Sector developments and company hires

RFC on NPL ABS treatment
The Basel Committee has published a technical amendment in connection with the capital treatment of non-performing loan securitisations. This proposal, which the Committee started developing before the onset of the Covid-19 pandemic, addresses a gap in the regulatory framework and sets out a prudent treatment for NPL ABS. The technical amendment establishes a 100% risk weight for certain senior tranches of NPL securitisations. The risk weight applicable to the other positions are determined by the existing hierarchy of approaches, in conjunction with a 100% risk weight floor and a ban on the use of certain inputs for capital requirements. Feedback on the proposal should be submitted by 23 August.

In other news…

Acquisitions
Clearlake Capital Group has acquired a majority stake in WhiteStar Asset Management from Pine Brook Capital Partners, in partnership with WhiteStar's management team, led by ceo Gibran Mahmud. The Clearlake and WhiteStar combined assets under management are now approximately US$24bn. Over the last three years, WhiteStar increased its AUM from US$1.5bn to approximately US$6bn and completed seven new CLOs under the Trinitas programme, marking 12 CLOs since inception of the platform. WhiteStar plans to expand its combined credit platform, including CLOs, CLO investing, credit opportunities and new product offerings.

Clifford Capital Holdings (CCH) has acquired a 50% stake in Pierfront Capital Fund Management, the manager of Pierfront Capital Mezzanine Fund (PCMF) and the Keppel Pierfront Private Credit Fund (Fund II). Along with its acquisition of 50% of Pierfront Capital, CCH has acquired PCMF’s interest in Fund II. In 2016 Clifford Capital led the conceptualisation and establishment of PCMF, which is owned by two of CCH’s shareholders (Temasek Holdings and SMBC), and CCPL provided back- and middle-office services to PCMF up to 30 March 2020 (when this function was transferred to CCH’s Management Services entity). The transaction follows the completion of KC Management One’s 50% acquisition in Pierfront Capital and the first close of Fund II on 30 March 2020. The acquisition of Pierfront Capital will allow CCH to expand its business capabilities to include private credit and mezzanine financing solutions.

North America
Lockton Capital Markets has appointed Richard Pan as md, working closely with ceo Ken Pierce to grow the firm’s structured finance practice. Prior to joining Lockton, Pan worked in investment management for Waterfall Asset Management, where he structured, negotiated and managed investments across various sectors, including insurance/reinsurance, litigation finance, transportation, small business, unsecured consumer lending and residential and commercial mortgages. Before that, he was lead counsel for the asset-backed products desk at Société Générale.