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.


  • Libor replacement a "steep challenge"

    A transition to a replacement reference rate away from Libor by 2021 will be a "steep challenge" wit...

    News    24 October 2017
  • ABS rating effect explored

    Rating changes can have a significant impact on an ABS bond's price and value. While investors are l...

    News    24 October 2017
  • ESNs 'not needed yet'

    European Structured Notes (ESNs) have been on the radar for some time and a recent Moody's analysis...

    News Analysis    23 October 2017
  • SCI Start the Week - 23 October

    A look at the major activity in structured finance over the past seven days.

    Pipeline Additions to the pipeline last week were once again heavily skewed towards ABS. There were...

    News    23 October 2017
  • Job swaps round-up - 20 October

    Australia Baker McKenzie has recruited Duncan McGrath as a partner in its corporate group in Sydne...

    Job Swaps    20 October 2017
  • MPS loan appraisal pending

    Cerved Information Solutions, one of the largest Italian servicers, has been selected by Atlante II...

    News Analysis    20 October 2017
  • Risk transfer round-up - 20 October

    Rumours abound of new capital relief trades being prepped. One source suggests that ING is readying...

    News    20 October 2017
  • Swap downgrades 'justified, necessary'

    Fitch downgraded Deutsche Bank's ratings last month, stating that the bank is no longer a suitable c...

    News Analysis    20 October 2017
  • Montepio NPL deal marketing

    A €142.5m Portuguese non-performing loan securitisation has hit the market. Dubbed Hefesto...

    News    19 October 2017
  • Mortgage ILS landmark imminent

    United Guaranty is in the market with Bellemeade Re 2017-1 (see SCI's deal pipeline). The mortgage i...

    News    18 October 2017
  • CRT outlook bullish

    Optimism prevailed at SCI's recent Capital Relief Trades Seminar, where panellists were bullish on t...

    Talking Point    16 October 2017
  • SCI Start the Week - 16 October

    A look at the major activity in structured finance over the past seven days.

    Pipeline Additions to the pipeline last week were heavily skewed towards ABS. There were 20 ABS nam...

    News    16 October 2017
  • Risk transfer round-up - 13 October

    Risk transfer activity continues, with Lloyds reportedly readying a transaction for Q4. Sources also...

    News    13 October 2017
  • Job swaps round-up - 13 October

    Acquisition Navient has entered into an agreement to acquire online student lender Earnest for US$...

    Job Swaps    13 October 2017
  • NPL platform to boost recoveries

    The creation of a non-performing loan platform by Portugal's three largest banks - Caixa Geral de De...

    News Analysis    13 October 2017
  • BJETS concerns highlighted

    Business Jet Securities series 2017-1 exposes investors to multiple risks - including performance vo...

    News    11 October 2017
  • ILS issuance hits all-time highs

    The insurance-linked securities market has seen a surge in new issuance this year, with 1H17 witness...

    News Analysis    11 October 2017
  • Specialised financing vehicles introduced

    The latest reform of the French finance sector introduces a new category of financing vehicle that i...

    News    11 October 2017
  • Treasury report supports securitisation

    The US Treasury has released a report recommending a number of regulatory changes that could make it...

    News    9 October 2017
  • C-PACE lender breaks new ground

    Greenworks Lending has privately placed the first rated securitisation of purely commercial PACE ass...

    News Analysis    9 October 2017
  • SCI Start the Week - 9 October

    A look at the major activity in structured finance over the past seven days.

    Pipeline It was a quieter week for the pipeline, with activity noticeably down on the week before....

    News    9 October 2017