Securitization

Recent events in Russia are putting its RMBS under tighter scrutiny.

Despite getting an increase in the liquidity support originally pledged toward saving Hypo Real Estate (HRE), Pfandbriefe tied to the bank continue to suffer from disruptive pricing, Dresdner Kleinwort analysts said. The increase was to >50 billion ($68.4 billion) from >35 billion.

Gordian Knot has put up a good fight, weathering blow after blow amid the financial crisis. Its SIV, however, has finally had to call it a day, thus becoming the last independent SIV to go into receivership.

Monolines said they are still hopeful that they can find a niche in Europe via the municipal bond market, said speakers at the monoline panel at Information Management Network's second annual European CLOs, Structured Credit Products, and Credit Derivatives Summit.

Given the way the securitization market has dissolved over the past 14 months, the industry needs to make a case for why securitization is needed, said a senior official of Britain's Financial Services Authority (FSA) at Information Management Network's second annual European CLOs, Structured Credit Products, and Credit Derivatives Summit held in London last week.

Speakers on the opening panel at Information Management Network's second annual European CLOs, Structured Credit Products, and Credit Derivatives Summit said that the medium- to long-term outlook for the securitization market is positive, although it will be a bumpy ride along the way.

The more interesting story about September prepayments came in GNMAs, where speeds increased more than expected: 8% versus 1%. 2007 vintages were sharply higher in 5.5s, 6s and 6.5s; these surged a respective 80%, 63% and 28% from August's average.

Last week brought another round of actions from global central banks and governments, including the U.S., as the financial crisis continued to spread despite government actions already taken, including the recently passed $700 billion bailout bill.

The Federal Reserve Board's creation of the Commercial Paper Funding Facility (CPFF), announced last Tuesday, was welcomed by ABCP market participants.

Amidst uncertainty in the broader market, rising unemployment rates and weakening consumer credit positions, AmeriCredit boldly priced a $500 million offering of automobile receivables-backed securities last Monday, via AmeriCredit Automobile Receivables Trust.

CIBC recently considerably reduced its remaining exposure to U.S. residential mortgages through a fund arranged by Cerberus Capital Management. Cerberus agreed to invest $1.05 billion in cash in CIBC's U.S. residential real estate portfolio.

As deteriorating economic conditions continue to pound the structured finance markets, financial institutions across the board are looking to either shed assets from their deflated portfolios or take advantage of undervalued securities.

Europe has for months stood unified in its public position that it will be able to withstand the developing financial maelstrom because its banks are healthier than U.S. banks. Over the past few days, however, that position has changed.

When compared to the steep decline in issuance of other forms of ABS this year, and the broad sweep of the credit crisis, market conditions for debt backed by card receivables have held up quite well.

The U.K. Treasury announced today that a new expert liaison group on banking will be set up.

The regulator of Fannie Mae and Freddie Mac Thursday morning suspended capital classifications for the two GSEs, which have been operating under government control since early September.

The Treasury Department started purchasing agency MBS in September and Fannie Mae and Freddie Mac will be increasing their MBS purchases to support the housing market, according to Treasury secretary Henry Paulson.

The nationalization of Icelandic banks, Landsbanki and Glitnir, and the subsequent delivery of their balance sheets could affect certain U.K. CMBS transactions, according to a Barclays Capital research note published today, .

Despite getting an increase in the liquidity support originally pledged toward saving Hypo Real Estate (HRE), Pfandbriefe tied to the bank continue to suffer from disruptive pricing, Dresdner Kleinwort analysts said. The increase was to €50 billion ($68.4 billion) from €35 billion.

Mortgage Strategist, which is a weekly publication from UBS' investment research division, will halt publication, according to sources familiar with the situation.