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.

• Invoice ABS debuts

  First trade receivables securitisation for India

  Northern Arc Capital and fintech platform CredAble have closed a trade finance securitisation backed...

  News    23 March 2020

• NPL supervisory flexibility introduced

  Sector developments and company hires

  Canadian purchase programme The Canadian government has launched a revised Insured Mortgage Purchas...

  Market moves    20 March 2020

• Economically efficient

  Study supports reduction of PD estimates

  A new study undertaken by Open Source Investor Services (OSIS) suggests that capital relief trades a...

  News Analysis    20 March 2020

• Credit event definitions

  UTP category brings less uniformity

  The EBA’s guidelines on default definitions have brought less uniformity to credit event d...

  News Analysis    20 March 2020

• Close relationship

  CRT documentation should evidence intentions

  When structuring a capital relief trade, the documentation should evidence the intentions of the par...

  News    20 March 2020

• Further central bank support unveiled

  Sector developments and company hires

  Bridging loan deal inked UK challenger lender Glenhawk has closed a private revolving securitisatio...

  Market moves    19 March 2020

• Short-term volatility

  SRTs on hold, although 2H20 rebound expected

  Capital relief trade issuance has been postponed until the second half of the year due to the corona...

  News Analysis    19 March 2020

• Risk off

  Securitisation markets seize up

  Amid a global sell-off, securitised asset classes where liquidity is scarce and asymmetry of positio...

  News    19 March 2020

• EIB mulls SME ABS purchase plan

  Sector developments and company hires

  Dealer credit facility launched The US Fed has established a Primary Dealer Credit Facility (PDCF)...

  Market moves    18 March 2020

• Pandemic response

  DNB lowers bank buffers amid outbreak

  Dutch central bank DNB has lowered the capital buffers for Dutch banks and postponed the introductio...

  News    18 March 2020

• Even playing field?

  Reg AB relaxation set to release RMBS

  The relaxation of FDIC rules regarding bank compliance with SEC Regulation AB when issuing RMBS (SCI...

  News Analysis    18 March 2020

• Fed rolls out CPFF

  Sector developments and company hires

  CMB purchase programme The Bank of Canada has announced that it stands ready, as a proactive measur...

  Market moves    17 March 2020

• Liquidity concerns

  European ABS pipeline coming to a halt

  The European ABS primary market is grinding to a halt amid coronavirus-related volatility, with many...

  News Analysis    17 March 2020

• Greencoat liquidator appointed

  Sector developments and company hires

  EMEA Ocorian has appointed Abigail Holladay as director of transaction management. Based in Londo...

  Market moves    16 March 2020

• SCI Start the Week - 16 March

  A review of securitisation activity over the past seven days

  SCI NPL Securitisation Awards 2020 As a result of COVID-19, the SCI NPL Securitisation semina...

  News    16 March 2020

• Native blockchain securitisation debuts

  Sector developments and company hires

  Ares facility inked Non-Standard Finance (NSF) has entered into a new six-year securitisation fac...

  Market moves    13 March 2020

• AMC uncertainty

  Trade deal clouded by uncertainties for NPLs

  The US-China trade deal now finally allows foreign investors to acquire coveted local AMC licences t...

  News    13 March 2020

• Multi-tranching?

  Investor diversification raises triple-tranche prospects

  Seer Capital sees a future for triple tranche structures in significant risk transfer transactions....

  News Analysis    13 March 2020

• Definition debate

  Call for coalescence around ESG standards

  Impact is still being defined in the capital markets, both at a conceptual level and in terms of gen...

  News Analysis    12 March 2020

• Regulatory events

  Standard Chartered amends Gongga SRT terms

  Standard Chartered has amended the regulatory event definitions for the class A notes of a corporate...

  News    12 March 2020

• Mortgage moratoriums

  Impact of payment suspensions to be limited

  The Italian government and a trio each (at the time of writing) of lenders in Ireland and the UK are...

  News    12 March 2020