Sector developments and company hires

30-year CIRT debuts

Fannie Mae has completed its sixth Credit Insurance Risk Transfer transaction of 2019: CIRT 2019-3 covers US$14.8bn in unpaid principal balance of 21- to 30-year original term fixed-rate loans. The deal marks the first time a 30-year bulk CIRT transaction was structured with an extended policy term of 12.5 years and a 40bp retention layer, compared to a 10-year policy term and a retention layer of between 50bp-60bp for similar past deals. These changes in the structure increased the risk transfer on the covered pool of loans. With 21 insurers and reinsurers providing coverage, demand for this transaction was among the strongest the GSE has ever had.

CLO firm makes senior appointment

Churchill Asset Management has appointed Joe Cambareri, as md and chief accounting officer, effective 23 September 2019. Cambareri is responsible for the day-to-day management of Churchill’s finance and accounting function and reports directly to cfo, Shai Vichness. Cambareri brings over 20 years of finance, accounting, operations, reporting and tax experience to Churchill, related to a variety of direct lending funds, separately managed accounts, collateralized loan obligations and public and private business development companies. Prior to joining Churchill, Cambareri served as cfo for nine years at Greenwich, CT-based Credit Value Partners, a credit-focused asset manager owned by New York Life.

Co-founder to retire

Highland Capital Management co-founder Mark Okada is retiring from the firm, stepping down from his full-time role at end-2019. He will assume a senior advisory role through the end of the year to support transition activities and will retain his ownership stake, following his retirement. Highland president James Dondero - who founded the firm with Okada - will continue to oversee the management of Highland and all affiliated businesses, taking over as co-cio following Okada's retirement. Okada has already transitioned a number of responsibilities in recent years to senior leadership on the credit research and structured products teams, as well as to co-cio Joe Sowin, who oversees day-to-day investment activities across the Highland platform.

CRE firm makes raft of hires

Sabal Capital Partners has made hire four executives to its CRE lending team, in the form of William Sampson, head of CRE securitisation, New York and he was previously executive director of Morgan Stanley’s EMEA CRE credit group, as well as executive director and head of securitization underwriting for Morgan Stanley’s CMBS group. Sabal has also hired Allison Toy as head of CRE underwriting, New York, having most recently served as director of CRE capital markets and finance for Wells Fargo Securities.

Additionally the firm has hired Brandon Goldschmidt as director CRE originations (LA), having most recently been at Ladder Capital Finance (Situs) in Los Angeles, supporting the underwriting and closing process of more than $300 million of CMBS and balance sheet bridge loans. Finally, Sabal has hired Kurt Clauss as an associate (New York) and most recently served as associate director in Cushman & Wakefield’s commercial real estate valuation and advisory group.

Forever 21 exposure eyed

Moody’s notes that store closures as a result of Forever 21’s recent bankruptcy filing could negatively impact US CMBS loans with large exposure to the tenant, particularly among properties that have seen other recent tenant departures. Of 150 loans secured by retail properties with exposure to Forever 21 in deals the agency rates, the tenant represents more than 10% of the collateral square-footage at only seven properties, for an aggregate allocated loan balance of US$814m. Furthermore, at 14 of the properties (across 28 loans), Forever 21 had a footprint greater than the company’s average store size of 38,000 square-feet.

ILN debut

Tullett Prebon, part of TP ICAP, has successfully settled of the first Insurance Linked Notes (ILN) transaction following onboarding of the first group of clients to its newly launched ILN platform. The new ILN initiative is spearheaded by Tullett Prebon’s ILS desk, which was formed in 2008 and is a leading broker in catastrophe bond secondary trading worldwide. ILNs are fully collateralized, securitized, listed and tradable instruments. They are Industry Loss based instruments, similar, to Industry Loss Warranties, but designed to provide clients with a more cost efficient method of protecting, investing in and hedging catastrophe risk.

Software acquisition announced

Moody’s has acquired Deloitte’s ABS Suite, a software platform used by issuers and trustees for the administration of asset-backed and mortgage-backed securities programs. The ABS Suite product and personnel will join Moody’s Analytics’ Structured Solutions business, which provides research, data and analytical tools to participants on all sides of the market for structured finance transactions. ABS Suite complements Moody’s Ki platform, the next-generation version of Moody’s ABS System. The terms of the transaction were not disclosed, and it will not have a material impact on Moody’s 2019 financial results. The transaction was funded with cash on hand.