Securitization

Where to put a proposed new consumer protection division appears to have become a game of musical chairs.

The GSE regulator has extended the Home Affordable Refinance Program (HARP) for one year so that Fannie Mae and Freddie Mac can continue to refinance high LTV and underwater mortgages.

AmeriCredit Corp. has expanded and exteded its warehouse credit facility. The borrowing capacity available under the facility increased to $1.3 billion from $1 billion.

Fannie Mae provided added details on what the GSE plans to do regarding the delinquencies on its MBS guarantee portfolio, and released details clarifying the timeline in which it will remove delinquent loans.

GE Capital served as sole lender for an $85 million ABS term loan to U-Haul. The loan will be used to refinance an existing securitization facility.

Delaware Investments has launched a fixed-income mutual fund that holds a variety of assets, including ABS and MBS, the Philadelphia-based firm said today. The fund is available to both individual and institutional investors.

The Association of German Banks called for new standards to restore confidence in securitization and help ease credit for Germany's small- and medium-sized businesses or SMEs.

Starting in September, Freddie Mac will no longer buy or securitize interest-only mortgages, as part of its continuing effort to rein in losses and tighten underwriting.

DebtX will be selling $105.5 million in primarily nonperforming loans for a regional bank in the western U.S.

Despite final rules published last month, banks running ABCP conduits are continuing discussions with regulators in an effort to temper new capital rules they say could shift assets to non-U.S. banks and potentially reduce what has been a successful short-term funding source for U.S. companies.

At the onset of the credit crisis, market participants expected a wave of consolidation in the CLO market. The wave turned out to be little more than a ripple, with less than 5% of the CLO market making management changes during the last year and a half, according to analysts at Citigroup Global Markets.

Reports last week surfaced that the Treasury Department is contemplating changes to the Home Affordable Modification Program (HAMP), which has been widely criticized for being ineffective.

Auto loan ABS might be coming down the Colombian pike this year for the first time, thanks to an appetite for alternative funding sources and a new law authorizing the establishment of non-mortgage securitizers.

With the boxes stacked up against the securitization market’s survival, industry players have to play a careful balancing act: How to make the case for the future but still survive in the current hostile environment?

GMAC Mexicana is on the road with the country's first pure auto loan ABS in the public market, according to sources. Tipping the scales at about Ps1.4 billion ($109 million), the A note will appeal to private banking clients for its short average life of 1.4 years, said a source close to the deal. "It makes a lot of sense to pitch it to private banking," he added. That will likely be one of the areas in which joint leads HSBC and Citigroup brokerage Acciones y Valores will be focusing their efforts during a roadshow that kicks off the week of March 1. HSBC structured the transaction as well.

Sovereign risk" are the words driving pricing in the European securitization market as the troubles in Greece unfold.

CLO managers don't want the exit doors closed on them.

The analysis of the changes in the GSEs' delinquent loan buyout policies focused on their impact on prepayment speeds and coupon swaps. An underlying notion was that the implementation of FAS 166 and 167 by Fannie Mae and Freddie Mac, which took place effective at the beginning of 2010, paved the way for the announcement; since the loans are now carried on their books at fair value, buyouts no longer have any affect on the GSEs' income statements.

On Feb. 10, Freddie Mac made an unexpected announcement that it would "purchase substantially all 120 days or more delinquent mortgage loans from the company's related fixed-rate and adjustable-rate (ARM) mortgage Participation Certificate (PC) securities."

With new accounting rules, regulatory uncertainty, and wary investors making ABS uneconomical for issuers, pockets of the securitization market are paralyzed. Participants are forced to look at alternative funding sources, which Nora Colomer explores in this month's cover story.