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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.


  • Risk transfer round up - 15 July

    CRT sector developments and deal news

    Credit Agricole is rumoured to be readying a corporate capital relief trade that is expected to clos...

    News    15 July 2020
  • October cliff edge looms

    The apparent recovery of many parts of the MBS market may be a false dawn

    Mortgage-backed securities have in general rebounded with confidence in recent weeks, but there is a...

    News Analysis    15 July 2020
  • Risk transfer return

    Intesa debuts post-Covid Italian SRT

    Intesa Sanpaolo has returned to the synthetic securitisation market with a new transaction from its...

    News Analysis    15 July 2020
  • Dual-speed transition?

    Libor replacement risks highlighted

    The Alternative Reference Rates Committee's timelines for transitioning from Libor to SOFR i...

    News Analysis    14 July 2020
  • LCX platform expanded

    Sector developments and company hires

    LCX platform expanded LendingClub has expanded its LCX platform to make it easier for registered...

    Market moves    13 July 2020
  • SCI Start the Week - 13 July

    A review of securitisation activity over the past seven days

    Last week's stories Arch restarts MILNs Relaunched Bellemeade Re 2020-1 priced Collection boo...

    News    13 July 2020
  • OC ratios examined

    Sector developments and company hires

    OC ratios examined Drivers behind and expectations for European CLO OC ratios have been examined in...

    Market moves    10 July 2020
  • Risk transfer round up - 10 July

    CRT sector developments and deal news

    Commerzbank is rumoured to be readying a corporate capital relief trade that is expected to close in...

    News    10 July 2020
  • Spanish CP vehicle formed

    Sector developments and company hires

    Spanish CP vehicle formed ODF Energía has registered on MARF the first issuance of comme...

    Market moves    9 July 2020
  • Restructuring events?

    Uncertainty over CRE values weighs on CRTs

    Restructuring credit events in capital relief trades backed by commercial real estate loans will lik...

    News Analysis    9 July 2020
  • Pricing recalibration

    NPL ABS market growth pending?

    The EBA’s opinion (SCI 24 October 2019) and more recently the Basel Committee’s...

    News Analysis    9 July 2020
  • Polish SRT inked

    Santander completes capital relief trade

    Santander has completed a synthetic securitisation of Polish leasing receivables with the EIF. The t...

    News    9 July 2020
  • CQS portfolio refinanced

    Sector developments and company hires

    CQS portfolio refinanced AnaCap Financial Partners has acquired and refinanced a portfolio of sal...

    Market moves    8 July 2020
  • Collection boost?

    NPL ABS performance remains volatile

    May registered higher collection volumes than April for Italian non-performing loan securitisations,...

    News    7 July 2020
  • Positive signs for CLOs

    Sector developments and company hires

    Positive signs for CLOs US CLO manager metrics have begun to improve or stabilise, according to JPM...

    Market moves    7 July 2020
  • Volcker revision impact modest

    Sector developments and company hires

    Volcker revision impact modest The impact of the changes made to the Volcker Rule (SCI 26 June) wil...

    Market moves    6 July 2020
  • Risk transfer round-up - 3 July

    CRT sector developments and deal news

    Details have emerged of three corporate capital relief trades issued by Barclays last month. The ris...

    News    3 July 2020
  • Support measures

    Guarantee programmes hinder SME ABS comparability

    European SME ABS comparability is being hindered by the diverging terms and conditions of guaranteed...

    News Analysis    3 July 2020
  • Spanish SRT inked

    BBVA launches capital relief trade

    BBVA has completed an €87m mezzanine guarantee with the EIF. Dubbed Vela Four, the transact...

    News Analysis    3 July 2020
  • Consistently attractive CMBS

    CMBS is still the TALF favourite, but overall take-up could increase

    Some 58% of loans requested under TALF 2.0 during the first subscription period, or $145m, were for...

    News    2 July 2020
  • Fast amortisation

    SSPAIN deleveraging highlighted

    Scope Ratings has published a monitoring report for Santander’s 2019 US auto significant r...

    News    2 July 2020