Sector developments and company hires

CMBS environmental risk score rolled out
Trepp has implemented a new data integration with Risk Management Solutions (RMS) that aims to help evaluate and manage global risk from natural and man-made catastrophes. The solution provides an environmental risk score for properties backing CMBS loans, ranging from one to five, that measure the likelihood of property damage and business interruption from earthquakes, flooding, wildfires, hurricanes, tornadoes, hail, winter storms and thunderstorms.

Using RMS property loss and business interruption data, Trepp has identified the geographic distribution of risks across properties backing CMBS loans. California tops the list in terms of the number of high-risk properties. Other major states with large counts are those near low-lying or coastal areas with histories of large hurricanes or environmental events. Accordingly, Florida, Texas and Louisiana round out the top four.

In other news…

Acquisition
Sun Life Financial intends to acquire a 51% interest in Crescent Capital Group for up to US$338m, consisting of an upfront payment of US$276m and a future payment of up to US$62m based on the achievement of certain milestones. The transaction is expected to close in late 2020.

Crescent’s equity holders will retain carried interests in existing funds, along with certain assets. The transaction has a put/call option, which will allow the transfer of remaining interests approximately five years from closing.

Crescent will operate independently under its current leadership.

AMR CLOs tallied
HalseyPoint CLO 3, which priced on 21 October, marks the tenth US CLO with AMR language printed to date. So far, over US$4.4bn of CLOs have closed with AMR language, according to KopenTech.

Fallbacks supplement, protocol launched
ISDA has launched the IBOR Fallbacks Supplement and IBOR Fallbacks Protocol, with the aim of reducing the systemic impact of the benchmark becoming unavailable while market participants continue to have exposure to that rate. The supplement will amend ISDA’s standard definitions for interest rate derivatives to incorporate robust fallbacks for derivatives linked to certain IBORs, with the changes coming into effect on 25 January 2021. From that date, all new cleared and non-cleared derivatives that reference the definitions will include the fallbacks.

The protocol will enable market participants to incorporate the revisions into their legacy non-cleared derivatives trades with other counterparties that choose to adhere to the protocol. The protocol is open for adherence from today (23 October) and will become effective on the same date as the supplement. At launch, 257 derivatives market participants had adhered to the protocol during the two-week pre-launch ‘escrow period’.

North America
Alcentra has appointed Chris Mulshine as head of US distribution and to its executive management committee. He will be based in New York and report to Dan Fabian, president and coo. Mulshine will define the company's long-term sales and marketing strategies in North America and lead the institutional business activities across all client segments in the US. He joins from the Lazard Private Capital Advisory team, where he was global head of private credit.

Spanish SME deal closed
The EIB has joined forces with the Instituto de Crédito Oficial (ICO) and PSA Financial Services Spain to support Spanish SMEs and mid-caps affected by the coronavirus crisis. To this end, the EIB and ICO have subscribed to several tranches of a securitisation originated by PSA Finance - dubbed Auto ABS Spanish Loans 2020-1 - accounting for €250m and €100m respectively. The EIB is carrying out this operation as part of the initiatives it launched in March as a rapid response to the crisis caused by the pandemic.