Sector developments and company hires

Franklin Templeton is set to acquire the European credit and private debt manager, Alcentra, from BNY Mellon. The acquisition of Alcentra and its US$38bn in assets under management will see the expansion of Franklin Templeton’s US alternative credit specialist investment manager, Benefit Street Partners, and ramping up of its presence and capabilities in Europe. The transaction will increase the size of Franklin Templeton’s alternative assets under management to US$257bn, and double Benefit Street Partners’ assets under management to US$77bn. Alcentra and BNY Mellon will maintain existing distribution and asset servicing relationship, with the transaction expected to complete during 1Q23.

In other news…

APAC

Blackstone Credit (BXC) has appointed a new head of Asia Pacific origination, in a bid to expand its presence in the region and support rising demand for private credit financing. Mark Glengarry joins the BXC team from Anchorage Global Capital, where he served as md for the London and Sydney offices, managing private investments across Europe and Asia Pacific. Glengarry will be based in Sydney, and the BXC APAC team will be led by head of Blackstone Credit’s European business, Paulo Eapen.

EMEA

ARA Venn has named Charles-Edouard Pouyet director and head of capital markets, residential mortgages. Based in London, he was previously svp, capital markets at Kensington Mortgages and a vp in credit derivatives structuring at Societe Generale. In his new role, Pouyet is tasked with expanding the firm’s investment management capabilities into new mortgage products and markets.

GSE disclosure requirements introduced

The US FHFA has published a final rule that amends the GSE Enterprise Regulatory Capital Framework (ERCF) by introducing new public disclosure requirements for Fannie Mae and Freddie Mac. The requirements include quarterly quantitative and annual qualitative disclosures related to risk management, corporate governance, capital structure, and capital requirements and buffers under the standardised approach. The aim is to enable market participants to assess key information about the enterprises’ risk profiles and associated levels of capital, and thereby promote transparency and encourage sound risk management practices at the enterprises. The GSEs will publish their first public disclosure reports under the final rule in 1Q23.  

Lending partner revealed

Digital-lending platform auxmoney has disclosed that it partnered with Chenavari Investment Managers, for the first time, to issue its latest securitisation. Dubbed Fortuna Consumer Loan ABS 2022-1, the €225m transaction represents the largest public consumer ABS to be issued by a fintech so far this year (see SCI’s Euro ABS/MBS Deal Tracker). The triple-A rated class A notes adhere to the standards defined in the ICMA Social Bond Principles, as confirmed by an ISS Corporate Solutions second party opinion. The transaction is also certified by SVI as a securitisation meeting the requirements for STS.

North America

Churchill Asset Management has hired a new head of sustainability and ESG integration, Mickey Weatherston. He joins the firm as principal and will be based in New York City, reporting to cro, Christopher Cox. Weatherston will be responsible for offering strategic direction for ESG integration across Churchill’s businesses, working alongside parent company Nuveen’s responsible investing team. Weatherston joins with more than 18 years of experience from Muzinich, where he served as director of marketing and client services.

DBRS Morningstar has announced the hire of 10 new senior-level analysts to its global structured finance team in New York and Chicago. Five new members will join the firm’s US structured credit group, including Hylton Heard, Stuart Rothenberg, and Lisa Kwasnowski as senior vps, and David Petu, and John Um as vps. These five will report to md and head of US structured credit, Jerry van Koolbergen. Additionally, Elizabeth Fitzpatrick, Doo-Sik Nam, and Du Trieu will join the DBRS Morningstar US ABS group as senior vps, reporting to md and head of US ABS, Chris D’Onofrio. The new hires join recently recruited Michael Vidmar and Patrick McCormick, who now serve as vps for DBRS Morningstar’s North American CMBS group and operational risk group, respectively.

Post-moratorium arrears volatility eyed

DBRS Morningstar reports that prepayment levels across its European structured finance rated universe have remained stable for RMBS, on a slightly increasing trend for ABS - especially auto loans in Germany and the UK - and on a similarly increasing trend for SME CLOs. Performance has continued to remain solid as pandemic-induced payment holidays in most jurisdictions have not rolled into arrears, although the rating agency observes an increasing trend in 90 plus-day arrears in the UK. There appears to be no clear correlation between payment holidays and prepayments, however.

These findings are from a DBRS Morningstar analysis of coronavirus-related payment holiday data for 275 RMBS, ABS and structured credit transactions it rates across eight jurisdictions. The majority of the data is from Italy (accounting for 81 transactions), Spain (77) and the UK (49). The remaining data is from Ireland (20), Germany (11), the Netherlands (17), Portugal (11), France (6) and Belgium (2). Overall, only 47 out of the 275 transactions still reported payment holidays in 1Q22.