Contents

CLOs

Triple-A liquidity and yield make CLOs a 2026 standout

Triple-A CLOs are positioned well to perform in a falling rate environment

As rates stay low, triple-A CLO debt continues to stand out as an attractive option relative to other fixed income assets, according to market participants speaking with SCI.

The Fed began its rate-cutting cycle with two 25bp reductions in September and October. Despite political pressure for further easing, the central bank has signalled a cautious stance as inflation trends higher - suggesting rates may remain in a higher-for-longer range in the near term.

For CLOs, a declining but still elevated rate backdrop puts the spotlight on credit spreads, which have tightened meaningfully across the capital structure in 2025.

Yet, amid broad tightening across the capital structure, with much of the debt stack trading at or near record tights, triple-A paper in both the US and EU markets continues to show appealing relative value.

Speaking to SCI at its annual Risk Sharing Summit in October, Michael Htun, head of CLOs at Kartesia, describes triple-A debt as the clear standout in the European CLO market.

“Most of the capital structure is trading around the 10th to 20th percentile. Triple-A European CLOs, meanwhile, are at the 46th percentile,” he notes. “Even adding a 30-40bps EURIBOR floor only brings that to the 28th percentile. You’re still lagging the broader tightening in credit — and you’re getting a 3.6% yield for five-year triple-A risk, which is very hard to replicate in fixed income.”

Triple-A CLOs offer attractive short-term option

Janus Henderson (JH) argues that investors repositioning for lower rates should not “indiscriminately rotate from short- to long-duration bonds.” Maintaining a short-duration bucket offers diversification and protection in case long-term yields don’t fall as expected due to higher term premiums fuelled by sticky inflation.

Within this framework, triple-A CLOs provide a strong short-duration alternative. Historically, they have performed well in rate-cutting cycles - such as 2019, when they only marginally lagged short-duration IG corporates.

According to the minutes from the Fed’s meeting at the end of October, dispute different views among policymakers about a potential cut in December, rates are likely to stay higher-for-longer in the short-term, which supports JH’s argument that the current environment is relatively supportive of short-duration fixed income.

Jessica Shill, portfolio manager on the securitised credit team at JH, tells SCI, that while demand from banks, insurers and asset managers remains strong, spreads are unlikely to revisit the tightest prints of early 2025. Still, she believes the asset class will continue to be an attractive option compared to other fixed income asset classes.

“Even as spreads tighten, triple-A CLOs continue to offer an attractive premium over cash instruments like money market funds,” she explains. “After the first Fed cut, demand picked up as the spread differential became more compelling with lower money market yields.”

Liquidity adds to the appeal

Strong liquidity is another factor underpinning the attractiveness of triple-A paper. BWIC volumes in the US and EU are up 21% and 2% year-on-year respectively, according to JPMorgan, with triple-A tranches dominating secondary flow - representing 51% of all activity in the US and 36% in Europe.

Shill describes liquidity in triple-A CLOs as robust, noting that “the $1 trillion asset class continues to grow, and access vehicles such as ETFs provide daily transparency and liquidity.”

She adds that trading volumes typically spike during market stress - including during the LDI crisis, regional bank turmoil and the Russia/Ukraine conflict. “In fact, trading volumes reached a record high in April 2025 amid tariff concerns,” she explains.

CLOs remain competitively positioned

According to Laila Kollmorgen, global head of CLO tranche investments at PineBridge Investments, triple-A-rated CLOs have consistently shown strong risk-adjusted returns in both rising and falling rate environments. Citing JPMorgan data, she notes that triple-A CLOs outperformed IG and HY corporate bonds in both the US and EU across most of the past five years.

“Only in 2020 and year-to-date 2025 has IG outperformed CLOs - and that was a specific duration trade,” Kollmorgen says. “It underscores the strength of the asset class even in a declining rate environment.”

She expects increased supply in IG and HY as a result of the declining rates, which paired with potential rate stabilisation as the US and EU economies pick-up will cause spreads to widen marginally. “As such, positioning in CLOs is a defensive view, especially if we see a pick-up in economic growth in 2026.”

Kollmorgen also points to ETF inflows as another indicator of rising demand: “US CLO ETF AUM is now $41.8bn, up from $21.1bn a year ago.”

She concludes: “Even in a declining interest rate environment, demand for CLOs remains strong. With our views on economic growth, interest rates and supply, we think CLOs are well positioned to perform in 2026.”

Solomon Klappholz

Asset-Backed Finance

Newmark targets burgeoning European data centre pipeline

New co-heads prepare gigawatt of capacity as AI reshapes infrastructure demand

Newmark's newly appointed European co-heads of data centres are preparing to launch between €1bn and €2bn of powered land and investment opportunities in the new year. As the sector grapples with surging demand from AI workloads, the team is ready to dive in further in the central and eastern European market.

Hamish Smith and Oliver Weston, who joined Newmark as partners in September, confirm that they have been busy assembling deals and building capital relationships. "We've been very busy building our book of deals and our pipeline," Smith says. "We're working on a number of live transactions as we speak. But we've been focusing on building that pipeline, getting engagements signed, ready to launch these in the new year."

The duo has assembled a pipeline representing roughly one gigawatt of power capacity across key European markets, including a significant 400-megawatt opportunity in Frankfurt.  The EMEA data centre team is focusing heavily on Germany, Spain and Paris – responding to cloud and client demand across the continent. 

In addition, the duo identifies central and eastern Europe as particularly promising, with Romania featuring in their near-term pipeline. They are also tracking longer-term opportunities in Portugal, the Nordics, Israel and across the wider Middle East.

“Client demand is increasingly diverse and sophisticated, so we need to respond to that. Whether it’s stabilised investment opportunities, platform sales in core markets or powered land opportunities in emerging markets,” Weston says. “We are passionate about Central and Eastern Europe.”

Smith and Weston cite Newmark's combination of US market leadership, debt platform and sister firm Cantor Fitzgerald’s investment banking capabilities as central to why they joined the firm at the present moment. "We both recognised that the Newmark platform gave us the opportunity to offer a true end-to-end service line for our clients," Weston says.

Grid scarcity emerging as biggest challenge

The pair's arrival at Newmark signals the firm's push into a market that has become complex, with cloud computing growth colliding with grid constraints and power demands of AI applications.

According to Weston, grid scarcity has emerged as the biggest challenge shaping the powered land market. Connection wait times across core European markets now stretch between five and eight years, with some UK and Frankfurt sites facing 2035 delivery dates. This scarcity is driving dramatic premiums for power-ready sites, sometimes reaching 100% above alternative use values.

"Grid scarcity is what drives power and land values ultimately, because if power is able to be delivered to a site, we're seeing a very significant premium paid," Weston explains. He notes that hyperscalers typically will not engage unless sites are two to three years from power availability.

The challenges of power availability are compounding as AI workloads reshape infrastructure requirements. While traditional cloud facilities might require 50 megawatts, AI sites typically demand 150 to 200 megawatts as an initial power allocation.

Smith points out that cloud computing alone continues growing at 20% annually, with takedowns expanding from 10-30 megawatts historically to 75-200 megawatts today. “These deals are getting bigger, and they are taking more and more financial firepower to take them down,” he says.

With the demand growth, environmental concerns have also surged in the conversation. Smith says ESG considerations have evolved from optional features to mandatory requirements, as "ESG is becoming a gating factor for eligibility.”

He notes that older, less energy-efficient facilities face financing difficulties, while newer assets aligned with sustainability metrics command better pricing – which might move the market to embrace ESG requirements even further.

Though Smith acknowledges that the challenges are making deals more complex, demand for data centre assets continues unabated. "Every single investor is now shifting their strategy away from the traditional asset classes to enhance their exposure to data centres,” he concludes.

Marina Torres

CLOs

Secondary trading signals a tougher landscape for US CLO equity

Poh-Heng Tan from CLO Research provides insights on this week's US CLO equity which saw several tranches trade or be talked at levels materially lower than on their previous BWIC dates

Overall, the latest BWIC colour shows that prices for these CLO equity tranches have fallen by far more than the distributions received, resulting in negative IRRs, as shown in the table below.

Although the primary CLO market continues to experience solid issuance year-to-date, recent secondary trading colour points to a challenging environment for CLO equity more broadly — characterised by collateral spread compression, a rise in idiosyncratic risks, and many loans still quoted above par, leaving repricing dynamics unfavourable for equity.

That said, this does not necessarily mean that primary investors would be performing poorly; rather, it indicates that had they exited earlier, they would have achieved a better IRR.

The next table presents the primary IRR for primary investors, based on the lower of a price of 95 or the purchase price used for the calculation of incentive fees.

Capital Relief Trades

GSIB surfacing

SRT market update

Goldman Sachs is said to be in the market with a US$5bn risk transfer deal, based on a portfolio 80% composed of investment grade corporate loans, according to market sources.

The GSIB is selling a 0%-12.5% first loss position, but it is tranched, they add.

It is believed that this is the same transaction reported by SCI to be in the marketing phase some six weeks ago.

Simon Boughey

Capital Relief Trades

Programmatic issuer inks pair of SRTs

SRT market update

Santander has finalised SRT deals in both the UK and Spain under its Motor Securities and Magdalena programmes respectively.

The Spanish lender has completed Motor Securities 2025-1, its latest synthetic securitisation of UK prime auto loans. Sized at £609.3m, the transaction follows previous iterations of the programme, with Santander placing £22.9m of Class C credit-linked notes (rated BBB/BBB- by ARC and KBRA respectively) and £27.5m unrated Class D CLNs (corresponding to Tranches C and D respectively). The remainder of the capital structure comprises £523.9m Tranche A, £25.9m Tranche B and £9.14m Tranche E.

As of the portfolio cut-off date of 31 October 2025, the pool comprises 62,084 reference obligations, made up of 54.8% conditional sale agreements, 38.9% PCP agreements and 6.3% lease purchase agreements, secured by both new (33.2%) and used (66.8%) vehicles.

The transaction features a 13-month revolving period, during which the reference portfolio may be replenished, subject to eligibility criteria. Following the end of the revolving period, and in the absence of a breach of a subordination event, the transaction will amortise on a pro-rata basis.

Separately, Santander has closed Magdalena 14, placing €164.4m of CLNs that priced at three-month Euribor plus 6.75%. The transaction references a €2.163bn portfolio of Spanish SME loans.

Dina Zelaya

Capital Relief Trades

Spanish RMBS takes centre stage

SRT market update

Banco Santander has closed its expected cash RMBS SRT deal.

Called Santander Residential 1, the deal is worth €774.9m, of which the AAA tranche of €639.3m priced at 3-month Euribor plus 85bp.

Th AA1-rated B tranche is worth €19.4m and is priced to yield 3-month Euribor plus 110bp, while the A1-rated C tranche is worth €34.9m and yields 3-month Euribor plus 140bp.

The €15.5m Baa2 C tranche yields 3-month Euribor plus 220bp, while the Baa3 E tranche is worth €27.1m to yield 3-month Euribor plus 400bp.

First payment date is April 18 2026 and legal final maturity is October 18 2068.

Simon Boughey

Capital Relief Trades

Big lender to close Czech loan SRT

SRT market update

A major European issuer will close a new SRT transaction referencing Czech assets in the first weeks of December, market sources tell SCI.  

The assets comprise a €3bn-€4bn corporate loan portfolio, originated by the bank's Czech operations. 

The biggest European lenders with significant exposure to Czech assets are UniCredit, Raiffeisenbank and KBC Bank – but sources have told SCI that KBC has no more SRTs in the works at the moment.

The SRT, which sources add is unfunded and bilateral, has been on the radar for several weeks.  

While details such as size and pricing remain unconfirmed, the issuer will likely retain the first loss piece, leaving the mezzanine tranche for the investor.

Nadezhda Bratanova

Capital Relief Trades

Imminent RMBS SRT from European

SRT market update

Allied Irish Banks (AIB) is poised to issue a new SRT trade referencing a €2bn portfolio of residential mortgages, SCI has learned.  

Market sources claim the transaction, which will be AIB’s second SRT, is expected to close within the next week. 

AIB confirmed it is in the middle of working on the deal. In a statement to SCI, a spokesperson said: 

“AIB continues to work on structuring a €2 billion mortgage SRT with a focus on delivering it in the near term, subject to market conditions. AIB anticipates a CET1 uplift of circa 20–30bps, recognising a reduction in RWAs post implementation”. 

The transaction will mark one of the larger RMBS SRTs in the recent years, and comes amid continued investor demand for seasoned, performing mortgage exposures.

Tranche sizing, investor participation and pricing remain unconfirmed.  

This deal follows AIB’s inaugural SRT in November 2024, when the bank transferred risk on approximately €1bn of corporate loans to institutional investors.  

Although the imminent SRT marks AIB’s second transaction in the space it is the first to reference an RMBS portfolio. 

Nadezhda Bratanova

Capital Relief Trades

UK homebuilding finance uses risk sharing

SRT market update

The British Business Bank (BBB) has completed a new credit risk transfer deal of up to £350m with UK merchant banking group Close Brothers, confirms the BBB.

The bilateral transaction, executed under the ENABLE Build umbrella, will cover a portfolio of UK SME residential development finance loans originated by Close Brothers Property Finance. The latter is currently financing the construction of more than 7,000 homes in the UK.

Over the lifetime of the guarantee, the transaction is hoped to unlock more than £700m of development finance, expanding Close Brothers’ capacity to lend to SME developers. 

It mirrors previous ENABLE transactions where the lender retains a 25% vertical slice of the portfolio, while the BBB guarantees the remaining 75%. In addition to this retention, Close Brothers also holds the first-loss position on the guaranteed portion, keeping the lender exposed to initial losses across both its retained and guaranteed tranches. 

From a regulatory perspective, BBB interprets the CRR/UK-CRR framework to mean Close Brothers does not need to hold capital against the 75% covered by the government guarantee, the BBB tells SCI. The 25% vertical slice is treated as if no guarantee were in place, and the structure reduces RWAs compared with an unguaranteed portfolio. 

The ENABLE Build programme aims to increase the availability of development finance for smaller UK housebuilders and BBB operates under the auspices of the Ministry of Housing, Communities and Local Government (MHCLG).

“Following the success of our previous ENABLE Guarantee transaction with Close Brothers, we’re pleased to be building our partnership through this ENABLE Build transaction. Close Brothers Property Finance has been a key supporter of smaller housebuilders for over 50 years, and this support will enable even more SME developers to deliver the homes our communities need,” says Michael Strevens, md, structured financial institutions, BBB said in a statement.

Dina Zelaya

Capital Relief Trades

European lenders to the forefront

SRT market roundup

At the end of this week – the penultimate week of execution of 2025 – Allied Irish Bank (AIB) was preparing to sell a new SRT trade referencing a €2bn portfolio of residential mortgages. This would be the Irish lender’s second SRT, following its debut in November 2024.

The transaction should close before the end of next week and will secure a CET1 uplift of circa 20bp.–30bp, according to the bank.

An undisclosed lender is also poised to close a new SRT transaction referencing a €3bn-€4bn corporate loan portfolio, originated by the bank's Czech operations, according to sources.

The biggest European lenders with significant exposure to Czech assets are UniCredit, Raiffeisenbank and KBC Bank – but sources have told SCI that KBC has no more SRTs in the works at the moment.

Santander, one of the most prolific SRT issuers, has closed SRT deals in both the UK and Spain under its Motor Securities and Magdalena programmes. At just over £609m, Motor Securities 2025-1 is the latest synthetic securitisation of UK prime auto loans.

It also closed its expected cash €774.9m RMBS SRT deal Residential 1, and also Magdalena 14, which references a €2.163bn portfolio of Spanish SME loans.

This week, the British Business Bank (BBB) completed a new credit risk transfer deal of up to £350m with UK merchant banking group Close Brothers. The bilateral transaction, executed under the ENABLE Build umbrella, will cover a portfolio of UK SME residential development finance loans originated by Close Brothers Property Finance.

In the US, Goldman Sachs is said to be in the market with a US$5bn risk transfer deal, based on a portfolio of 80% investment grade corporate loans. This trade was reported to the in the market by SCI some six weeks ago.

Another five days of pricing and deal-making await next week before the market commences the Christmas wind-down and the more pedestrian pace of Q1 resumes.

Simon Boughey

ABS

EU urged to recalibrate securitisation reforms

Council's technical compromise viewed as 'unduly conservative'

AFME and the European Banking Federation (EBF) have published an open letter to the European Council and Members of the European Parliament warning that the EU’s proposed CRR securitisation reforms - which are central to the Savings and Investment Union (SIU) strategy - risk being too conservative, limiting banks’ ability to free up funding for critical sectors such as clean energy, infrastructure and SMEs. The move comes as what is believed to be an unduly conservative compromise agreement has been reached at working level in the Council on certain elements of the CRR calibrations, curtailing the utility of securitisation.

The proposed revision of the EU securitisation framework, unveiled in June, is the first initiative of the European Commission under its SIU strategy and is widely regarded as a litmus test for the EU’s ability to deliver impactful reforms in this area. AFME and the EBF note that it is precisely because its success will set the tone for the future of the SIU that they are expressing concern that the compromise developed at the Council working level risks limiting the potential impact of this reform. The associations’ letter argues that without stronger calibrations, the EU could fall behind the US and the UK, with the reform only delivering limited economic impact - despite political calls to “relaunch” securitisation as a key competitiveness tool.

From an outstanding face value of nearly €1trn prior to the financial crisis, the investor-owned European securitised market stood at just €267bn in 2024 – representing a drop of 70% - according to Schroders Capital figures. At the same time, new issuance stood at €244bn, of which just €144bn was placed with investors (versus being retained by bank issuers). This decline in volumes is primarily the result of more stringent regulations implemented following the GFC; in particular, strict and targeted rules under the current Securitisation Regulation, introduced in 2017.

The Commission’s proposed securitisation reforms are generally viewed as a positive step towards relaunching the market – mainly due their holistic approach, combining measures to amend the Securitisation Regulation (SECR) to increase investor demand and support new issuance, as well as introducing greater risk-sensitivity in prudential calibrations in the CRR. The latter is particularly relevant for banks seeking to use securitisation for risk transfer purposes or to provide direct funding to corporate clients.

Compromise to constrain risk transfer

However, AFME and the EBF argue that the effect of the Council’s compromise agreement - if confirmed - will be to limit banks’ ability to generate additional financing capacity in asset segments central to the SIU. Moreover, the associations view this as being in “direct contrast” with recent calls of EU leaders and as putting the EU at risk of not being able to close the gap between EU securitisation issuances and those in other major economies, for several years to come.

As it stands, the compromise is limiting for most banks, whether they use internal or standardised approaches to determine their capital requirements. In practice, this means that the transfer of risk related to portfolios of larger internal model banks - including critical infrastructure assets - will remain constrained.

Medium-sized banks using standardised approaches and seeking to transfer credit risk across a broad range of market segments will face similar issues. Effective credit risk transfer of retail mortgages, representing low credit risk, will also remain difficult to achieve.

“Overall, banks’ capacity to use securitisation as a tool to finance the corporate sector - both directly and indirectly - will remain constrained in a way that is not the case in other jurisdictions,” the open letter states.   

Further, the compromise is at odds with robust impact analysis – undertaken by AFME last month - demonstrating that only further improvements to the Commission’s calibration proposals would effectively make credit risk transfer available to a broader universe of banks, as well as asset portfolios, and further unlock banks’ direct funding capacity to corporates. The analysis also shows that this can be achieved with ample headroom available to ensure robust prudential objectives.

Call to recalibrate regulatory framework

In a newly-published Position Paper, Schroders Capital calls for the securitisation regulatory framework to be recalibrated in such a way as to foster market participation by a broad range of both issuers of securitisation transactions and investors in securitisations, in order to genuinely unlock funding for Europe’s growth. “Specifically, the market needs a level playing field between EU and non-EU transactions, ultimately leading to better funding for EU businesses, enhanced diversification for EU savers and broader competitiveness of EU capital markets,” the paper notes.

Schroders Capital outlines four pillars that it believes are key to achieving these objectives, the first of which is proportionate, principles-based disclosure and due diligence requirements. This would enable EU investors to invest on equal terms in both EU and third-country securitisations, cutting red tape and levelling the playing field to allow for optimal returns.

The second pillar is the introduction of clear definitions for ‘public’ and ‘private’ securitisations, which would serve to facilitate transparent assessment of regulatory implications. The third is the recalibration of sanctions related to due diligence obligations to avoid the threat of duplicative and disproportionate penalties that could otherwise disincentivise investors. Finally, the paper calls for more risk-sensitive calibration of capital charges under Solvency 2 to enable insurers to meaningfully participate in securitisation markets.

“Without political impulse to guide changes in this direction, and away from the choices presently made at technical level, we will simply not see the expected revival of the securitisation market,” the AFME and EBF letter concludes. “As a result, banks will be unable to use securitisation effectively to finance strategic EU priorities. There is a serious risk that the European Commission’s proposals, which laid important groundwork for effecting meaningful change, may end up having only very limited economic impact.”

Corinne Smith

Asset-Backed Finance

Flexam eyes transport deals for niche origination

European lender gaining traction in the Nordics, Netherlands and Germany

Flexam Invest is eying new origination opportunities in the transport sector. The European lender is bullish on new origination capabilities, given the EU objective of moving road transport to rail.

“[This] is driving significant investment in locomotives, wagons and intermodal equipment,” says managing partner Fabrice Fraikin. “These assets are long-life, high-utilisation and contracted, yet the sector is capital-intensive and under-financed by banks.”

Flexam is seeking to capitalise on stricter Basel 3 regulations and rising real asset financing needs, which it sees as creating a market gap for investing in asset-heavy mid-market companies. Although Pan-European in nature, the firm is seeing particularly strong traction in the Nordics, the Netherlands and Germany.

“Germany offers a deep pipeline driven by its industrial base and its commitment to upgrading transportation equipment, including rail and specialised logistics assets,” says Fraikin.

In 2023, the firm supported the expansion of CargoBeamer, a German intermodal transport group, by financing a fleet of 40 intermodal wagons operated by CargoBeamer Rolling Stock.

Fundraising for KAF III

Flexam’s strategy focuses on senior secured asset-backed lending and the firm is currently raising its third fund, targeting €500m, having recently closed on €200m.

In a transition from its predecessor, Kartesia Asset Finance III will aim to build an investor base of 70% institutional LPs, compared with Fund II, which raised €300m in February and is split around 50% between private investors. This reflects the growing interest from large investors in deploying sizeable tickets into defensive, asset-backed strategies. Flexam typically targets B2B transactions between €15m and €85m.

In September, the EIF committed a €50m ticket to the fund, partially backed by the InvestEU programme, which mobilises investment for EU policy priorities, such as the green transition and continued support for SMEs.

Sourcing and underwriting approach

Flexam sources its deals through internal and external channels. Internally, deal flow is either direct or off-market, creating active relationships with operators to benefit from repeat transactions and to be approached directly by operators seeking tailored ABF solutions.

“Externally, we work with specialised brokers, banks and advisors in land transportation. These partners provide a steady flow of opportunities, and around 60% of our origination comes through these intermediated channels,” notes Fraikin.

The firm’s underwriting approach focuses on four main pillars, the first of which entails sourcing across networks of operators, brokers, banks and consultants. From here, the firm screens asset quality and counterparty strength.

Next, the firm manages credit due diligence and the structuring of terms, pricing and security packages, culminating in deal execution and post-investment monitoring. The process allows for predictable senior secured exposure and strong collateral protection.

Jacob Chilvers

Asset-Backed Finance

NLC expands investor base for sub-line fund

Vehicle expects to hit up to US$3bn in commitments next year

NLC Capital Partners has hit US$750m for its new subscription line financing fund, SCI has learned. NLC Fund Financing IG Short Dated is an open-ended Luxembourg-domiciled vehicle that makes short-dated loans to private credit and private equity funds.

The London-based firm has US$750m secured, with another US$250m in the pipeline, and is looking to reach up to US$3bn by the end of next year, sources told SCI.

Also known as capital call facilities, subscription lines are typically short-dated credit facilities taken out by drawdown funds, secured against LPs’ commitments, which allow GPs to call capital quickly and efficiently if an investment opportunity presents itself.

At its launch in June this year, the fund was predominantly drawing in insurance capital - primarily due to the firm’s previous separately managed account approach, which had attractive structuring flexibility. However, in recent months, the fund has expanded its investor base to include commitments from challenger banks, endowments, corporate treasuries and family offices, sources added.

The firm offers euro- and sterling-denominated sleeves; however, its base currency is in dollars. Liquidity options of one month, three months, six months and 12 months are also built into the redemption terms.

NLC Capital Partners was founded in 2021 by Investec pros Slade Spalding and Neno Raic. Since its inception, the firm has funded over US$6.5bn in loans.

Sub-line financing has seen a large uptick in popularity in recent years. Since the collapse of Silicon Valley Bank in 2023, a major provider of capital call facilities, other managers - such as Värde and Aegon - have also launched new funds. While Värde’s strategy will source loans from banks via forward flow agreements, NLC will typically originate loans directly.

NLC declined to comment.

Jacob Chilvers

Asset-Backed Finance

ABF Deal Digest: erad breaks new ground with scalable funding facility

A weekly roundup of private asset-backed financing activity

This week’s roundup of private ABF activity sees Riyadh-headquartered SME financing platform erad secure US$125m from Jefferies, with co-investment from Channel Capital, to accelerate embedded finance solutions across the GCC. The transaction marks Jefferies' first GCC asset-backed financing transaction and will support the firm’s plans to grow its presence in the region.

Building on erad's strong 6x year-over-year growth and over US$700m in funding requests, the scalable funding facility offers significant expansion capacity to meet growing demand from SMEs in Saudi Arabia and the rest of the GCC. Funds allocated for Saudi SMEs will be deployed through CMA-licensed direct financing funds managed by Erad Partners Capital.

Following this transaction, erad is expanding into multiple sectors and products - including embedded finance products - enabling suppliers and business platforms to offer integrated financing at the point of sale. The model is already live with several strategic partners, including suppliers of healthcare and food and beverage products in Saudi Arabia and the UAE.

SMEs represent the backbone of the GCC's economic diversification efforts, contributing approximately 50% of regional GDP and employing two-thirds of the workforce. Despite their critical role in driving Vision 2030 objectives and other economic transformation across the Gulf states, SMEs face a significant US$250bn financing gap that limits their growth potential.

Corinne Smith

ABS

Germany's enforcement shift: bypassing the estate to realise alpha

Dagmar Gold, managing partner at Deutsche Pfandverwertung, argues that structured credit markets must rethink recovery timing

Three years post-ruling, the operational reality of the German Federal Court of Justice (BGH) ruling IX ZR 145/21 is finally hitting home. For secured creditors, the delayed recognition of independent enforcement rights is creating a divergence between modeled LGDs and actual realised value.

For structured credit investors modeling exposure to German corporates, the insolvency process has long been priced as a drag on performance. Models typically assume a ‘black box‘ scenario: once a borrower files for insolvency, collateral realisation drifts into the control of an administrator, resulting in significant time lags and heavy cost leakage due to estate fees.

However, for deals secured by pledged shares or intangible rights (such as IP, patents and trademarks), this assumption has been legally obsolete for three years. BGH IX ZR 145/21 fundamentally altered the enforcement landscape. It clarified that the administrator’s right to realise moveable assets does not extend to rights.

Consequently, pledged shares and IP fall outside the insolvency estate. They are effectively ‘bankruptcy remote‘ regarding realisation authority.

Despite this clarity, market uptake has been slow. Only now, amid accelerating insolvencies and weakened borrower reporting, are the operational consequences fully materialising. For the structured credit market, this delayed recognition is creating a dangerous gap between legal theory and enforcement reality.

The cost of inertia: the ‘consent trap‘

The most significant drag on recoveries today is not the law, but habit. In many workout scenarios, creditors inadvertently allow value to leak back into the estate because they fail to operationalise their independence fast enough.

This occurs primarily through the ‘Consent and Realisation Agreement‘ (Zustimmungs- und Verwertungsvereinbarung). In the chaotic ‘twilight zone‘ between covenant breach and filing, administrators often persuade pledgees to sign agreements permitting the estate to sell the pledged assets.

From a recovery perspective, signing this is effectively a voluntary ‘haircut‘. It triggers:

1. Fee leakage: it subjects proceeds to estate fees (typically 9% plus VAT) and advisor costs.
2. Loss of control: realisation becomes tethered to the estate’s slower timeline.
3. Allocation risk: in bundled asset deals, Purchase Price Allocation (PPA) becomes opaque, often disadvantaging the secured creditor.

The operational shift: ‘hybrid M&A‘ via statutory auction

To close the gap between potential and realised recovery, creditors must embrace a new enforcement pathway. The most robust mechanism under German law is the Statutory Public Auction (Öffentliche Versteigerung) integrated into an M&A framework - a process best described as ‘hybrid M&A‘.

This is not a liquidation fire sale. It is a sophisticated process executed by a publicly appointed and sworn auctioneer (Allgemein öffentlich bestellter und vereidigter Versteigerer), comprising:

1. The marketing phase (the M&A component)
   The process mirrors a distressed M&A deal. The asset is marketed internationally to strategic investors in a discreet, competitive environment. Due diligence is performed and market pricing is established.

2. The closing mechanism (the sovereign component)
   This is where the model diverges from a private treaty sale. Instead of a Share Purchase Agreement (SPA) with its negotiation risks, the transaction concludes with a Sovereign Award (

Implications for credit risk and finality

The Sovereign Award offers distinct structural advantages:

• Elimination of execution risk: The award combines signing and closing into a single, instantaneous act. There is no gap, removing the risk of deal collapse.
• The ‘valuation shield‘: One of the biggest risks in enforcement is the post-closing challenge. The Sovereign Award creates a non-negotiable price determination. Legally, the hammer price is the fair market value. This provides a liability shield against ‘under-value‘ claims that a private sale cannot offer.
• Clean title: The award extinguishes lower-ranking liens and provides the buyer with original title instantly.

Recalibrating LGD models

The persistence of ‘old fashioned‘ enforcement suggests that recovery models need updating.

• Timing: Models assuming 18-24 months for estate realisation should be adjusted to 4-8 weeks for creditor-led enforcement by statutory public auction.
• Costs: Estate cost deductions should be removed from LGD branches where independent enforcement is viable.

The legal framework in Germany has shifted from estate-driven management to creditor-led enforcement for key collateral classes. However, this alpha is only realised if creditors actively bypass the estate.

As insolvencies accelerate, the window to prepare independent enforcement is narrowing. Lenders that rely on estate-led processes will find their recoveries lagging behind those who operationalise their rights early.

Biography
Dagmar Goldis a managing partner at Deutsche Pfandverwertung. As a publicly appointed and sworn auctioneer and a certified restructuring and reorganisation advisor (IfUS), she specialises in the intersection of legal enforcement and distressed asset recovery. She advises international credit funds on realising pledged collateral via statutory auctions and hybrid transaction models.

CLOs

Resets drive record year for European CLOs

Experts at SCI's and Reed Smith's CLO event on 4th November discuss the nature of the CLO market in Q3 and what it looks like heading into 2026

It has been another strong year for the European CLO market, which has exhibited continued growth in terms of volume, manager ecosystem, and its investor base. EU CLOs have notched record YTD new issuance at approximately €54bn, with net supply slightly lower at €35bn. But, overall the market has seen substantial growth with around €280bn in outstanding vehicles.

Dustin Walpert, European CLO strategist at Bank of America, describes the primary market as similar in dynamics to last year, noting however that refi/reset activity has picked up significantly with much of this activity being skewed towards resets. Of roughly €52bn in refi/resets, almost all consisted of a broad range of reset types.

These ranged from 2022–2023 wide-coupon deals that were economically attractive to reset, to some of the first 2024 vintages being reset as they exited their non-call periods.

More significantly, Walpert highlighted the reset of out-of-reinvestment-period deals, e.g., from 2018/2019 vintages, some of which had already amortised a substantial portion of their principal. With NAVs deflated to levels that made calling the deals and crystallising a low IRR unattractive in some cases, majority equity holders instead chose to reset the vehicles and effectively start anew.

Meanwhile, in terms of trading volume, the secondary market looks very similar to last year, with €14bn of BWIC supply YTD, dominated by triple-A, triple-B, and double-B trading.

Volatility disrupts record tights, spreads recover 

In terms of spreads, since market volatility following the Liberation Day sell-off in April, CLO spreads have bounced back to record tights until late September where the collapse of auto-parts lender First Brands created further, albeit less lasting, volatility in the market.

Pauline Quirin, portfolio manager at TwentyFour Asset Management, describes the dispersion picture in Q3 as negative, with new issues pricing very close to resets, adding that some of the older resets from 2018-2021 were not necessarily cleaned-up but still pricing at 300bps for triple-Bs and 500bps for double-Bs - close to record tights.

“We took the opportunity to exit some of those positions due to the lack of premium in those resets,” Quirin notes.

But in Q4 the picture is very different, according to Quirin, stating that  “loan dispersion has directly translated into a clear pricing tiering. Now we are seeing atleast 50bps of premium for non-clean resets compared to a new issue for BB CLOs”.

The panellists agree that this dispersion is increasing the differentiation between Tier 1 and Tier 3 managers, with increased investor scrutiny on portfolio quality and manager behaviour.

Looking at how the diversified manager base has handled the recent number of idiosyncratic credit events, Barry Povey, portfolio manager at Fair Oaks Capital, says the cohort of managers running slightly “higher octane portfolios are starting to show some stress in a way that they maybe haven’t done over the last two years”.

EU equity attractive compared to US 

On the equity side, as loan repricing spreads tighten, there is some concern in the market about future cashflows, although this compression has been more emphasised in the US compared to Europe, with around a 50bps gap in weighted average spread between deals in their reinvestment period.

Despite a strong start to the year, starting at 5% for deals inside their reinvestment period, cash-on-cash distributions have declined by about 1 percentage point on a quarterly basis by Q4, according to Walpert.

Going forward, he says loan repricings paused in October for the most part and as such the market had a little bit of respite, but due to the level of bifurcation in the loan market this may not last long. He points out that if the technical gets stronger once again we might see more loan repricings which could spell further downside for cash-on-cash distributions.

Povey points out that given the idiosyncratic credit events and spread compression we’ve seen this year, investors need to ‘pick their spots’ on the equity side, adding that looking at broader market exposure investors have preferred lower mezz paper of late as it offers high returns while still giving the par subordination to weather losses from defaults.

Regulatory shake up

After a quiet period in recent years, CLO regulation has seen a renewed focus from the European Commission with the most significant being the clarification around the predominant revenue test and the Q&A response regarding the use of conditional sale agreements.

The Q&A response regarding the use of conditional sale agreements for seasoning assets, however, has had the greatest impact on the market. Jennifer Ellis, counsel at Reed Smith, explained that managers had previously opted to use conditional sale agreements rather than forward purchase agreements to avoid falling within the  falling within the scope of US risk retention rules.

However, when evaluating their existing deals, many managers found they also satisfied Limb (a) of the definition of “originator” meaning that their existing deals were still in compliance, whereas others have had to take remediation steps to bring their existing deals back into compliance. Manager-originator structures using the forward purchase agreements to season assets, according to Ellis, should still be able to rely on the open-market exemption for the purposes of the US risk retention rules, whereas this is not the case for third-party originators and they will have to explore other potential exemptions available under the US risk retention rules.

Next year promises a number of amendments to the European Securitisation Regulation, with the EU Commission introducing definitions for public and private securitisations. Ellis highlights that the market is confident CLO transactions and warehouses will fall within public securitisations under the current proposal, with expectations that market participants will opt to move listings out of Europe so that their warehouses can qualify as “private transactions”.

Additionally, the regulator has proposed amendments to the Capital Requirements Regulation and Solvency II, which Ellis says “could potentially widen the potential investor base for CLOs which would have a positive impact on the CLO market”.

She notes that the changes are aimed at differentiating between tranches and reducing the capital charges for the more senior tranches, which if accepted would remove a key barrier for certain investors and promise to expand the CLO investor base.

Defaults to stay elevated

The softening loan market, which began in August after the downgrade of a few notable triple-C names including Merlin Entertainment, created a cautious sentiment that was amplified by the First Brands default and only increased the bifurcation in the loan market. This dynamic is expected to stay in place moving into 2026.

Although there has been an uptick in triple-C buckets, the impact this has had on cash flows and structural tests has been manageable. Povey states he has seen the “threat of triple-C affect market dynamics”, however, and that the loan market’s pricing has been more responsive to any negative news around potential stress. 

Sector-related stress is expected to continue, with chemicals, automotive, and business exposed to AI disruption highlighted as key risk areas to watch heading into the new year. As such the panel concurs defaults will remain marginally elevated and the market will see more dispersion and tiering across deals and managers as a result.

“This year was all about carry and I believe next year will be about risk management with a much greater focus on manager selection, structural discipline, and liquidity,” concludes Quirin.

Solomon Klappholz

SCI would like to thank all market participants who attended our third CLO panel discussion and to Reed Smith for hosting. To book your place at upcoming SCI events and conferences, please visit our events page. 

ABS

Inside Enpal's Golden Ray 2: A blueprint for resilient green ABS

Gregor Burkart, senior vp asset financing at Enpal, answers SCI's questions about the firms second public ABS transaction, Golden Ray 2

Q: Enpal’s second public ABS transaction, Golden Ray 2, began marketing in November, shortly after announcing a new warehouse with M&G, [and announced initial price talks this week]. The deal introduces a few structural differences compared with your inaugural public ABS. Can you walk us through what’s new?
A: On the asset side, the two main additions are the heat pumps and our financial services platform business. Those bring some implications – for instance with heat pump loans they only run for up to 15 years which affected the legal tenor. But the borrower profile behind the heat pumps is essentially the same as with solar – German homeowners – so there’s no meaningful shift in the underlying credit.

Then on the liability side, we didn’t include an EIF warranty this time around, but we still achieved a triple-A rating on the senior notes, which we were very happy with. The detachment point of the senior tranche was also a bit higher, which again reflects the strong credit quality.

Another change is that we included a four-year call date, instead of five as with Golden Ray 1. That was deliberate, to allow us to align the call dates for Golden Ray 1 and 2 so we could potentially refinance them into one new transaction down the line. Lastly, we took a slightly more sophisticated approach to hedging with this transaction, which is a minor point but another evolution for the programme.

Q: Was the inclusion of heat pumps a challenge form a structuring or rating perspective, given the limited performance history?
A: A lack of track record will always be a structural challenge for any new product. We’ve only been offering heat pump financing for around a year and a half, so the history isn’t as deep as with our solar loans – but because the borrower base is almost identical, we were able to overcome that hurdle. We now have over six years of performance history on solar lease and loan assets and we were able to use that to help the rating agencies get comfortable with the new collateral.

The technology is also more complex – solar PV systems don’t have moving parts, but heat pumps do. With solar, you can just flick a switch and it runs. Heat pumps are a different story and have much more technology and mechanical complexity involved – which introduces more technical risk. Through technology-driven, innovative approaches we are nonetheless able to still determine installations issues very early in the process. But again, we were able to socialise that with the rating agencies and it ultimately didn’t pose a block in the road. About a quarter of the portfolio is now made up of heat pumps, and I don’t expect that to go down – on the contrary, market dynamics are suggesting that they’ll remain a core part of the Golden Ray platform going forward.

Q: Were the complexity, collateral or sustainable components of the deal something you had to factor into your choice of rating agencies?
A: Actually, not especially. We didn’t face any major structural challenges around the heat pumps specifically. Our main consideration was around the triple-A tranche, which we wanted to make sure we got the appropriate rating for given the quality of the underlying collateral. Different agencies have different approaches, and some apply caps or haircuts that could have impacted that rating outcome. So, this time, we went with Moody’s and Scope, the latter of which was able to rate that senior tranche as triple-A – which was one of our key structural objectives.

Q: Looking ahead, are there other types of assets you’re considering securitising beyond solar and heat pumps?
A: It’s a good question. We operate both a project finance and securitisation platforms. The project finance side is very useful when we’re still ramping up originations, but some asset classes are of course better suited to securitisations once they’ve scaled.

The two areas I’d highlight here are our C&I business and our smart meter vertical. We launched our C&I business about a year ago, which leverages our procurement and installation capabilities for commercial properties – whether that’s supermarkets, storage halls or so on. That’s currently financed via project finance, but since the market’s seen its first C&I ABS deals hit the market and there’s real momentum there, that could be a potential for us.

Second, our smart meter vertical, we have scale to around 50,000 smart meters now, and so it could be a great candidate for securitisation in the future. As our business expands and our verticals mature, we’re likely to see more opportunities to securitise ancillary equipment and new renewable asset classes.

Q: In terms of investor feedback, has the recent turmoil in the US solar ABS market affected how people view Golden Ray 2?
A: Absolutely. We’ve had more and more questions on this over the last few months. But I think that’s actually been a real positive, because the structural differences between the US and European markets could not be more stark – so these conversations are a great chance for us to explain that.

For example, the US solar ABS market was heavily built around tax equity incentives – and when those incentives disappeared, the economics collapsed. We don’t have that structure in Germany. And pricing, too, was also much more inflated in the US with the same system costing somewhere around 40% less in Germany than the US – which itself suggests quite unsustainable margins over there.

Of course, the quality of underwriting has also deteriorated in the US, and there’s been speculation about issues with servicing too. That’s another key difference, because at Enpal everything is internalised. We do our own underwriting, installation and servicing – we’ve currently got around 1,800 installers on our payroll. That gives us really tight control over quality, auditing and customer service – much tighter than what investors saw go wrong in the US.

Q: ESG is a big part of the Golden Ray story. How has investor appetite for green-labelled ABS evolved compared to your first deal?
A: It’s still a bit early to draw full conclusions from Golden Ray 2’s marketing phase, but for us the green label affected pricing for us or compressed margins. ESG labels haven’t generated a ‘greenium’ or reduced spread levels, but it has certainly opened doors. Certain investors that are actively seeking ESG exposure for regulatory reasons or due to LP pressure, and the green aspect makes us more visible to them.

But what’s becoming clear is that this product gives investors access to something rare – which is German homeowners. That’s not a typical public market asset class. Germany doesn’t have a deep RMBS market, so this is actually a unique opportunity for exposure to these prime residential consumers in Germany.

Q: What’s your view on upcoming changes to the EU securitisation regulation? Could it affect Enpal’s ambitions for the ABS programme – whether for better or worse?
A: On the investor side, regulatory changes may actually be a help. The EU is revisiting parts of its securitisation framework, and we might see positive changes – less red tape, relaxed due diligence requirements for investors, better capital treatment for ABS relative to corporates and changes to location bucket constraints that currently penalise the asset class. If these things do materialise, it could boost demand.

On the origination side, we’re watching two developments. One is the EU’s Consumer Credit Directive, which might bring regulatory changes to our business. The other is the heat pump subsidy regime, which is a political debate at the moment. Either of those could affect origination volumes, but as of now, we feel we’re operating in stable waters and well positioned to grow.

Q: And what’s your ambition for future issuance – more public deals, more warehouses, a mix of both?
A: As we’ve said from the offset, we want to be a regular ABS issuer to help develop the asset class and tighten spreads. But we also want diversification. 

So we’re ramping up private distribution channels in parallel with our ABS strategy. We’re particularly interested in how we can make this asset more accessible for insurance companies and pension funds in a private format. But overall, it’s about creating a diversified set of distribution options for our receivables.

Claudia Lewis

Asset-Backed Finance

Democratising structured capital solutions

Duncan McKay, partner and head of fund finance at Gibson Dunn in New York, answers SCI's questions

Q: You recently joined Gibson Dunn as the head of fund finance and a partner in New York. What attracted you to the firm at this point in your career and which opportunities do you see in leading its fund finance practice?
Duncan McKay: I was drawn to Gibson Dunn not only because it offered the opportunity to join an already premier fund finance platform, but also because it presented an opportunity to build - deliberately and strategically - an elite fund finance and structured capital capability that operates seamlessly alongside the firm’s market-leading investment funds practice. Gibson Dunn is one of the most prestigious global brands, with extraordinary momentum and a history of delivering exceptional results for clients across its worldwide practices.

The firm’s value proposition is truly unique, and I wanted to contribute to that growth while continuing to develop my practice on such an elite global platform. At Gibson Dunn, my focus is on delivering the highest level of expertise and client service to our asset management, sponsor and direct lender clients, and on building the practice in a way that reflects the evolution of the fund finance industry itself: into a cross-disciplinary, dynamic, global offering that can support clients in their most important and sophisticated transaction - whether that be in the US, Europe, Asia or the Middle East.

Q: What role do you see structured finance products playing as traditional fundraising becomes more challenging for alternative asset managers? How do you advise clients on choosing between different financing structures to meet their needs?
DM: When advising clients on which financing or fundraising solution best meets their needs, we start by identifying the client’s core objectives and then bring to bear our collective expertise in structuring and implementing the solutions, irrespective of the fundraising environment. Structured finance products are playing an increasingly central role in how alternative asset managers access liquidity and deploy capital. Our business - and the broader fund finance industry - has evolved significantly in response to this demand.

Ten years ago, the market was still predominantly subscription-facility driven - and 15 years ago, ‘fund finance’ was effectively a cottage industry and, quite frankly, not the practice area on which lawyers at elite law firms wanted to spend time. That has dramatically changed, and actually the writing was on the wall 10 years ago as to how this business would evolve and it is why I made the decision when I did to focus on what was clearly becoming a dynamic and rapidly evolving area of legal practice.

Today, the fund finance ecosystem is exponentially more sophisticated and interconnected. Managers now rely on a much wider array of financing and capital-formation tools, including subscription lines, NAV and hybrid facilities, GP-level solutions, preferred equity, structured credit and capital-markets products. These solutions often cut across multiple ‘traditional’ practice areas, requiring integrated advice that spans fund finance, structured finance, capital markets, tax, investment funds, and domestic and offshore regulatory regimes - including insurance regulatory considerations. Our borrower clients are now also lenders.

The rapid expansion of available financing and fundraising tools means the next generation of fund finance lawyers must be fluent across these disciplines, and our goal at Gibson Dunn is to train the next generation of leading fund finance lawyers. Cross-functional expertise is no longer optional; it is essential to advising clients and to being at the forefront of this evolving and increasingly sophisticated space. 

Q: How has the fund finance landscape evolved throughout your career? Which emerging trends are you seeing in NAV-based lending and GP finance transactions?
DM: We expect continued innovation in fund finance and structured capital solutions as the private markets expand, democratise and become accessible to new classes of investors. As asset managers operate across multiple jurisdictions and increasingly complex regulatory regimes, the demand for integrated, cross-border financing and fundraising solutions will only grow.

We anticipate significant advances in NAV and hybrid products, the continued institutionalisation of GP- and management-company financing, and greater use of structured capital solutions, such as rated note feeders and collateralised fund obligations to bolster traditional fundraising. Our clients are already global, and they expect elite, coordinated service across time zones and legal systems.

Q: How is Gibson Dunn positioned to lead in those areas?
DM: Gibson Dunn is exceptionally well-positioned to lead in this next phase of the market’s evolution. Our geographic footprint, combined with strength across fund finance and structured capital, private funds, tax, regulatory, capital markets and restructuring, allows us to deliver seamless, multidisciplinary advice at the highest level. As the market continues to develop and investor bases broaden - including the growing retail access to private markets and the developments we’re seeing in the defined contribution space - Gibson Dunn’s platform positions us to guide clients through both the emerging opportunities and the heightened complexity that accompanies them.

Marina Torres

Structured Finance

Job swaps weekly: Fitch succession plan kicks into action ahead of Duignan retirement

People moves and key promotions in securitisation

This week’s roundup of securitisation job swaps sees Fitch Ratings making a wave of changes in its global analytical leadership team, as part of a succession plan surrounding the retirement of Kevin Duignan. Elsewhere, a widely revered industry veteran is to step down from her partnership at Reed Smith at the end of the year, while Mount Street Group has named a new executive director and head of transactional legal.

Fitch Ratings has made several changes to its global analytical leadership team. Jeremy Carter has been appointed global analytical head, with effect from January, and will also join Fitch Ratings’ executive team. 

As part of the restructure, Rui Pereira, global group head for structured finance, will expand his remit to include the Ratings’ Fund and Asset Management (FAM) analytical team. Marjan van der Weijden will assume Carter’s role as global group head for corporates and infrastructure and Laura Porter, global group head for public finance, will expand her responsibilities to include financial institutions. Van der Weijden, Porter and Pereira will all report to Carter.

Carter succeeds Kevin Duignan, who will retire after a career at Fitch Ratings spanning over three decades. Duignan will continue to support the business until the end of June, with the intention of ensuring a smooth handover during the leadership transition, the firm says. During his tenure at Fitch Ratings, Duignan has held a multitude of regional and global roles including global group head for both financial institutions and structured finance.

Meanwhile, Tamara Box will be stepping down from her partnership at Reed Smith at the end of the year and transitioning into a senior consultant position role at the firm, while dedicating more time to her advisory roles within the industry and external charitable efforts. Box has been with Reed Smith for almost 15 years, having previously served as partner and head of international structured finance at Berwin Leighton Paisner. Prior to that, she was a partner at Hogan Lovells.

A longstanding industry titan, Box has advised on a series of landmark, first-of-their-kind transactions across the Islamic and emerging markets – including the first Shari’ah-compliant RMBS out of Saudi Arabia, the first cross-border securitisation in South Africa and the first CMBS in Dubai. She has acted on securitisation deals worldwide, including restructurings of deals affected by the GFC.

Box is the founding member of Women in Structured Finance and 30% Club, and is widely recognised as a mentor and advocate to many within the structured finance community.

In stepping back from partnership, she will now concentrate on her external commitments, including serving as non-executive chair at Interpath Advisory, non-executive director at Hanover Investors Management, a trustee of the Chartered Management Institute and chair of the board of trustees at gynaecological cancer charity The Eve Appeal.

Mount Street Group has promoted Iain Balkwill to executive director, head of transactional legal. In this role, Balkwill will take responsibility for all legal transactional matters across the firm, with primary responsibility for managing and supervising its in-house counsel in relation to the origination and onboarding of transactional matters across the group. He will also oversee the origination and onboarding process for these matters, while providing secondary support through general legal advice across the company.

Balkwill will report to James Buncle, general counsel, and will manage and oversee the transactional legal team. He has over 20 years’ experience advising on the origination, securitisation, servicing, syndication, warehousing, restructuring and enforcement of loans secured by commercial real estate. Prior to joining Mount Street, he was a partner at Reed Smith, which he joined in February 2012 from Berwin Leighton Paisner.

Paul Weiss has added two new project finance partners in New York, including Jamie Franklin, whose background spans both project finance and structured finance. Franklin joins from White & Case where he had served as partner since 2020 in Singapore before relocating to Texas. His practice spans structured financing platforms, holding company and hybrid financing, project bonds, private placements and other structured products for energy and infrastructure assets. 

In his new role, Franklin will advise private equity sponsors, corporate borrowers and institutional investors on large-scale project development and financing transactions, working alongside fellow new hire Kelann Stirling, who will lead Paul Weiss’ project finance and development practice.

Matteo Gervasio has joined Auto1 Group as head of structured finance, based in Frankfurt. Gervasio left his role as director for asset-based lending at Hamburg Commercial Bank in October after three years with the business. He previously held a variety of director level roles at MBCredit Solutions, Encore Capital Group and PRA Group. Earlier this year, Auto1 notably completed its Financehero 2 transaction, marking the first European public securitisation to pool auto instalment purchase receivables from multiple jurisdictions.

JLL has promoted Brad Greenway to head of debt and structured finance for APAC, effective from the start of next year. Greenway, who will retain his current position as co-head of debt and structured finance for EMEA, will oversee the firm’s operations across Asia and Australia from his London base. Greenway joined JLL in 2019 through its merger with HFF, and is viewed as being well placed to lead the continued efforts of its structured real estate finance platform into Hong Kong, Singapore, Sydney, Mumbai and other key APAC markets, replicating the team’s approach in EMEA.

And finally, the African Development Bank Group has appointed Societe Generale as lead advisor for the structuring and execution of its Multi-Originator Synthetic Securitisation (SST) Platform. The SST Platform will operate as a revolving, evergreen and scalable risk-transfer vehicle offering development finance institutions regulatory capital relief, improved balance sheet resilience and a pathway to mobilise private investment at scale.

With its expertise in SRT transactions, Societe Generale will play a lead role in the design and structuring of the platform ahead of its launch, while offering financial modeling and preparation of investor outreach materials. The initial phase of the SST Platform targets a US$2bn reference portfolio featuring diversified sectors, geographies and risk profiles, combining assets from the African Development Bank, Development Bank of Southern Africa and potentially other institutions.

In the long-term, the SST Platform is expected to introduce harmonised issuance documentation, standardised credit assessment approaches and a shared SPV structure to attract participation by additional African and international development finance institutions.

Claudia Lewis, Corinne Smith, Ramla Soni, Kenny Wastell