CLOs

EU CLO equity delivers higher IRRs than US counterparts

Analysis of BWIC trading and liquidated 2.0 deals highlights stronger returns for European CLO equity, with median IRRs of 12.1% versus 8.3% in the US, Poh-Heng Tan from CLO Research finds

EU CLO equity has outperformed US CLO equity, based on BWIC colour from a sample of approximately 446 equity tranches traded since July 2024 (source: SCI). This trend is also consistent with findings from 2.0 CLO deals that have been fully liquidated to date, according to CLO Research.

As shown in the table below, assuming a primary issue price of 95, EU CLO equity tranches have delivered stronger IRR outcomes for primary equity investors. The median primary equity IRR for EU CLOs was 12.1%, compared with 8.3% for US CLOs.

It is worth noting that a quarter of US CLO equity tranches returned just 2.9% IRR or less, whereas the bottom quartile of EU CLO equity tranches delivered 9.1% or less. The underperformance of US CLO equity is particularly evident when comparing the weakest-performing quartile across both markets.

That said, the top 10% of deals in both markets performed strongly, each generating IRRs of around 17–18% or more.

The table below presents the average primary equity IRR across the top 15 managers.

Source: Intex, CLO Research, SCI

RMBS

Second social RMBS prints amid ESG market revival

LiveMore targets older borrowers underserved by traditional mortgage market

LiveMore Capital has completed its second ESG securitisation, Exmoor Funding 2025-1, marking a milestone for the non-bank lender as it advances its social bond strategy in the RMBS market. The £221.5m deal, which priced earlier this month, is structured under LiveMore’s Social Bond Framework and aligns with the International Capital Market Association’s (ICMA) global principles for social bonds, having received a Second Party Opinion from ISS ESG.

LiveMore's social bond framework targets a specific demographic often overlooked by traditional lenders: borrowers over 50, who face age-related lending restrictions, particularly those who are transitioning into retirement.  Alexandra Hansmeyer, general counsel and head of ESG at LiveMore Capital, notes that the bond's social component was developed from identifying a market gap.

Through her analysis, Hansmeyer outlines that borrowers over 50 were being underserved by traditional mortgage markets – a relevant demographic as the UK's population ages and traditional lending criteria struggle to accommodate changing retirement patterns. The company believes it is the only lender in the UK securitising retirement interest-only (RIO) mortgages.

As data from SCI shows, in 2024, social labelled bonds made up the smallest slice in ESG securitisations, representing only 28.6% of the share, with RMBS deals accounting for 40% of the category.

ESG securitisation showing signs of a revival

The European ESG securitisation market has faced headwinds in recent years, with issuance volumes remaining weak given market conditions. However, the market is showing signs of revival after two difficult years of macroeconomic pressure, high inflation, rising interest rates and elevated spreads, reaching €5.5bn in 2024, up 177% from 2023, as reported by SCI in April.

According to LiveMore executives, increasing investor interest in ESG factors has been noted between the issuance of its two deals, as the market shows signs of recovery. "What we really noticed in the second deal was that, not only more investors appeared with ESG questionnaires, but also the depth and breadth of those questionnaires were significantly expanded as well,” they observe.

Simon Webb, md of finance and capital markets at LiveMore, notes that what shields the Exmoor programme from potential declines in ESG-related investor demand is that the company focuses on maintaining additional attractive elements, such as overall performance, that will support the fundamentals of the deal itself. As a result, the ESG element appears to be generating broader investor interest, rather than having a direct impact on pricing.

"We don't necessarily think at the moment it has an impact on pricing. What we find driving the pricing is more the STS label and CRR and LCR, as well as the strong performance of the assets more so necessarily than ESG specifically," he notes.

Hansmeyer backs this view, adding that the ESG element works as an extra draw when undertaking conversations with potential investors. "In Europe, there's still a strong ESG interest and development," she observes, citing recent capital markets sustainability conferences where ESG remains "on the agenda."

The company's debut deal, Exmoor 2024-1, printed in June 2024 and securitised a portfolio of around £208m of non-equity release loans. According to Webb, the issuance has been performing in line with expectations over the past year. As of 31 May 2025, arrears in the Exmoor 2024-1 portfolio were 0.8%, with no losses incurred.

Looking ahead, LiveMore aims to develop its Exmoor programme further, with plans for larger deals and ideally two transactions annually.

Marina Torres

Capital Relief Trades

French SRT market attracts broader investor base

H2 to see greater issuance

French banks could be more active in SRT in H2 2025 as the market prepares to welcome a more diverse investor, pool despite regulatory uncertainty, Fabrice Faure-Dauphin, partner at A&O Shearman, tells SCI.

While synthetic securitisation deals are well-supported by French institutions, including insurers, expansion of the current investor base would meet rising demand for capital relief solutions and also mitigate concentration risk, he notes.

“France is one of the most active SRT jurisdictions in Europe. We have seen repeat issuers, including, for instance, BNPP, Société Générale and Crédit Agricole, to name a few. A wider investor base would support its long-term depth,” he explains.

There is also appetite for insurer-backed trades, particularly where the protection is unfunded as it offers simpler structuring and more direct investor engagement, he adds.

“One of the merits of these unfunded credit protection deals by insurers is that they are simpler. You face your investor directly, and you do not need to establish a more complex structure through a vehicle dedicated to the CLN and providing the protection, as we see for other types of investors,” Dauphin says.

However, he warns that new regulatory requirements may add deter newcomers.

“There is this sanction regime, which could create kind of a worrying situation with this sort of renewed focus on sanction, which goes beyond what was envisaged before,” he says.

“People will need to gather and dedicate resources in terms of personnel. Also, there is a new line of business that is going to be created. I am not entirely sure that a new entrant in the market, as protection buyer, would necessarily tap a new entrant as new protection seller.”

Robust 2025 pipeline

Banks are expected to maintain a greater issuance momentum in H2, with portfolios backed by SMEs, corporates and leasing exposures continuing to dominate. In addition, public SRT deals have become more common in France, adding an extra layer of transparency to an otherwise market which is generally bilateral.

“We now also have multiple French deals closing under the STS framework, including on-balance-sheet securitisations. That signals maturity – but also suggests that originators are carefully navigating the regulatory environment,” Dauphin comments.

Although regulatory adjustments under the CRR3 package and Solvency II updates are being closely monitored, he says they have not significantly dampened market appetite.

“Investors are getting more cautious and want clarity, but we are not seeing anyone walk away. The real risk lies in regulatory ambiguity, not in the product itself. There is interest and some new structures coming in. I would say the market will still be active, although there is a bit of a wait-and-see mindset from certain investors,” he says.

Servicing standards are important, especially to international investors.

“In these transactions, one aspect which cannot be ignored is the quality and the efficiency of the servicing as well. The recovery in terms of attractiveness of the investors is key …There is a material investment to be made from investors to get knowledge and a good understanding of that process.”

For now, the French market remains resilient, with appetite among both issuers and investors holding firm. “We are not seeing a slowdown,” Dauphin concludes.

Nadezhda Bratanova

Capital Relief Trades

Investor demand booms for SRT product

M&G navigates SRT market intricacies

M&G Investments is expecting a busy H2 in SRTs as although supply and demand remain partially out of sync there is now enough variety to allow investors to be picky. 

“The SRT market has grown steadily over the years, but it's now expanding exponentially, with clear acceleration in issuance,” says Vincent Charles-Gervais, senior portfolio manager at M&G Investments. 

Europe continues to carry the baton of SRT issuance, with new deals coming from jurisdictions as different as Sweden to Italy. Moreover, non-traditional borrowers are now responsible for an increasing share of the market.

"We're seeing more issuance coming out of Europe, particularly from new and smaller banks. It used to be mostly the larger, more sophisticated institutions, but now even second-tier banks are tapping the SRT market. You’re seeing a similar trend in the US as well, with regional banks likely to issue more, but the overall trend is more pronounced in Europe,” points out Charles-Gervais.  

However, this surge in supply is not always aligned with investor demand, as the latest IACPM Global SRT Bank Survey shows.  

According to M&G, while it's true that a supply-demand imbalance persists, deals are getting bigger. Notably, larger SRT deals are attracting strong interest from new investors with sizable assets under management, leading to tighter spreads in these transactions.  

By contrast, smaller SRT deals – whether due to thinner tranches or smaller bank books – tend to draw less demand, as Charles-Gervais observes. As these deals don’t allow larger investors to deploy substantial capital, they are less affected by the demand surge seen in other parts of the market.  

As a result, the supply-demand imbalance is less pronounced for smaller transactions, where both issuance and investor appetite are more limited. 

"There have been a few very large entrants into the SRT market who are targeting these deals for their size – almost as an AUM play. That’s probably where we’ve seen the most spread tightening," says Charles-Gervais.  

Indeed, tightening and sometimes widening spreads have been a key topic in the SRT market so far this year. There was a 50-70bp widening in the wake of Liberation Day, although this is no longer the case. Spreads have begun to tighten again, and investors do not expect further tightening. 

"Spreads have tightened, but SRT still offers attractive relative value compared to other asset classes, which is why we remain active in the space,” Charles-Gervais adds. “Compared to other structured credit assets, such as CLOs or public ABS, and even to high-yield bonds or leveraged loans, SRTs continues to offer a premium. While there’s some convergence happening, the market still rewards investors.” 

In line with this, June’s SRTx  signals that SRT reference asset pools are expected to "significantly outperform" asset classes such as US corporate debt, European IG and high yield debt, and US prime auto loans.  

Broader market participation, including more jurisdictions, more banks and a wider range of asset classes, are some of the features of the SRT space that M&G finds compelling. With that, new investment opportunities are emerging.  

"The volume of issuance will probably exceed last year, so yes – we expect to remain very busy," concludes Charles-Gervais. 

Dina Zelaya

Asset-Backed Finance

Aviation ABS platform nears live rollout as issuance rebounds

Maples and Aerlytix aim to modernise post-Covid infrastructure as US$5bn in deals signal sector recovery

Capital Relief Trades

Spanish bank hits the market

SRT market update

ABS

Securitisation risk factors targeted in Solvency 2 consultation

Senior STS tranches expected to benefit the most

The European Commission last week published for stakeholder feedback a draft delegated act reviewing the Solvency 2 Delegated Regulation, which – among other aspects – would modify the capital requirements for insurance companies holding securitisation positions as investors. In line with the securitisation package presented last month, the stated aim is to facilitate bank lending capacity, by allowing originating credit institutions to transfer risk outside the banking sector.

In particular, the proposals envisage introducing a new set of risk factors for senior tranches of non-STS securitisations and reducing the risk factors for non-senior tranches, in order to ensure a senior-to-non-senior capital requirement ratio that better aligns with banking rules. For STS securitisations, the proposals envisage aligning the prudential treatment of senior tranches with that of covered bonds, while the treatment of non-senior tranches would be adjusted by the same extent as for senior tranches.

To assess the proposed amendments, BofA Global Research analysts calculated the respective ratios under the proposed and current Solvency Capital Requirement (SCR) for securitisation positions (under the standard model) and then compared them to the respective ratios under the CRR. The results indicate that: the alignment of STS senior tranche SCRs with those of covered bonds is justifiable; by maintaining the same ratio non-senior/senior STS SCR as in the original text, the proposal reduces the SCR for non-STS tranches; and the introduction of SCR for non-senior non-STS tranches is logical, allowing more risk-sensitive SCRs for senior and non-senior non-STS securitisation tranches.

However, the analysts note that the relevant bank ratios exhibit material differences from the Commission’s proposals, with a lower triple-A anchor (at around 1-1.5 times, or roughly half) and the CRR ratio senior/non-senior rising as the rating declines. Consequently, they argue that if the stated intention is to better align insurance capital with bank capital, then the application of bank ratios to insurers' anchors should be considered.

“We believe that EU insurers' participation in the EU securitisation market should be comparable to that of US insurers’ participation in the US securitisation market, if the EU is to develop an adequate securitisation market in the Eurozone. US insurers are major investors in the IG tranches of US securitisations and relatively minor investors in the sub-IG tranches. In the US (as well as in all other jurisdictions apart from the EU, as far as we know), there is no differentiation in SCR capital between senior and non-senior tranches and while the increase in SCR along the credit curve is a given, it is nowhere as steep as in the EU,” the BofA Global Research analysts note.

They go on to simplistically calculate RAROC by dividing the current risk-adjusted spreads of different exposures by their respective one-year capital, under both the newly proposed and currently used SCRs. The exercise demonstrates that despite the significant reduction in capital requirements for securitisation, its attractiveness increases only for senior STS tranches and marginally for senior non-STS tranches, while remaining disproportionately low for the non-senior tranches of non-STS securitisations.

“On the face of it, we expect the capital amendments to create demand from EU insurers for senior-most tranches of securitisations and especially for STS senior-most tranches. The demand from smaller insurers for non-senior tranches is likely to remain suppressed by the capital requirements as now proposed, despite the reduction,” the analysts conclude.

Corinne Smith

Asset-Backed Finance

Ninety One leverages ABF to fill EU's SME lending gap

Private lender accelerates dealmaking with €12.2m German resi loan as EU banks retreat from mid-market non-sponsored opportunities

Ninety One is moving quickly to capitalise on Europe’s mid-market lending gap, deploying capital with speed, precision and a focus on asset-backed finance (ABF). The firm recently closed a €12.2m senior secured loan, providing capex for a residential project in Germany, in a month – a timeline that would have stretched to six months or more under a traditional lender.

“This was a relationship-driven deal with a trusted sponsor and a de-risked asset,” adds Lei Lei, co-head of European credit opportunities at Ninety One. “That kind of flexibility just doesn’t exist in the banking system right now.”

The transaction was a follow-on to an earlier financing for the same borrower, a successful German entrepreneur active in both renewables and real estate. That prior deal, an acquisition financing for a solar portfolio, established trust and laid the groundwork for what Lei calls a ‘strategic fit.’

“Every investment must be backed by an asset,” says Lei. “We always look for a second layer of downside protection, beyond just cashflows. In this case, it was a partially pre-sold residential building in a German city – de-risked, and in a creditor-friendly jurisdiction.”

Despite being slightly below Ninety One’s typical €15m-€50m sweet spot, the deal ticked every strategic box: strong sponsor, clean asset and a visible exit.

Ninety One’s recent deal activity reflects a broader shift across Europe’s credit landscape. As banks pull back, mid-market borrowers, especially non-sponsored ones, are facing a persistent funding gap.

“We estimate the SME funding shortfall in Europe is nearing €1trn,” notes Lei. “Post-Covid, European banks have continued to retrench from SME lending and are increasingly focused on their NPLs. This leaves a huge opening for lenders who can move fast and offer flexibility.”

Although banks may still offer cheaper capital on paper, borrowers are increasingly prioritising execution certainty over cost. “It’s not just about interest rates – it’s about equity returns, customer satisfaction and avoiding delays that could derail entire projects,” says Lei. “Speed and flexibility still win in a tight market.”

One misconception Ninety One actively challenges is that non-sponsored deals are inherently riskier. “These are often highly capable entrepreneurs with significant skin in the game. We apply the same underwriting standards, but often the alignment is even stronger than with financial sponsors,” stresses Lei.

Non-sponsored borrowers also move faster, and that’s where private credit can truly shine. “They don’t have six months to assemble a financing package. That’s why our ability to offer tailored, swift solutions is such a differentiator.”

While the German residential loan was a high-conviction opportunity, Lei stresses that Ninety One’s pipeline stretches far beyond housing. “We’re actively investing in infrastructure, renewables and specialty finance,” he says. “Any sector where there’s an asset and a compelling credit story, we’re interested.”

Projects tied to the energy transition are high on the firm’s radar – from solar and battery storage to EV charging infrastructure. “Battery storage is a natural second derivative of the solar build-out,” adds Lei. “The ecosystem is maturing, and we’re ready to finance it.”

Ninety One maintains a clear focus on Northern and Western Europe, jurisdictions where creditor rights are robust and legal frameworks predictable. “Jurisdictional risk is real – that’s why we prioritise environments where we know we can enforce and recover, if needed,” says Lei.

With institutional demand for private credit surging and traditional banks continuing to retrench, Ninety One sees the opportunity set only expanding.

“The market is moving toward us,” says Lei. “It’s a perfect storm of borrower need and investor appetite. But to capture it, you need experience, trust and a repeatable process. That’s what we’re building at Ninety One. Anyone can promise capital. Not everyone can deliver quickly, structure intelligently and protect the downside. That’s where we win.”

Marta Canini

Capital Relief Trades

PRA update ushers in unfunded protection

Amended supervisory expectations clarify SRT oversight and notification

The PRA has updated its Supervisory Statement 9/13 - Securitisation: Significant Risk Transfer to include new supervisory expectations that are not dependent on the implementation of the Basel 3.1 standards, which have been delayed by 12 months to 1 January 2027. Notably, the amended SS – which is effective from 1 January 2026 – introduces Chapter 4A on the use of unfunded credit protection for synthetic SRT securitisations, clarifies senior management function (SMF) oversight of SRTs and expands the information to be provided with SRT notification. The move follows the publication of PS12/25 - Restatement of CRR and Solvency 2 requirements in PRA Rulebook - 2026 implementation, which outlines the Authority’s final policy in respect of consultation paper 8/24 and parts of Chapter 3 and 7 of CP13/24.

Under the amended SS9/13, originators will be able to use either funded credit protection or unfunded credit protection to achieve SRT, which is expected to lower the cost of protection in certain cases. Nevertheless, the PRA notes that the use of unfunded credit protection can pose additional prudential risks relative to funded credit protection, including: a potentially higher risk of late payment or non-payment of the credit protection amount when a borrower or counterparty defaults; and a risk that the unfunded credit protection provider may be downgraded and then cease to be eligible to provide unfunded credit protection, necessitating alternative arrangements to continue to achieve SRT.

The Authority says it therefore considers the use of unfunded credit protection for SRT to be a ‘complex feature’ and, as such, expects firms to discuss such transactions with their supervisor at an early stage. Additionally, as part of the monitoring and stress-testing of such transactions, it expects originators to assess the risk of a downgrade of the protection provider and the implications for the effectiveness of the unfunded credit protection and to reflect this in their capital planning.

Meanwhile, the SMF clarification provides for senior managers - while retaining accountability for the oversight and approval of SRT transactions - to rely on expert input and/or delegate the act of signing and submitting notifications. Consequently, it is anticipated that advisors will be able to communicate more directly with the regulator on SRT approvals. 

Finally, the information provided in SRT notifications can include a comparison with relevant previous transactions, highlighting changes that may be relevant to the PRA’s assessment and commenting on their rationale. As a result, SRT originating firms will be able to use previous transactions (not necessarily theirs) as an anchor for their current transaction, facilitating the conversation and leveraging on lessons learnt.

Corinne Smith

Capital Relief Trades

SRT volumes up by nearly a third

IACPM survey underlines EU issuer dominance

SRT volumes increased by nearly a third in 2024, protecting €21.4bn of credit risk on €260bn of loans, according to the latest IACPM Global SRT Bank Survey. The survey shows that 51 financial institutions executed 127 SRT transactions last year, up from 96 and volumes of €18.7bn in 2023. A portion of the SRTs reference mortgage and retail loan portfolios, but the bulk of the transactions comprise junior tranches of corporate and SME loan pools.

The EU continued to dominate the SRT market in 2024, accounting for more than half of all SRTs issued globally. Cumulatively, dating from 2016 to the end of 2024, more than €370bn worth of underlying EU bank loans were covered by €32bn worth of first loss and mezzanine tranche protection.

North American SRT activity remained relatively stable last year, protecting nearly €17bn worth of junior tranches. A significant development brought to the market by these banks, and different from other jurisdictions, is their use of SRTs to release capital on underlying pools of residential mortgage and retail loans.

Meanwhile, the share of sustainability-linked trades - through underlying assets, use of proceeds and incentives in the deal structure - is also gradually increasing, mainly in Europe. Volumes in this segment reached 18% in 2024, up from 10% in 2023.

The IACPM survey indicates that SRT issuers, particularly in Europe, are turning more frequently to the specialised credit arms of non-life multiline insurance companies to provide protection on the growing diversity of underlying asset classes. In 2024, the number of unfunded insurance protections sold increased substantially, with 82 new subscriptions (versus 45 in 2023) on 54 bank securitisations (versus 30 in 2023).

The association notes that demand for SRT investment exceeded supply in 2024, which led to an observed decrease in credit spreads. It points out that overall growth in the market is limited by supply, since SRT transactions are complex and can be costly.

“More than ever, the robustness and resilience of the SRT market will depend on the existence of effective securitization standards for due diligence and disclosure and the professionalism and stability of the large pool of protection providers, acting as long-term partners of banks,” comments Som-lok Leung, executive director of the IACPM.

Corinne Smith

Capital Relief Trades

Italian SRT surge on course despite regulatory uncertainty

Investor base for Italian product widens

Italy is seeing a renewed wave of synthetic securitisation activity, with local and international investors increasingly willing to take risk on more granular portfolios – even in more junior parts of the capital structure, say lawyers familiar with the market.

“Historically, Italian SRTs attracted a very limited investor base, but that is changing. The level of sophistication among both banks and investors has improved, and we are now seeing real appetite from a diversified base of asset management companies and insurers,” Pietro Bellone, partner at A&O Shearman, tells SCI.

Banks are expected to continue issuing predominantly in the second half of the year, with transactions coming from both Tier One and smaller regional lenders.

A major Italian bank is currently working on an SRT deal expected to close in the near future, while a handful of regional institutions are also in the pipeline with smaller but innovative SRT structures.

“We are not just seeing repeat deals from the same banks; new issuers are also coming to market. This demonstrates that the Italian SRT framework is gaining traction beyond the large national players,” Bellone explains.

He then notes that investors scrutinise increasingly how tranches are structured and how capital treatment is calculated. It is not only a question of size, but also of risk-weight treatment when considering capital treatment and tranching, he says.

While there is still regulatory uncertainty around EBA guidelines and the STS regime Bellone sees it as manageable. “We have gone through similar phases of uncertainty before. The base principles remain intact, and deals are continuing to happen,” he says.

However, he warns that the current 18-month transition period under CRR3 could pose a challenge in a fast-growing market.

“Even six or 12 months of uncertainty could become problematic for issuance. If we do not have technical details on how a test is to be run, that becomes difficult. I would hope that the regulator provides guidance in the context of the SRT processes, absent of clear rules,” he comments.

Many banks are therefore planning to finalise transactions under the current framework before changes come into force.

“They are happy to close the process as quickly as September, based on the existing framework,” Bellone says. “And they are curious to see what the developments will be. So far, so good – everything is under the existing regime, and the question mark will be how we adopt the new one. That will be a matter for next year, especially for transactions in the second part of next year.”

Issuers are also adding clauses that allow transactions to be unwound if needed. “Uncertainty might lead to contractual provisions protecting issuers, while investors still seek stability,” says Bellone.

Despite this, the SRT pipeline remains solid across both cash and synthetic formats, he notes.

“One of these is Hyundai Capital Bank Europe, which has publicly announced its first cash SRT securitisation in Italy. We have a pipeline of other deals with debut issuers that will close in the second part of the year,” he says.

While some transactions may face short-term delays, Bellone remains confident there will be further issuance. With capital needs too pressing to ignore, he is convinced that progress will depend on open dialogue and a pragmatic approach.

Nadezhda Bratanova

ABS

The irresistible lure of private markets

KBRA report notes rise and rise of structured finance private market

About 20% per year of all KBRA-rated structured finance deals since 2020 have been placed in the private market, according to a new report by the agency, and providing increasing evidence of the seemingly remorseless advance of private credit at the expense of primary markets.

The numbers for what KBRA defines as structured credit, which is a subset of structured finance, and ABS are even more eye-catching. Private placements now account for 65% of all structured credit deals and 30% of ABS.

The big leap forward occurred in 2022, when the proportion of privately-rated structured finance deals jumped from 14% in 2021 to 24%. Since then, the number has been 21% for 2023 and 19% for 2024. Back in the 2010s, it was around 8% to 10%.

Private market capital began taking market share from the traditional bulge bracket firms after the Dodd-Frank reforms of 2010, as regulators had hoped, but the pandemic crisis and associated market volatility gave it a big boost.

“The market was positioned to grow in the wake of post-financial crisis regulation. But it really came into its own during the pandemic, partly due to market instability.  Rising rates were also a catalyst,” Sean Malone, co-head of global structured credit at KBRA, told SCI.

Private markets offer comparative ease and certainty of execution, which is important for issuers during times of turbulence in primary markets. Investors, on the other hand, can have private market deals individually tailored to suit their own requirements and exposures.

Nor is it always the case that greater size can be issued in the public market.

"You can have as big a deal in the private market as the public market. All you need is an investor or small group of investors who want to take that up,” says Brian Ford, md.

What the primary sector does usually offer is cheaper pricing. There is a considerably larger pool of potential buyers, greater transparency and price discovery. These factors generally mean more cost-effective execution, and also much better post-sale liquidity.

For perhaps this reason, private markets have been unable to make as striking an inroad into the RMBS and CMBS sectors. Privately rated transactions constitute less than 0.5% of KBRA CMBS deals and less than 2% pf RMBS deals.

It is also true that greater size can be issued in the primary sector more regularly than the private sphere. “RMBS and CMBS have not gone down the private route. They need larger deal size and it would be difficult for one investor to take down an entire CMBS transaction,” says Ford.

The most regularly seen issuers in the structured credit private market are the the bigger CLO platforms, such as familiar names like Golub, Ares and Blackstone. Insurance providers, often annuity sellers, constitute a large portion of the investor base.

Traditional banking names like Barclays, Natixis, Wells Fargo and the broadly syndicated loan (BSL) arrangers can do private deals as well, but increasingly the bigger issuers structure deals inhouse. Malone notes that some bankers with the right skills have taken on structuring roles in the private market.

Increasingly, structured finance issuers consider the virtues of both private and primary markets before committing to one avenue, when hitherto only the latter was available. “Market conditions dictate which is better. The push-pull between the two areas goes back and forth. Both issuers and investors have the plumbing to intake both,” says Ford.

Simon Boughey

Structured Finance

Job swaps weekly: CalPERS lures industry veteran from PGGM

People moves and key promotions in securitisation

This week’s roundup of securitisation job swaps sees the California Public Employees’ Retirement System (CalPERS) appointing a PGGM stalwart as managing investment director for its private debt portfolio. Elsewhere, IQ-EQ has made a major acquisition in the APAC region as part of its global expansion strategy, which will bring a 77-person team under its umbrella, while Janus Henderson has assigned fund management responsibilities for its new investment-grade ABS ETF to two portfolio managers. 

CalPERS has appointed Mascha Canio as managing investment director for its private debt portfolio, effective from October. With decades of experience managing a variety of asset types on behalf of pension systems, Canio joins CalPERS after nine years as head of credit and insurance-linked investments at PGGM, where she has managed assets valued at approximately US$17bn. Before PGGM, she served as head of Europe at Octagon Credit Investors, setting up the firm’s European office to enable it to expand into Europe.

CalPERS’ private debt programme has been under the interim direction of Anton Orlich, head of private equity, for the past year.

Meanwhile, IQ-EQ has acquired Gordian Capital, Asia’s largest institutional cross-border fund platform and fund solutions provider. Its client base consists of global and regional asset managers, internal and external investment teams, SWFs, DFIs, family offices and corporates, investing in private equity, real estate, venture capital, private credit, infrastructure, hedge fund, absolute return and long-only strategies.

Established in Cayman in 2004 and in Singapore in 2005, Gordian’s 77-member team operates from offices in Singapore, Tokyo, Hong Kong, Shanghai and Melbourne and currently manages US$17bn. Subject to approval by the Dubai Financial Services Authority, it plans further expansion into the Middle East.

Having launched 115 funds over the last 20 years, this acquisition adds further strength and depth to IQ-EQ’s global business, providing clients with a range of additional products and services delivered by an experienced global team.

Gordian ceo and co-founder Mark Voumard will continue to lead the business and will join IQ-EQ’s Asia senior leadership team, ensuring continuity of the day-to-day delivery of services. He has been appointed md, head of fund platforms and solutions, Asia and Middle East at IQ-EQ.

The business will go to market as Gordian Capital, part of IQ-EQ until 2Q26, when the business will rebrand as IQ-EQ.

Janus Henderson portfolio managers John Kerschner and Nick Childs have been assigned fund management responsibilities for the firm’s new investment-grade ABS ETF, the Janus Henderson Asset-Backed Securities ETF (JABS). The portfolio will invest in short-duration, high-quality securitised assets that the investment team believes can generate attractive income with low volatility. This product is designed to serve as a fixed rate complement to Janus Henderson’s CLO ETF, JAAA, which provides access to high-quality floating-rate CLOs.

Childs is head of structured and quantitative fixed income at the firm, while Kerschner is global head of securitised products. The pair additionally manage Janus Henderson’s other active securitised ETFs, comprising JBBB(which provides exposure to floating-rate CLOs generally rated triple-B), JMBS (the largest actively managed MBS ETF) and JSI (which invests in opportunities across the US securitised markets.

Howden has named Giuliano Giovannetti and Richard Sullivan respectively head of credit, financial institutions, Europe and head of securitisation, financial institutions, Europe. The move follows the firm’s acquisition of Granular Investments, which the pair founded in October 2008.

Hayfin Capital Management has entered into strategic partnerships with Mubadala Investment Company and AXA IM Prime, on behalf of one of its investment funds. As part of the agreement, each firm will acquire a minority interest from Arctos Partners in Hayfin and leverage their capabilities and expertise to support Hayfin's investment strategies.

The transaction builds on the partnership between Hayfin and Arctos, which facilitated an MBO whereby the Hayfin team became majority owners of the firm’s common equity. To enhance the MBO, Hayfin and Arctos jointly sought to distribute a portion of the firm’s institutional ownership to additional strategic minority shareholders. Mubadala and AXA IM Prime, alongside Arctos, will now support the continued growth of Hayfin to further deliver on the firm’s long-term objectives of greater team ownership, alignment and incentivisation.

Paul Hastings has appointed Megan Roberts as a partner in its asset-backed finance practice, further strengthening its global ABF and structured credit platform. Based in Chicago, Roberts joins after more than 18 years at Sidley Austin, bringing deep experience advising issuers, underwriters, and investors on private securitisations, forward flow agreements, and acquisitions of consumer asset portfolios. Her broad asset class expertise spans student loans, fintech and unsecured consumer loans, auto and equipment finance, trade receivables, and data centres. 

Roberts has worked with a wide range of major financial institutions and asset managers, including long-standing Paul Hastings clients such as Barclays, Blackstone, Carlyle, and KKR. Her appointment builds on a series of recent hires in New York and London, highlighting Paul Hastings’ commitment to scaling its ABF capabilities globally.

Squire Patton Boggs has recruited Ranajoy Basu as partner in its London financial services practice group, where he will serve as global head of structured finance and head of the firm’s India practice. He joins from McDermott Will & Emery, where he was head of structured finance and chair of the India practice. Basu’s practice focuses on all types of structured finance arrangements, as well as impact investment financings.

Pantheon has appointed Florence Dard as partner and chief client officer, effective October 7, to boost its ongoing global expansion and strengthen its leadership in secondary markets. Based in London, she will lead the firm’s capital formation and client engagement efforts across institutional investors, private wealth, and insurance sectors, and will join Pantheon’s executive committee. 

Dard joins after spending more than 10 years at AXA Investment Managers, where she most recently served as global head of client group for the alternatives division, managing fundraising for real estate, infrastructure, private equity and credit, and leading a team of 80 people serving over 600 clients worldwide. 

And finally, Mayer Brown has appointed Philip Butler and David Miles to the firm as partners in its global leveraged finance and private capital practice. Both join from Dechert where they co-headed the global leveraged finance practice.

Butler, who was also co-head of London corporate & securities at Dechert, has more than three decades of experience structuring and negotiating a broad range of finance transactions, advising domestic and international clients on the implementation of complex debt structures.

Miles represents lenders, borrowers, sponsors and corporates on a full range of domestic and cross-border corporate lending and leveraged finance transactions. He has over 25 years' experience assisting leading UK and international clients in connection with large-scale private-equity-backed buyouts, corporate M&A, refinancings and recapitalisations. He regularly advises lenders on all capital structure layers, including senior, second lien, unitranche, mezzanine and PIK.

Corinne Smith, Marta Canini, Ramla Soni