Talking Point

  • Covid-19: Lessons for the CMBS market

    Iona Misheva, partner at Allen & Overy, explores the lessons that the pandemic provided for the European CMBS market

    Issuance has been at consistently high levels this year.  This has shown that the asset class recovered quickly from the temporary forces of the pandemic, which resulted in very few deals coming to market in 2020.  In contrast, 2021 has seen near record levels of .......

    Talking Point 6 December 2021

  • SRT chronicle: part three

    In the final instalment of a three-part series on bank risk...

    We have seen in part one of this series how far the SRT sector has developed in the past 10 years from a niche market with 10-12 transactions issued a year to a much larger and more diversified market. Barring a material downturn in the credit cycle, the SRT market should continue to enjoy strong growth in the next .......

    Talking Point 2 December 2021

  • SCI forum: What are the benefits of forward flow structures for the securitisation market?

    Our panel of market practitioners respond to readers' questions

    Conor Houlihan, partner at DLA Piper, Ireland

    Current dynamics in the banking sector are such that the opportunity for growth in non-bank lending in Europe is significant.  In certain segments of the market, fintech lending platforms can be more agile and better-placed to deliver what the market wants. 

    Platforms with strong origination and underwriting capability can be an attractive partner through .......

    Talking Point 26 November 2021

  • SRT chronicle: part two

    In the second of a three-part series on bank risk transfer t...

    The SRT market is predominantly European (representing 86% of transactions since 2010), although US banks are accounting for an increasing percentage since 2019 - with JPMorgan now a regular issuer, one transaction by Goldman Sachs in 2020 and a few regional banks entering the market in 2021. Prior to 2019, only Citi and Bank of Montreal were regular issuers in .......

    Talking Point 25 November 2021

  • The lessons of history

    STACR founder Don Layton talks the early and current days of the market

    In the latest Freddie Mac podcast former ceo Don Layton describes the birth of the CRT market and says that following the launch of the first STACR deal in early 2013 he was instructed by the FHFA to share the secret recipe with Fannie Mae.

    “Interestingly, we were then told to take our documents and give them to Fannie .......

    Talking Point 19 November 2021

  • SRT chronicle: part one

    In the first of a three-part series on bank risk transfer tr...

    The bank balance sheet securitisation market has enjoyed significant growth over the past five years and looks set to continue apace on the back of clearer regulation, an increasing number of banks having acquired the technology and economic incentives for banks to free up risk-weighted assets (RWAs) rather than raising capital. In this series of articles, we will use significant .......

    Talking Point 18 November 2021

  • Indian securitisation market presents challenges

    The Indian structured finance market has been around for ove...

    The market revolves around Indian banks' targets for lending to priority sectors. Banks have traditionally been the largest investors in securitised debt, as they need to fulfil the Indian central bank’s requirements to lend a target percentage of their loan books to priority sectors, which are defined by the central bank and include minorities, agriculture, SMEs and export industries. The .......

    Talking Point 11 November 2021

  • Future-proofing credit portfolio management

    John Pellew, principal, distribution and securitisation, Arr...

    It has become a bit of a cliché to say that technology, data, analytics – and importantly – the appropriate application of such tools has become fundamental to running a successful business. And yet, despite the regularity with which the topic is discussed, how precisely this applies to the distressed loans market has not been fully appreciated. 

    For .......

    Talking Point 26 October 2021

  • Beyond Covid-19: What effect has the pandemic had on the European RMBS and mortgage markets?

    Andrew South, md, structured finance and Alastair Bigley, se...

    The Covid-19 pandemic has provided a novel test of European RMBS credit performance, which the sector looks set to pass with flying colors. As virus-related social restrictions led to an economic shutdown and mortgage lenders introduced unprecedented borrower forbearance schemes, RMBS investors seemed to be at risk of taking a hit.

    Mortgage payment holidays posed a potential liquidity .......

    Talking Point 14 October 2021

  • What is the future for US office space?

    Steve Jellinek, head of CMBS research at DBRS Morningstar, e...

    On a national level, the US office market is likely to see a rebound from the coronavirus pandemic-induced recession, even as net absorption has underperformed and construction remains elevated. The amount of sub-leasable space continues to shrink, declines in vacancy were seen in some major metropolitan areas in 2Q21, and office-using employment continues to grow amid the reopening economy.

    Talking Point 5 October 2021

  • Capitalising Mobility-as-a-Service

    SDG Investments partner Stefan Bund and senior structurer To...

    The trade-off between urbanisation, individualisation and sustainability has led to the emergence of new business models around individual and micro-mobility. New mobility providers enter the market and shape the urban landscape with their cars, mopeds, bicycles and scooters.

    To cover the associated capital requirements, they need financing solutions that are as sustainable as the business models themselves. This offers the .......

    Talking Point 4 October 2021

  • Are direct lending strategies fit for purpose?

    Contributed thought leadership by Ocorian

    Ocorian's Global Head of Capital Markets Alan Booth draws on the firm’s global survey of capital markets decision-makers to shed light on why a staggering 87% of firms surveyed have a direct lending strategy in place. He also explains how these firms can overcome operational challenges by optimising their approach to administration.

    Our research found that the majority (57%) of .......

    Talking Point 26 July 2021

  • Social factors

    Tina De Baere, head of ESG and macro strategy at Cairn Capit...

    Q: How consistent can ESG issues be? Ultimately, how subjective is ESG and ESG analysis?
    A: Yes, this is a question that comes up all the time. ESG topics will always be subjective; it is the nature of the beast in many ways.

    Given that there are so many values and opinions on those topics, it would be unreasonable .......

    Talking Point 20 July 2021

  • Private debt investors doubt ability to handle defaults in post-pandemic downturn

    Contributed thought leadership by Ocorian

    An overwhelming majority (87%) of capital markets investors are pursuing direct lending strategies, though almost half (47%) lack confidence in their ability to manage loss recoveries, which could have serious implications if corporate defaults rise as pandemic-driven government support schemes are withdrawn. This is according to a new Ocorian report, entitled ‘Navigating CovExit: searching for value in the debt markets’, which .......

    Talking Point 1 June 2021

  • Actuarial approach

    Alphidem co-founder Ken Sutter outlines how the quantitative...

    In light of the current regulatory and interest rate environment, it could be assumed that capital relief trades enjoy great popularity, even outside of the dedicated investor community. However, despite growth and positive market trends, the asset class still leads a niche existence and sticks to its esoteric label. This is even more astonishing considering that many alternative credit managers .......

    Talking Point 25 May 2021

  • Balancing act

    Alexander Batchvarov, md, head of international structured f...

    Q: How would you describe European investor appetite for esoteric securitisations currently?
    A: We have a situation on the market, where corporate spreads are moving very tight and at present high yield spreads are in the 300bp area in Europe. Investors seek beta, but also keep an eye over their shoulders – ECB reaction function is of concern. 

    With .......

    Talking Point 30 April 2021

  • Climate concerns

    KBRA md Peter Giacone and Nephila Climate structured finance...

    PG: How does the insurance industry fit into the ESG discussion and where do you see touch points within the Nephila Climate universe?
    AW: The evaluation of climate risk, a key aspect of the ‘Environmental’ factor, is a core capacity and it is what we do every day. In terms of the ‘Social’ element, the obvious thing is that insurance .......

    Talking Point 22 April 2021

  • A turning point for investors

    KopenTech looks at US CLO trading trends in 2020 and their likely future impact

    In a period defined by a pandemic, social turmoil and an election, CLO investors increased their use of electronic trading to engage in a more efficient exchange of securities.

    With this increase in volume came an increase in data.  We highlight some of the US CLO market trends, including how increases in trading volumes have been handled by investors, and expectations for .......

    Talking Point 31 March 2021

  • Fly or goodbye - can airlines survive without taking to the skies?

    Contributed thought leadership by Ocorian

    As once profitable airlines look to survive and raise liquidity to weather the turbulence of the Covid-19 pandemic, Ocorian director Abigail Holladay and Watson Farley & Williams aviation partner Patrick Moore assess the use of alternative assets as a means to raise finance.

    With airlines having lost an estimated US$118.5bn in 2020, it's easy to forget the aviation industry had been .......

    Talking Point 8 February 2021

  • CRT super spreader

    Asset manager ArrowMark, a long-time investor in CRT, sees increased US usage

    Despite the constraints imposed by Covid 19, this has been a banner year for the CRT market in the US, with headline-making deals from JP Morgan and Goldman Sachs while Citigroup, a longstanding user of the mechanism, has been rumbling along below the radar screen.

    Kaelyn Abrell, a partner and portfolio manager at ArrowMark Partners, a $20bn asset manager based in Denver, .......

    Talking Point 15 December 2020

  • Leveraged finance: stepping into the void

    Contributed thought leadership by Ocorian

    As funds continue to reallocate capital to direct lending strategies, Sinead McIntosh, business development director at Ocorian, a global leader in corporate and fiduciary services, fund administration and capital markets, highlights the crucial role of independent loan service providers in streamlining fund loan portfolios

    In a continuation of the legacy of the 2007-2008 global financial crisis, large commercial banks .......

    Talking Point 7 December 2020

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