Sector developments and company hires

New IMA inked
Pollen Street Secured Lending (PSSL) has appointed Waterfall Asset Management as its investment manager, replacing PSC. An investment management agreement has also been signed with a new AIFM, Mirabella Financial Services. PSSL has agreed to pay PSC a sum representing the approximate balance of the unpaid base management fee, including the unexpired notice period. The PSSL board believes that Waterfall's appointment materially increases the likelihood that a firm all cash offer will be introduced for shareholders to consider. If a recommendable offer is not forthcoming, the board is likely to recommend to shareholders that the company pursues an orderly run-off, with capital to be returned to shareholders in as timely a manner as possible during the process.

In other news…

EMEA
Ashurst has appointed Douglas Murning as partner in the global loans practice in London. He joins from DLA Piper, where he was partner. Murning will focus on complex event-driven finance transactions, including leveraged and corporate acquisition finance, credit fund, special situation and fund-related financings and the restructuring of complex debt arrangements.

Forbearance hits SLABS ratings
Moody's has downgraded six securities and confirmed two others issued by eight FFELP student loan ABS, affecting approximately US$2.6bn of notes. The securitisations impacted by downgrades are: Academic Loan Funding Trust 2012-1 class A2 (downgraded to Aa1 from Aaa); Navient Student Loan Trust 2014-1 class A3 (downgraded to A3 from A2); Navient Student Loan Trust 2015-1 class A2 (downgraded to Aa1 from Aaa); Nelnet Student Loan Trust 2007-1 class A4 (downgraded to A3 from A1); SLM Student Loan Trust 2005-4 class A4 (downgraded to Aa1 from Aaa); and SLM Student Loan Trust 2010-2 class A (downgraded to A2 from A1). The affirmed notes are Access Group Series 2007-1 class A4 and SLC Student Loan Trust 2007-2 class A3. The rating actions reflect Moody’s revised expectations on performance, driven by increased forbearance as a result of a slowdown in economic activity and an increase in unemployment due to the coronavirus outbreak.

“Due to significant increases in forbearance, certain transactions are subject to slower collateral pool amortisation and subsequently bond payoff risk by their legal final maturity dates. The peak forbearance level in these pools ranged between 18% and 34% in 2Q20 and the forbearance level of some pools has subsequently reduced to between 11% and 21% during Q3,” the agency notes.