1 15.1 14 Merrill Lynch & Co Inc 7,246.0 2 12.9 9 Deutsche Bank AG 6,280.7 3 11.1 12 Citigroup 6,220.1 4 11.0 11 Banc of America Securities LLC 5,684.6 5 10.1 9 Credit Suisse First Boston 4,561.9 6 8.1 9 Barclays Capital 4,302.5 7 7.6 8 Wachovia Corp 3,712.5 8 6.6 8 Goldman Sachs & Co 2,293.6 9 4.1 3 HSBC Holdings PLC 2,063.0 10 3.7 4 Industry Total 56,395.6 - 100.0 55 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 Merrill Lynch & Co Inc 16,256.7 1 19.6 24 Citigroup 11,555.2 2 13.9 24 Wachovia Corp 6,669.9 3 8.0 13 Morgan Stanley 6,100.9 4 7.3 24 Lehman Brothers 4,715.7 5 5.7 15 Bear Stearns & Co Inc 4,661.2 6 5.6 13 UBS 4,453.1 7 5.4 11 Deutsche Bank AG 4,379.6 8 5.3 13 Banc of America Securities LLC 3,470.6 9 4.2 17 Credit Suisse First Boston 3,293.0 10 4.0 8 Industry Total 83,116.1 - 100.0 199 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 JP Morgan 7,833.0 1 26.1 18 Citigroup 4,648.3 2 15.5 15 Barclays Capital 3,248.9 3 10.8 12 Deutsche Bank AG 2,874.7 4 9.6 13 Banc of America Securities LLC 2,241.2 5 7.5 9 Morgan Stanley 2,216.5 6 7.4 4 Credit Suisse First Boston 2,038.2 7 6.8 7 ABN AMRO 1,833.2 8 6.1 7 Merrill Lynch & Co Inc 1,059.7 9 3.5 7 Lehman Brothers 550.0 10 1.8 3 Industry Total 29,968.3 - 100.0 62 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 Deutsche Bank AG 2,400.7 1 18.3 4 Morgan Stanley 2,041.7 2 15.6 3 Barclays Capital 1,492.5 3 11.4 2 Credit Suisse First Boston 1,243.6 4 9.5 2 ABN AMRO 1,243.6 4 9.5 2 Citigroup 944.1 6 7.2 2 Banc of America Securities LLC 750.0 7 5.7 1 Lehman Brothers 725.8 8 5.5 1 JP Morgan 725.8 8 5.5 1 HSBC Holdings PLC 566.7 10 4.3 1 Industry Total 13,114.5 - 100.0 11 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 45,141.4 1 11.1 83 Bear Stearns & Co Inc 36,779.6 2 9.1 79 Royal Bank of Scotland Group 34,159.6 3 8.4 57 Credit Suisse First Boston 33,805.4 4 8.3 70 Morgan Stanley 32,483.7 5 8.0 42 Countrywide Securities Corp 32,047.7 6 7.9 40 Deutsche Bank AG 29,521.0 7 7.3 56 Citigroup 22,504.9 8 5.5 46 Banc of America Securities LLC 20,787.4 9 5.1 45 Merrill Lynch & Co Inc 20,381.9 10 5.0 30 Industry Total 406,037.4 - 100.0 781 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 8,972.0 1 23.7 12 Banc of America Securities LLC 4,831.0 2 12.8 8 Morgan Stanley 3,883.6 3 10.3 4 Deutsche Bank AG 3,826.2 4 10.1 6 Credit Suisse First Boston 3,367.9 5 8.9 5 Merrill Lynch & Co Inc 2,965.8 6 7.8 3 UBS 2,527.7 7 6.7 5 Lehman Brothers 2,138.5 8 5.7 2 Goldman Sachs & Co 2,127.2 9 5.6 4 JP Morgan 1,808.5 10 4.8 4 Industry Total 37,869.3 - 100.0 32 Source: Thomson Financial

auto ABS 17% credit card ABS 8% global MBS 4% real estate ABS 58% student loan ABS 9% other 4%

Former Wachovia Securities CDO analyst Arturo Cifuentes, allegedly fired for not signing off on an important Sarbanes-Oxley Act disclosure document, presented his case to U.S. Department of Labor's Occupational Safety and Health Administration last week, offering e-mail evidence he contends proves his case. OSHA handles such complaints under SarbOx guidelines.

A deal backed by toll receivables on an eight-mile stretch of highway in Illinois, called the Chicago Skyway Bridge, hit the U.S. ABS market last week. Though toll road-backed deals are somewhat rare in the U.S. market, the deal priced at aggressive levels resembling those of even shorter-dated home equity deals. Chicago-based Skyway Concession Co. issued the Rule 144A transaction, with Citigroup Global Markets and Goldman Sachs as joint leads.

The ABS primary market is back on track with another solid summer week of nearly $14 billion of new issues priced and circulating in the market.