GSO Diamond Portfolio Fund, a newly formed US$950m investment fund sponsored by GSO Capital Partners, has closed on the acquisition of approximately US$2.4bn in corporate loans and other credit investments from NewStar Financial (SCI 20 October 2017). Immediately following the sale of these assets to the fund, NewStar was acquired by First Eagle Investment Management. NewStar's credit platform and investment teams now form First Eagle's alternative credit group, which has been engaged by GSO to assist in servicing the assets acquired by the fund.

Dyal Capital Partners has made a strategic minority investment in Cerberus Business Finance (CBF), the middle-market lending platform of Cerberus Capital Management. There will be no changes in the day-to-day management or operation of CBF, or to its decision-making or investment process, as a result of this passive non-voting investment.

North America
Richards Kibbe & Orbe has promoted Victor Ludwig to counsel. He practices in the firm's corporate and business transactions group and is based in New York. Ludwig concentrates on credit and credit derivatives, marketplace lending and bankruptcy claims trading, representing both dealer and buy-side clients in analysing and negotiating total return swap facilities. "Victor has established himself as a go-to attorney for both dealer and buy-side clients in the finance and derivatives spaces," says managing partner Jennifer Grady.

Josh van Manen, former regional head of structured finance at Fifth Third Bank has re-joined the bank after three years away. He began his career at Old Kent Bank, which was acquired by Fifth Third, and became a relationship manager in the structured finance group before becoming west region head for structured finance. He was also svp and md in the sponsor leveraged finance team before leaving the bank to found Elevest. He has re-joined as svp and commercial relationship manager in Grand Rapids.

Fried, Frank, Harris, Shriver & Jacobson has appointed Darren Littlejohn as a partner in its derivatives and asset management practices, based in New York. He joins from Blake, Cassels & Graydon and has also worked for Goldman Sachs. "Darren has a very strong derivatives background and unique cross-border experience that will further expand the depth of our structured finance expertise," says Lawrence Barshay, partner in Fried Frank's corporate department and head of its asset management practice.

CanAm Enterprises has recruited Gary 'Skip' Stern as md of legal affairs. He joins from Sidley Austin, where he spent 35 years and led the global finance group and focused on a variety of lending and securitisation transactions, with his securitisation work typically involving representing financial institutions in transactions involving non-traditional and esoteric asset classes.

Ratings
CARE Ratings Nepal has commenced operations after being issued a credit rating licence from the Securities Board of Nepal. The rating agency will provide ratings for various instruments, including structured finance and other debt instruments. The new rating agency is 51% owned by CARE Ratings India, formerly known as Credit Analysis and Research.

Repo agreement
Oxford Lane Capital has entered into a repurchase transaction with Nomura Securities International under which it has sold US$106.2m of CLO securities to Nomura for a purchase price of approximately US$42.5m. Oxford Lane is obligated to repurchase those securities at the end of the repo term for the original purchase price plus accrued by unpaid funding costs. The repo has a nine-month term which may be extended by mutual agreement. The funding cost is three-month Libor plus 3.35%, which may be adjusted if the repo term is extended.

Risk transfer expansion
Freddie Mac has expanded its ACIS programme with a new front-end credit risk transfer offering. ACIS Forward Risk Mitigation (AFRM) allows the GSE to transfer up to US$650m of credit risk on US$21bn UPB of single-family mortgages simultaneously with the acquisition of the loans by securing committed private capital and providing stable pricing over a two-year horizon through end-2019. The covered pool comprises 30-year fixed-rate loans with LTV ratios of 60%-97%.

Settlements
RBS last month agreed a US$125m settlement with California Attorney General Xavier Becerra over misrepresentations about RMBS sold to California's public employee and teacher pension funds, CalPERS and CalSTRS. The RMBS were found to have failed to accurately disclose the true characteristics of many of the underlying mortgages, with due diligence to remove poor quality loans from the investments not adequately performed. RBS was aware of the misrepresentations but failed to correct them, leading to millions in losses to CalPERS and CalSTRS. California has previously clawed back US$150m from Moody's, US$210m from S&P, US$300m from Bank of America, US$102m from Citigroup and US$300m from JPMorgan.

PHH Mortgage Corp has entered into a settlement agreement and consent orders with the Multi-State Mortgage Committee and State Attorneys General in connection with findings related to legacy mortgage servicing activities occurring between 1 January 2009 and 31 December 2012 that were subject to a multi-state mortgage loan servicing examination. Under the terms of the settlement, PHH will pay approximately US$45m in aggregate, adopt negotiated servicing standards and implement a testing and reporting process to ensure compliance with these standards for a period of three years.