ABS

ABS or asset-backed securities are bonds or notes created via securitisation that are backed by a range of assets or receivables. Generically, all securitisations can be labelled ABS and it is often used as a coverall term; in some cases in SCI, ABS will be used in this manner. However, in many cases, ABS are taken to exclude mortgage-backed securities (MBS) and structured credit instruments, such as CDOs. If so, then asset-backed securities or ABS are taken to include consumer ABS, such as credit card securitisations, auto loan or dealer floorplan ABS, student loan securitisations, project finance/infrastructure securitisations and equipment leasing-based transactions. ABS originators are typically loan issuers, such as banks, credit card companies, auto finance and consumer finance firms, but can be any institution that generates regular, quantifiable future income flows (or cashflows), which includes governments. To create asset-backed securities, institutions sell pools of their loans to a special-purpose vehicle, or SPV, which then sells the loans to a trust. The trust then repackages the loans as interest-bearing securities and issues them. This true sale of the loans to the SPV ensures that the ABS is treated as being bankruptcy-remote from the originator.

• CMBS scores in first TALF window

  Sector developments and company hires

  CMBS scores in first TALF subscription Investors requested US$252m in loans under the first TALF 2....

  Market moves    18 June 2020

• SRT debut

  Sabadell completes first synthetic securitisation

  Sabadell has completed a €96m mezzanine guarantee with the EIF. The transaction references...

  News    18 June 2020

• Bridging gaps

  Linking SRT originating banks with insurance partners

  Texel is aiming to help insurers and banks bridge gaps in their understanding of how each sector app...

  Market moves    17 June 2020

• Risk transfer round-up - 17 June

  CRT sector developments and deal news

  Credit Suisse is rumoured to be readying a capital relief trade from the Elvetia programme that is s...

  News    17 June 2020

• Older CLOs underperforming

  Sector developments and company hires

  Older CLOs underperforming A significant proportion of all the US BSL CLOs S&P has on negat...

  Market moves    16 June 2020

• Take-up rates

  Significant variations across European moratoria

  Payment holidays have so far assisted in deterring defaults during the coronavirus crisis. However,...

  News    15 June 2020

• SCI Start the Week - 15 June

  A review of securitisation activity over the past seven days

  Last week's stories Addressing inconsistencies Performance metrics switched Calabria confiden...

  News    15 June 2020

• Californian auto loans eyed

  Sector developments and company hires

  Californian auto loans eyed The Westlake Automobile Receivables Trust 2020-2 issuer has disclosed t...

  Market moves    12 June 2020

• Strategic review

  Direct lending JV formed

  Newly established investment manager KKV Investment Management has finalised investment management a...

  News    12 June 2020

• Addressing inconsistencies

  Performance metrics switched

  Metrics that assess the level of portfolio interest and principal cashflows have become more reliabl...

  News    12 June 2020

• Risk transfer rebound

  Deutsche Bank completes SRT

  Deutsche Bank has completed a US$325m CLN that references a disclosed US$5bn global portfolio of lar...

  News Analysis    12 June 2020

• Euro ABS 'game changer' recommended

  Sector developments and company hires

  Euro ABS ‘game changer’ recommended The European High-Level Forum (HLF) on the...

  Market moves    11 June 2020

• LCR eligibility eyed

  Final credit mapping framework awaited

  Prime Collateralised Securities last week withdrew several liquidity coverage ratio assessments on d...

  News    10 June 2020

• Risk transfer round-up - 10 June

  CRT sector developments and deal news

  Santander has exercised a 10% clean-up call for its Red-1 Finance CLO 2017-1 transaction. The UK com...

  News    10 June 2020

• Resolve and resilience

  Content sponsored by Ocorian

  James Maitland, regional head of Americas, Bermuda & Caribbean, and global head of capita...

  Talking Point    10 June 2020

• NCSLT consent judgment denied

  Sector developments and company hires

  NCSLT consent judgment denied Fitch has affirmed 37 notes and maintained its rating watch negative...

  Market moves    9 June 2020

• Spread compression

  European ABS market update

  The rally in broader risk assets and the lack of new supply has boosted demand for paper in the Euro...

  News    9 June 2020

• Perfect storm

  Hertz bankruptcy to reshape auto ABS?

  Hertz’s recent bankruptcy is one casualty of a perfect storm caused by a drop in used vehi...

  News Analysis    9 June 2020

• CLO business integrated

  Sector developments and company hires

  CLO business integrated RBC’s US-based CLO management business is being integrated into B...

  Market moves    8 June 2020

• HAPS ABS debuts

  Eurobank finalises Cairo transaction

  Eurobank has finalised the first non-performing loan securitisation under the Hercules Asset Protect...

  News    8 June 2020

• SCI Start the Week - 8 June

  A review of securitisation activity over the past seven days

  FREE - Capital Relief Trades Virtual Panel - LIVE For a discussion on how the Covid-19 fallout has...

  News    8 June 2020