Sector developments and company hires

CMBS value deficiencies compared
DBRS Morningstar has identified US$9.79bn in US CMBS loans transferred to special servicing since March, whose collateral was subsequently reappraised. Although updated appraisals on properties backing these loans suggest an average value decline of 24% since origination, only about 17% have a loan-to-value ratio of 100% or higher, resulting in a value deficiency. The analysis also found that just US$372m - or 3.8% of the outstanding principal balance - had a value deficiency, which compares favourably with the 9.5% loss rate on loans issued in the run-up to the financial crisis.

In other news…

CLO approach adjusted
Moody's has adjusted its approach to assessing the default probabilities ratings of obligors included in CLOs; in particular, the analytical treatment of corporate obligors with a negative outlook or whose ratings are on review for downgrade. The update is expected to result in a generally positive impact on ratings, largely comprising reviews for possible upgrade and single-notch upgrades, totalling around 5% of the agency’s approximately 7,000 outstanding rated CLO tranches in the US and EMEA.

IBA consultation published
ICE Benchmark Administration (IBA) published its consultation on its intention to cease the publication of Libor settings (SCI 1 December). The consultation is open for feedback until 25 January 2021, after which IBA intends to share the results of the consultation with the UK FCA and to publish a feedback statement summarising responses from the consultation shortly thereafter.

North America
Intertrust Group has promoted Shankar Iyer to ceo, having previously been chief solutions officer at the firm. Prior to that, Iyer was ceo and co-founder of Viteos, which Intertrust acquired in 2019. He has over 30 years of international experience in scaling businesses and in integrating digital capabilities, including as president and ceo of Silverline Technologies.