News
SRTx
Latest SRTx fixings released
Spreads and sentiment retrace
The latest SRTx fixings suggest that the current market environment and outlook for the SRT sector is characterised by a retracement and compression in spreads, with sentiment now described as “incredibly more favourable.”
This follows a brief period of sharp volatility where spreads had widened - including in the broader structured finance sectors - across the board. This was notably illustrated in last month’s data, whereby the SRTx benchmark had briefly surged to its highest credit risk figure since the March 2023 banking crisis.
However such recent tightening in SRT spreads and sentiment is consistent with the broader credit market. In fact, the latest Seer Capital research notes that underlying US High Yield (BBG US HY OAS) spreads tightened by 5bps during September, a trend driving capital back into risk assets. On this theme, some market sources suggest that the market is currently “priced to perfection.”
Such perception contends that US high yield is back to being priced for perfection, assuming a world where growth persists and where inflation and employment disruptions remain contained, despite looming geopolitical and fiscal concerns. This view is fundamentally significant for an asset class like SRT, which inherently represents highly leveraged, first-loss credit risk. The current spread compression is being dictated by positive fundamentals, including resilient bank balance sheets, and the anticipation of further Federal Reserve easing, rather than technical factors alone.
Finally, the wider market outlook for Q4 2025 is indeed defined by a risk-on pivot driven by the expectation of further Federal Reserve rate cuts. More specific to SRTs, the expected accelerating rates of risk transfer transactions continues to illustrate a powerful push–pull dynamic.This is a supply/demand imbalance where banks must "push" out risk to meet increasing capital requirements (like the anticipated/diluted Basel III Endgame in the US), while SRT investors need to employ their record levels of capital and dry powder—including growing demand from pension funds and large asset managers—seeking to "pull in" credit exposures.
The SRTx Spread Indexes now stand at 742 (-4.9%), 526 (-11.2%), 805 (-0.7%) and 967 (-11.5%) for the SRTx CORP EU, SRTx CORP US, SRTx SME EU and SRTx SME US categories respectively, as of the 30 September valuation date.
The SRTx Volatility Index values now stand at 46 (-23.5%), 56 (10.0%), 46 (-27.8%) and 67 (-11.1%) for the SRTx CORP VOL EU, SRTx CORP VOL US, SRTx SME VOL EU and SRTx SME VOL US indexes respectively.
The SRTx Liquidity Indexes stand at 46 (-13.3%), 44 (0.0%), 46 (-13.3%) and 58 (0.0%) across SRTx CORP LIQ EU, SRTx CORP LIQ US, SRTx SME LIQ EU and SRTx SME LIQ US respectively.
The SRTx Credit Risk Indexes now stand at 54 (-6.3%) for SRTx CORP RISK EU, 65 (0.0%) for SRTx CORP RISK US, 57 (-5.9%) for SRTx SME RISK EU and 56 (-30.8%) for SRTx SME RISK US.
SRTx coverage includes large corporate and SME reference pools across the EU and US economic regions. The index suite comprises a quantitative spread index - which is based on survey estimates for a representative transaction (the SRTx Benchmark Deal) that has specified terms for structure and portfolio composition - and three qualitative indexes, which measure market sentiment on pricing volatility, transaction liquidity and credit risk.
Specifically, the SRTx Volatility Indexes gauge market sentiment for the magnitude of fixed-spread pricing volatility over the near term. The index scale is 0-100, with levels above 50 indicating a higher proportion of respondents estimating volatility moving higher.
The SRTx Liquidity Indexes gauge market sentiment for SRT execution conditions in terms of successfully completing a deal in the near term. Again, the index scale is 0-100, with levels above 50 indicating a higher proportion of respondents estimating that liquidity is worsening.
Finally, the SRTx Credit Risk Indexes gauge market sentiment on the direction of fundamental SRT reference pool credit risk over the near term. The index scale is 0-100, with levels above 50 indicating a higher proportion of respondents estimating that credit risk is worsening.
The objective of the index suite is to depict changes in market sentiment, the magnitude of such change and the dispersion of market opinion around volatility, liquidity and credit risk.
The indexes are surveyed on a monthly basis and recalculated on the last trading day of the month. SCI is the index licensor and the calculation agent is Mark Fontanilla & Co.
For further information on SRTx or to register your interest as a contributor to the index, click here.
Vincent Nadeau
Talking Point
CLOs
European CRE CLOs set for growth as transitional real estate financing evolves
Stabilising rates and the rise of non-bank lenders are setting the stage for European CRE CLO boom
European commercial real estate markets are showing tentative signs of recovery as interest rates stabilise, prompting renewed appetite for structured financing.
According to a new ‘Demystifying Credit’ report from Morningstar DBRS, this environment is paving the way for commercial real estate (CRE) CLOs to evolve from a niche product into a viable alternative to traditional CMBS structures.
While European CMBS issuance remains dominated by single-asset or single-borrower deals, a growing cohort of non-bank lenders originating short-term transitional property loans could help foster the next stage of CRE CLO development, according to the credit rating agency.
These transactions allow originators to securitise transitional CRE loans while retaining active portfolio management - freeing up balance sheets and offering investors exposure to higher-yielding CRE debt.
“CRE CLOs are uniquely suited to capture the activity of transitional lending and bridge financing that traditional CMBS structures often struggle to accommodate,” Morningstar DBRS notes in the report. “They offer managers the flexibility to recycle capital and manage exposures dynamically - features that are becoming increasingly relevant in the current market cycle.”
Unlike static CMBS pools, CRE CLOs are dynamic, enabling managers to substitute or modify loans within eligibility limits. Morningstar DBRS adds that these transactions typically include ramp-up or reinvestment periods and strict overcollateralisation and interest coverage tests to prevent credit-quality deterioration.
The report highlights examples of European deals incorporating CRE CLO features, including Starz Mortgage Securities 2021-1 - a €219.8m static deal backed by nine loans across the UK, Ireland and the Netherlands - and Pembroke Property Finance 3, a 2025 multi-borrower CMBS with flexibility for loan substitutions and modifications.
Morningstar DBRS also references Dutch Property Finance 2022-CMBS1, which featured substitution rights and asset-level modification powers, signalling a gradual convergence between CMBS and CLO-style deal mechanics.
However, analysts caution that Europe’s CRE CLO market still remains in its infancy. “Unlike the US, where CRE CLOs have become a staple of real estate credit markets, Europe still faces structural headwinds - from complex legal frameworks to multi-currency risk and a less developed investor base,” the report states.
However, Morningstar DBRS believes the path ahead is clear. “The need for refinancing solutions, the rise of non-bank property lenders and investor demand for yield are combining to create the right conditions for CRE CLOs to take root in Europe,” the agency concludes.
As refinancing pressures mount across the real estate sector and loan maturities peak over the coming years, CRE CLOs could become a vital mechanism for recapitalising commercial property markets, bridging the gap between traditional bank lending and private credit.
Last month, Arini told SCI that it is ramping up its focus on UK CRE as valuations near a bottom and refinancing demand surges.
Ramla Soni
Market Moves
Structured Finance
Job swaps weekly: Orrick and Cadwalader ring the changes
People moves and key promotions in securitisation
This week’s roundup of securitisation job swaps sees Orrick hiring 37 CLO and asset-backed lending lawyers from Cadwalader, Wickersham & Taft, including 10 partners. Cadwalader, in turn, has elected a trio of securitisation lawyers to its partnership, while Nuveen has launched a dedicated global infrastructure investment platform.
Orrick has confirmed its move to strengthen its global structured finance practice, hiring a 37-lawyer CLO and asset-backed lending team from Cadwalader, Wickersham & Taft. The group includes 10 partners and marks one of the largest lateral finance moves of the year. The hiring spree was reported by SCI in September.
The hires span London (14 plus two trainees), Washington D.C. (six), Charlotte and New York (three), led by partners David Quirolo, Daniel Tobias, Claire Puddicombe and Alex Collins in London, alongside Joe Beach, Nate Spanheimer, Skyler Walker, Doug Arborio, Gregg Jubin and Mike Gonzalez in the US. The move also coincides with the launch of Orrick’s new Charlotte, North Carolina office, home to 15 lawyers, the firm announced today.
Orrick chair Mitch Zuklie described the move as a “game-changer” for the firm and its clients, positioning it to lead innovation across private credit and structured products. The hires follow continued strategic expansion in London and the US, reflecting the firm’s growing focus on private debt and securitisation markets.
Meanwhile, Cadwalader has elected a trio of securitisation lawyers to its partnership. Robert DiNardo is a partner in the firm’s New York financial services group, where he advises investment banks, fund managers and financial institutions on the structuring, negotiation and execution of complex derivatives and structured financing transactions. His practice spans a broad spectrum of trading, risk management, credit enhancement and capital relief structures, with a particular focus on innovative financing and hedging solutions that integrate securitisation techniques and derivative products.
Jinisha Patel is a partner in Cadwalader's London capital markets group. She represents investment banks, asset managers and investors in a range of structured finance transactions, focusing primarily on CLOs and asset-based lending facilities.
Finally, Hunter White is a partner in the firm’s capital markets group in Washington, DC. He primarily advises financial institutions and corporate borrowers in connection with financings across various asset classes and securitisation types, including consumer loan ABS, GSE-sponsored RMBS and student loan ABS.
Elsewhere, Nuveen has created a dedicated global infrastructure investment platform, bringing together multiple specialised teams under unified leadership to capitalise on the unprecedented investor demand for infrastructure assets. These teams include: Nuveen energy infrastructure credit (led by Don Dimitrievich), specialised Nuveen infrastructure equity (led by Biff Ourso, as head of infrastructure equity) and Nuveen Green Capital (retaining her title as cio, Alexandra Cooley will now also serve as ceo).
Jessica Bailey, who previously served as ceo of Nuveen Green Capital, has been appointed head of global infrastructure, a newly created role responsible for scaling the platform. Bailey will report to Saira Malik, Nuveen cio.
Reflecting the firm's core areas of conviction, Nuveen's investment capabilities will now be organised into six distinct asset class pillars. In addition to the new global infrastructure investment platform, the five other distinct asset class pillars comprise: a global real estate platform (led by Chad Phillips), a global natural capital platform (led by Martin Davies), a global private capital platform (led by Ken Kencel and Anthony Fobel as co-ceos), a global fixed income platform (led by Anders Persson) and a global equities platform (led by Willis Tsai).
Ramnik Ahuja has rejoined Citi as director – securitisation, based in London. He was previously senior advisor, real estate and structured finance at the Saudi Central Bank (SAMA), which he joined in April 2022 with the remit of facilitating the country’s securitisation and structured funding markets, as part of Saudi Arabia’s Vision 2030 Financial Sector Development Programme and Housing Sector Development Programme. Before that, Ahuja worked at MUFG, Deloitte, Bank of England, Bank of America and RBS in various structured finance-related roles, having begun his career as a trainee portfolio manager at Citi in January 1997.
David Johnston has joined the Blackstone Credit & Insurance team and its infrastructure & asset-based credit (IABC) unit as senior md and head of European residential and consumer credit. He will be based in London, reporting to Dan Leiter (head of international, BXCI) and Nick Menzies (who leads consumer and residential real estate credit investments for the IABC).
Johnston joins Blackstone from AB Carval, where he spent the last 12 years and was most recently co-head of the European loan portfolio team. At AB CarVal, he focused on consumer, residential and commercial whole loan portfolios, including portfolios across multiple European jurisdictions and specialty finance platforms.
London-based Robert Wakeford, Kevin Yates and Chris Hall have launched as founding partners Eden Rock Credit, with the support of investment advisory firm Eden Rock Group. Eden Rock Credit is a mid-market private credit manager focused on asset-backed and corporate lending, established to provide flexible financing that supports M&A, refinancing, recapitalisation and long-term value creation.
Wakeford and Yates were previously mds at BZ, an asset-based lender that they joined in May 2020 from Leumi ABL. Hall was previously an md at Interpath Advisory, which he joined in January 2023 from Tatsu Partners, having worked at Wyvern Partners and EY before that.
Nomura has expanded its securitised products & private credit franchise with the formation of a US commercial real estate platform. As part of the new buildout, the firm has appointed Larry Kravetz as the head of US CRE & CMBS and Frank Gilhool as the head of US CRE warehouse financing.
Both Kravetz and Gilhool join from Barclays. Kravetz most recently led the firm’s US CRE finance business, while Gilhool was most recently head of CRE warehouse finance.
Alongside the appointments of Kravetz and Gilhool, Nomura has also hired Andy DiPietro, Mike Fedorochko, Luke Power, Adam Scotto and Pete Taylor to the US CRE platform – together bringing expertise across origination, financing, structuring, syndication and distribution of commercial real estate assets.
Commercial aviation financing platform Ashland Place Finance has appointed Sarah Conway as director, strengthening the firm's global origination capabilities and presence in Europe. Conway brings more than 16 years of experience in the aviation industry, most recently serving as senior director aviation finance at Hamburg Commercial Bank. Prior to that, she worked at Deucalion Aviation, MUFG and DVB Bank.
Natixis has named Khalid Krim as its new global head of financial institutions group. Based in Paris, Krim joined Natixis in 2023 as global head of banks, asset managers and international public sector coverage and advisory. Prior to this, Krim held senior roles at Credit Suisse, Morgan Stanely and Barclays, including head of European hybrid capital, head of EMEA DCM, and head of investment grade capital markets for the EU.
ARC Ratings has recruited Andrew Steel to serve as its global head of corporate finance and chief analytical development officer in London, as it expands further into corporate finance and private credit. Steel brings extensive sustainability experience to the role, having spent almost 20 years at Fitch Ratings, where he established its ESG ratings division and served as global head of sustainable finance and head of Sustainable Fitch until 2023. He has also held other senior positions such as regional head of APAC corporates and regional head of EMEA corporates.
Viola Credit has recruited Conor Sheehy as md, head of asset-backed lending Europe, based in London. He was previously md, warehouse finance EMEA at HSBC, which he joined in March 2023. Before that, Sheehy worked at Silicon Valley Bank, Neyber, Macquarie and Accenture.
Arini Capital Management has hired cat bond portfolio manager, Shang-Wei Ye, signalling a move into the catastrophe bond market. Ye joins the firm in London from Twelve Securis, where he was promoted earlier this year to deputy portfolio manager for the Securis Catastrophe Bond Fund.
Eagle Point Credit Management, a New York-based private credit manager, has partnered with Apple Bank, a New York consumer and commercial regional lender, to create Newton Commercial Finance, an equipment finance platform. Newton is designed to provide bespoke financing solutions to firms with limited access to traditional bank lending.
Combining the complementary virtues of Eagle Point and Apple Bank, the new platform will provide equipment financing centered on essential assets backed by strong collateral. The ability to provide solutions tailored to the specific needs of borrowers combined with rigorous credit standards is the crux of the new venture.
BlackRock’s HPS Investment Partners and Hoplon Capital subsidiary Vistina are initiating a collaborative effort to bring investment grade securitisation solutions to new borrowers and industries, while expanding investors’ access to esoteric and non-traditional asset classes. Vistina serves clients seeking differentiated advice relating to private, structured credit solutions involving esoteric or non-traditional assets and strategic transactions. These capabilities, combined with HPS’s scale, create a unique solution for clients, while enabling proprietary access to the growing asset-based finance asset class for BlackRock’s investors.
And finally, Oaktree Capital Management has made its first ABF hire in London, marking the expansion of its US-based business into Europe. The soon-to-be-announced recruit is expected to be joined by additional team members shortly, as the firm plans to advertise for a second ABF-related position in London imminently.
Corinne Smith, Caudia Lewis, Simon Boughey, Ramla Soni
