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.

  • US CLO firm leadership shake-up

    Sector developments and company hires

    CLO firm makes md appointment MidOcean Partners has hired Natalya Michaels as md, focusing on mark...

    Market moves    25 September 2019
  • Ceo appointed

    Sector developments and company hires

    Ceo appointed CAC Specialty has appointed Michael Rice as ceo, bringing more than 25 years of expe...

    Market moves    24 September 2019
  • Master trust margins amended

    Sector developments and company hires

    Holmes Master Trust margins amended Moody’s comments that the proposed amendments to the...

    Market moves    23 September 2019
  • SCI Start the Week - 23 September

    A review of securitisation activity over the past seven days

    Transaction of the week Deutsche Bank is marketing a £114m UK CMBS, dubbed Deco 2019-RAM....

    News    23 September 2019
  • Law firm nabs SF vet

    Sector developments and company hires

    Law firm beefs up Orrick has hired structured finance lawyer Richard Hanson as a partner based in...

    Market moves    20 September 2019
  • Investor reassurance

    Spanish Supreme Court ruling assuages NPL ABS investor concerns

    Spain’s Supreme Court has ruled that Spanish banks are obliged to wait until at least 12 m...

    News Analysis    20 September 2019
  • Credit-granting guidance outlined

    "Bright-line" verification test still absent

    The EBA recently published an answer to a question posed by AFME in relation to Article 9(3) of the...

    News    19 September 2019
  • CMBS NOI slowing

    Sector developments and company hires

    Aircraft ratings review Moody’s has published a new overview which examines ABS issued i...

    Market moves    19 September 2019
  • Broader base

    New investors come to STS, but for what reason?

    A growing number of new investors, including bank treasuries, are participating in European...

    News    18 September 2019
  • Drilling down

    Opportunities on offer in consumer, despite downturn concerns

    Consumer finance in the US is still a relatively untapped asset class among institutional investors,...

    News Analysis    17 September 2019
  • CLO downgrade announced

    Sector developments and company hires

    CDS hire announced Axiom Alternative Investments has appointed Bedis Gharbi as senior portfolio ma...

    Market moves    16 September 2019
  • SCI Start the week - 16 September

    A review of securitisation activity over the past seven days

    Transaction of the week Alior Leasing has launched a 12 month revolving cash securitisation of aut...

    News    16 September 2019
  • Targeting opportunities

    Servicers continue hunt for Greek NPL ABS

    Hipoges Iberia, the Iberian servicer, is targeting opportunities in the Greek non-performing loan ma...

    News Analysis    13 September 2019
  • ECB stimulus announced

    Sector developments and company hires

    ECB stimulus package outlined The ECB has announced that it is cutting the interest rate on the de...

    Market moves    13 September 2019
  • Green ABS recommendations outlined

    Securitisation could be key tool in climate change battle

    Green securitisation can play an important role in helping to close the yearly investment gap of alm...

    News    12 September 2019
  • Risk transfer round-up - 12 September

    CRT sector developments and deal news

    Intesa Sanpaolo is rumoured to be prepping for 4Q19 two capital relief trades that reference respect...

    News    12 September 2019
  • Risk profile

    Basel 4 impact to vary based on business model

    The EBA last month published its advice on the implementation of Basel 4 in the EU, with its impact...

    News Analysis    12 September 2019
  • Polish ABS inked

    Securitisation features auto lease collateral

    Alior Leasing has launched a 12 month revolving cash securitisation of auto leasing loans and leases...

    News    11 September 2019
  • CLO firm incorporates ESG approach

    Company hires and sector developments

    Cayman CLO first Maples Group has supported the first ever US CLO to issue out of the Cayman Islan...

    Market moves    11 September 2019
  • Country md announced

    Company hires and sector developments

    Country md announced Jervis Smith has been appointed country md of Vistra Luxembourg, responsible...

    Market moves    10 September 2019
  • Maltese benefits

    Jurisdiction especially suited to innovative transport ABS

    Malta provides a legal and tax framework that provides the same benefits for the establishment of SP...

    News Analysis    10 September 2019