Another Fine Mezz: Recent Episodes
Gerald Hayes
A podcast about the global securitization markets from GlobalCapital where we speak to senior industry figures about what is happening in the world of asset backed securities
Muzinich launches CLO ETF, Rothesay’s huge refinancing, and why Europe should worry about AI
Bank of America securitises more Santander mortgages, the loan market is back above par, and Another Fine Mezz Live in Barcelona!
Credit quality diverges between CLOs and private credit, UK auto ABS thrives but FCA redress scheme hits Blue Motor Finance
PGIM’s managing director joins AFM to discuss the UK and EU securitization regulatory roadmap
CLO managers struggle with ramps, Stellantis returns to UK auto ABS with E-Carat shelf as ABS spreads tighten again
More AI worries for CLOs, PremFina’s funding boost, Advanzia kick starts ABS market
In collaboration with TMF, our headline awards sponsor, GlobalCapital is running a survey on the trade finance market. It’s nine questions only and can be completed via this link.
An interview with Propel and the BBB, a busy Q1 for ABS, more arb headaches for CLO managers
The fallout of MFS entering administration, how Iran war is affecting the market and CLO managers’ software headache
Vervent explains how Tricolor warehouse and ABS deal servicing work.
David Johnson, chief executive of Vervent, joined Another Fine Mezz at the SF Vegas conference to talk about its work keeping cash collection going following the bankruptcy of Texas-based sub-prime auto lender Tricolor last September.
Johnson told senior securitization reporter Chadwick Van Estrop that at the time of the bankruptcy filing, about 10,000 cars, some pledged as collateral against warehouse or ABS lines of credit, were found in Tricolor’s possession across dealerships, workshops, storage lots and auction houses.
All those cars have now been sold, and the associated funds are in Tricolor’s accounts, according to Johnson.
How those funds are distributed will be determined by a Texas bankruptcy judge, the bankruptcy trustee and a court case in the Southern District of New York, where founder and CEO of Tricolor, Daniel Chu, and three other executives were charged with “systematically defrauding Tricolor’s lenders”.
In the weeks after the bankruptcy filing, the trustee overseeing the process went to a Texas court seeking access to about 100,000 loans reportedly originated by Tricolor.
But Johnson told GlobalCapital that the actual number of loans Vervent found and brought into its systems during its servicing work was about 70,000.
The difference is where allegations of double pledging of loans have been made.
Johnson said the Tricolor Chapter 7 bankruptcy was the “largest in history” and the subsequent document sampling to test the strength of a securitization collateral pools have risen from as low as 10%, in some cases, to about 100%.
The executive touched on why Vervent hired 26 of Tricolor’s back office staff, and about 150 call center workers in Mexico, after the bankruptcy filing, and the moves made to keep money flowing into the company that could be made available to warehouse and ABS lenders.
Podcast outline
- 0-6 minutes: systems to prevent double pledging of assets
- 6-14 minutes: Vervent’s servicing work for Tricolor to now
- 14-19 minutes: the future of Vervent’s servicing for Tricolor
GlobalCapital’s reporting on the Tricolor fiasco
- Tricolor collection accounts believed to hold $100m
- Probe to confirm if Tricolor auto loans canceled when cars repossessed
- Back-up servicer moves in on Tricolor's delinquent-heavy auto ABS
- Tricolor auto loan fiasco puts ABS practices on trial
The fall of Market Financial Solutions and Ares’ second private credit CLO
A spokesperson for Market Financial Solutions told GlobalCapital last week that the firm's founder Paresh Raja “categorically denies any allegations of fraud”.
Adam Reeds joins Another Fine Mezz to discuss pioneering deal
On the back of pricing the first ever Bitcoin loan asset-backed securitization last month, Ledn co-founder and CEO Adam Reeds sat down with GlobalCapital’s senior reporter Chadwick Van Estrop at SF Vegas to talk about the deal and the outlook for the company in the ABS market.
Reeds revealed Ledn’s next ABS deal could come as soon as six months from now if originations reach a critical mass.
In the interview he responded to market concerns about the custody of the Bitcoin that backs the ABS.
Reeds also touched on Ledn’s outlook for refinancing the ABS deal before the end of the three-year revolving period. “It very much will be dependent on other types of capital available three years from now,” he explains. “As it stands, currently, I can see us refinancing and keeping this going in perpetuity.”
Reeds touched on why he viewed Ledn’s speed of liquidation as a strength for its ABS and revealed that Ledn’s borrowers are not mandated to pay their loans back down to a 50% loan-to-value ratio if the LTVs rise above 70% and 75% as the price of Bitcoin falls.
With about one third market share of the Bitcoin-backed consumer lending sector, Ledn plans to double its loan book this year. Last year it originated $100m to $150m of Bitcoin-backed loans a month with about $1bn of loan principal and interest outstanding at year end. Reeds explains why Ledn is confident about achieving this.
Podcast outline:
0-12mins: Ledn’s business model and Bitcoin backed lending
12-24mins: ABS deal details
24-29 mins: Future of the ABS platform
UK regulations take shape, software slide tests CLO managers’ mettle and how captive equity is distorting the market
A new European data centre sponsor, Dutch buy-to-let back in business, CLO equity squeezed and a bitcoin backed deal
Thomas Hopkins discuss whether private credit and BSL CLOs are really adversarial as often thought while Tom Hall gets his teeth in a tasty Pepper trade
Thomas Hopkins discusses a vintage of CLOs being refinanced rather than reset, while Tom Hall talks about whether CMBS investors can share with banks
Tom Hall goes through a sterling week of deals for European ABS, while Thomas Hopkins dissects the dangers that a rise in LMEs would pose for European CLOs.
This the last week to vote for your winners of GlobalCapital’s 2026 European Securitization Awards! View the shortlist and vote here by January 23.
George Smith gets the outlook for prime RMBS from Tom Hall and CLO resets from Tom Hopkins, as familiar shelf returns to its usual spot in the calendar
George Smith talks to Tom Hall about an equity release double debut RMBS and the rise of the Australian securitization market
George Smith and Tom Hall talk through Enpal’s second deal, the UK’s bank capital tweaks and why there isn’t more M&A in the specialist lender market
This week Tom Hall and Thomas Hopkins discuss how Enpal's return heated up the ABS market and take the CLO equity market's temperature
George Smith talks to Tom Hall about a run of giant ABS deals, and to Thomas Hopkins about whether changes to Solvency II will bring insurers flocking back to securitization.
George Smith talks to Thomas Hopkins about hedging in private credit CLOs, before Tom Hall discusses Cerberus’ bridging breakthrough
George Smith talks to Thomas Hopkins about what S&P’s France downgrade means for CLOs and sterling ABS issuers’ enthusiasm for prefunding
Waterfall's forward flow advantages, UK auto ABS resumes and CLO managers tackle a bifurcated leveraged loan market
George Smith talks to Tom Hall about a wobble in the sterling ABS market and to Tom Hopkins about some signs of widening in CLO mezz
Tom Hall talks to George Smith about mortgage tokenisation and Thomas Hopkins about a bifurcation in the leverage loan market and a breakthrough deal in UK RMBS
Thomas Hopkins, GlobalCapital’s new CLO reporter, makes his debut on the pod discussing a wave of CLO resets with Tom Hall
George Smith talks to Tom Hall about an exciting deal in the pipeline, SME financing and supply from Santander
George Smith talks to Tom Hall about tight spreads in the European ABS market and KKR's blockbuster acquisition of NewDay's credit card book.
Tom Hall talks to George Smith about the lively and Santander-dominated European ABS primary market, before discussing the bankruptcy of US ABS issuer Tricolor with Chad Van Estrop
George Smith and Tom Hall discuss the return of UK auto ABS and the serene progress of the other deals in the public markets
George Smith and Tom Hall discuss why CLO and loan prices are out of sync and some troubles for CMBS, before a chat with US MBS reporter Nick Conforti on an unusual floating rate US MBS tranche
In a regulation heavy episode of Another Fine Mezz, George Smith and Tom Hall discuss the FCA’s decision to regulate Buy Now, Pay Later and the EU’s proposed changes to Solvency II
George Smith and Tom Hall discuss a flood of CLOs, a trickle of ABS, the UK's new bank capital rules and why banks are more interested in forward flows
George Smith and Tom Hall discuss the thriving Polish securitization market, developments in the Italian NPL market and take a trip down memory lane
George Smith and Tom Hall discuss a landmark wine and spirits deal, busy public markets and a couple of football stadium financings
George Smith and Tom Hall discuss a pair of CMBS deals and whether you can trade an SRT
George Smith and Tom Hall break down everything you need to know about the European Commission's proposals on capital requirements, LCR and securitization regulation
Morningstar DBRS's Christian Aufsatz joins usual duo George Smith and Tom Hall to review the year so far and preview the Global ABS conference in Barcelona next week in a sponsored episode of Another Fine Mezz
George Smith is joined by VanEck's Fran Rodilosso and Bill Sokol to discuss how CLO ETFs weathered the tariff induced volatility in April, before the usual discussion of a busy week with Tom Hall.
George Smith and Tom Hall preview a packed road to Barcelona for ABS primary as deal activity picks up across all asset classes.
George Smith and Tom Hall discuss whether Vantage's latest deal is setting the stage for more action in data centre ABS and the return of an well known UK RMBS issuer, albeit with a bit of a new look
There are several encouraging signs in the European ABS primary market for GlobalCapital's George Smith and Tom Hall to discuss this week.
George Smith is joined by US securitization editor Oliver West to discuss a rare reperforming RMBS from Balbec and the pick up in public markets activity this week
George Smith and Tom Hall discuss whether ABS and CLO issuers are managing to take advantage of period of calmer macro conditions and how to securitise sun light
ABS primary slows down, but George Smith and Tom Hall discuss one issuer bucking the trend and whether secondary selling has been orderly
George Smith and Tom Hall discuss whether the tariffs chaos will derail the European ABS market and how the ESA report left the CLO market scrambling
Senior securitization reporter George Smith and reporter Tom Hall focus on deal activity in the European ABS this week, with a short trip to the Middle East.
George Smith and Tom Hall discuss all the action in a European securitization primary market that is becoming a little more adventurous across all sectors.
Covered bond editor Frank Jackman joins George Smith to discuss Paragon’s innovative buy-to-let covered bond, before George and regular podcaster Tom Hall discuss the prospects for UK bridging RMBS, Italian ABS pricing and capital treatment of subscription lines
George Smith and Tom Hall discuss the recent run of ABS debuts, the ECB's plans to fast-track SRT approvals and bumper CLO fundraising
George Smith and Tom Hall discuss why ESMA’s consultation misses the mark, how another sponsors boosts CMBS, and whether euro CLO spreads are about to hit their floor
Mudasar Chaudhry, head of European structured finance research at Morningstar DBRS, discusses the market outlook with our reporters George Smith and Tom Hall.
George Smith is joined by Diana Bravo and Nick Conforti to discuss the state of data centre financing in the US, while Europe's securitization market keeps ticking over.
George Smith and Tom Hall discuss the return of the European CMBS market, how to boost SME financing and why banks are restricting SRT investors use of leverage.
George Smith and Oliver West discuss why asset managers snapped up Santander's Holmes, how Toyota and VW attracted big books despite differing disclosure on ESG.
First up our new hire, Tom Hall, gets into the weeds of what to expect in UK prime RMBS this year. Meanwhile, George Smith gets stuck into the surge of CLO ETFs in Europe and whether their impact will match up to how they have change the market in America.
Tom is making his Another Fine Mezz debut this week, to cap a flying start to life at GlobalCapital. There’s lots more to come from both of Tom and George, so connect with Tom on LinkedIn or send him an email and get him to buy you a coffee.
European ABS reporter George Smith and freelance CLO reporter Victoria Thiele discuss whether 2025 can live up to a stellar 2024. Both discuss the features they wrote for GlobalCapital’s review of the year (ABS here and CLOs here).
In CLOs, there might be a bit more of an ebb and flow to issuance next year, but expectations are for another strong year of supply, with a quick start in January. The European middle market CLO market could also take off, after Barings priced the first deal earlier this year.
There is a similar optimism in ABS, with new issuers, new asset classes and heavy supply expected. Data centres are one standout area where growth is expected, while bank supply is also likely to continue to increase.
Optimism abounds, but risks do remain particularly because of macro uncertainty. This is the final episode of Another Fine Mezz for the year, but the show will return to cover how 2025 unfolds with regular episodes in January.
For the final episode of the Another Fine Mezz SRT Series, former securitization editor Tom Lemmon was joined by Natascha Winberg, MUFG’s head of financial institutions for Germany, Austria and Switzerland.
They discuss what the next decade will look like for the SRT market, with regulators likely to push for more transparency. The investor base may also continue to grow, particularly as banks use more ESG assets to access impact funds.
Natascha highlights the importance of third party arrangership for smaller issuers and debut issuers, or in deals with more unusual assets, like project finance, infrastructure, CRE or fund finance.
In the second half of the show, they reflect on Natascha’s career so far and discuss how the perception of bankers has changed since the GFC and how to manage the challenges of being a working parent. Finally, for anyone just starting out in the market today, Natascha emphasises the importance of learning, being curious and asking questions.
In the latest installment of GlobalCapital's SRT podcast series, host George Smith was joined by Georgi Stoev and Thomas Lupbrand from the European Investment Fund.
The guests explored the unique role of the EIF in the SRT market, as well as reflecting on their careers to date. The pair discuss how the EIF has been instrumental in expanding the SRT market into new jurisdictions, by leveraging preexisting relationships with issuers.
Georgi and Thomas also explain how, in a time of abundant liquidity, taking a more junior position in the capital structure helps the EIF achieve maximum impact for its money and produces several times more lending than its initial investment.
Finally they discuss how they got into structured finance, what appeals about working at the EIF and the importance maintaining a long term view.
For a special episode of Another Fine Mezz this week, GlobalCapital’s senior securitization reporter George Smith was joined by Dipesh Mehta, Funding Circle’s chief capital officer.
Funding Circle is one of limited number of issuers offering European ABS investors the opportunity to get SME exposure. Of late however, with regulators making the right noises and with more issuers bringing different types of deals online, the SME ABS market is deepening.
Mehta was keen to see that continue, to bring more points of comparison and more liquidity to the market. He also said Funding Circle was keen to keep its public issuance going, with eight deals so far, the latest in May 2024.
In the second half of the show, Mehta reflected on his career so far. He shared his memories of a dramatic moment during the GFC, when the entire Barclays trading fell silent. He also discussed the experience of going through the upheaval of the pandemic working in SME lending.
Another Fine Mezz will be back with more special episodes before Christmas, including more from the SRT series, before the regular weekly episodes resume in January.
GlobalCapital's securitization podcasting trio reunite for one last episode. Former CLO reporter, now freelancer, Victoria Thiele is back on the show, but host Tom Lemmon said goodbye.
George Smith meanwhile remains in post, stoic as ever. He attended DealCatalyst's ABSF conference in London on November 25 and shared his take on the big themes under discussion.
There was also exciting news in the CLO market. Barings won the race for Europe's first middle market deal. Victoria explained the many challenges of getting the deal away.
In ABS, 2024 has produced a bumper crop of ESG issuance. For a sector of the market that has seen a few false dawns, Tom explained why the boost in supply will hopefully be permanent this time.
With a host of special guests dominating the Another Fine Mezz podcast in recent weeks, this week's normal episode with host Tom Lemmon and European ABS reporter, George Smith, felt almost unusual.
As was long-predicted, European securitization markets have been fairly quiet since Donald Trump's second election victory on November 5. However, a ruling by the UK Court of Appeal on motor finance meant there was plenty to chew over.
The ruling found unexpectedly in the favour of the consumer and is broader than first considered by many auto ABS market participants. As a result, it brings into question whether UK auto ABS deals that are still outstanding and upcoming transactions could now be hit by a wave of claims from consumers that they were mis-sold car finance.
There is still so much that's unclear with appeals to the Supreme Court expected, but there are now genuine fears that this could lead to even bigger total compensation than the Payment Protection Insurance (PPI) scandal of the early 2000's. (And therefore, a new decade of no-win-no-fee lawyer adverts).
Meanwhile, George also took a closer look at how UK banks are looking to manage their regulatory capital, particularly their mortgage portfolios, through securitization.
This week on Another Fine Mezz, host Tom Lemmon welcomed Alantra's SRT specialist, senior advisor, Jeremy Hermant as the third guest in the SRT Series.
Hermant discussed the increasing role of arranging banks in SRT transactions as the market increasingly opens itself up to smaller banks who need to efficiently manage their capital requirements.
In addition, Hermant spoke about the regulatory changes in the UK making SRT more competitive, and explained why regulators are encouraging SRT as the capital management tool of choice.
He also spoke about his own, varied career, having begun as an equity derivatives trader before moving into the precursor to SRT, then known as private debt mobilisation. All this occurred while Hermant was at Santander, learning and developing under the watchful of eye of Steve Gandy, the former Santander stalwart of securitization and 2024 winner of GlobalCapital's Lifetime Achievement Award for European Securitization.
Hermant also discussed how the industry has changed for the better, with offices reflecting society more broadly now, as opposed to looking (and smelling) like a men's locker-room.
Finally, Alantra's senior advisor explained why particularly in European securitization, building positive relationships based on kindness is key to success.
There was only one place to start this week's episode of Another Fine Mezz after Enpal's stunning debut solar ABS, the first of its kind in Europe.
European ABS reporter, George Smith, explained why the deal from Germany's largest renewable energy provider had such strong demand, although both he and host, Tom Lemmon questioned whether the deal would see a host of others following in the its footsteps.
Golden Ray 1 has clearly shown that things like solar ABS can be sold in the European securitization market, but it has also revealed just how difficult it can be to reach the required scale.
Away from Enpal, there is the small matter of the US presidential election. Recording took place before Donald Trump's historic victory but with the dust still settling, signs of life in the pipeline are not yet apparent.
This week on Another Fine Mezz, host Tom Lemmon sat down with Man Group's, co-head of credit risk sharing, Matthew Moniot for the second episode of GlobalCapital's SRT Series.
Moniot explained how the world of risk sharing has changed since he first started dealing with "SRT-like" products in the late 90's. And now, senior leaders within banks have recognised that it's not just a regulation-driven product, but a key part of their toolkit when looking at efficiency.
In the last 12 months, the market has become more competitive and more transactional, Moniot said. But that isn't necessarily good for the long-term health of the market.
In the second half of the episode, Moniot looked back on his career in finance, why he enjoys being on the buy-side, and why he calls himself "the last fiduciary in the world".
Finally, Moniot reflected on his relatively new role at Man Group, and life in London.
On this week's episode of Another Fine Mezz, host Tom Lemmon and European ABS reporter, George Smith geared up for yet another busy week in ABS with the market's late-September slump looking well and truly over.
As the US presidential election on November 5 draws ever closer, it seems more and more market participants are not terribly fussed about it, despite worrying about it for most of the year.
That's particularly true for the sterling market with NewDay, LendInvest, Arval and Yorkshire Building Society all offering up paper this week and beyond.
Meanwhile, last week Mercedes and Santander priced euro deals, while Oodle and Nationwide got away in the UK.
Not to be outdone by the EU, the UK's Prudential Regulation Authority (PRA) announced some proposals on securitization, including a new formula for the p-factor, which should make ensure that using securitization to improve banks' capital treatment remains economical.
The PRA is also looking at growing the credit rating agency (CRA) market and has included some smaller agencies like KBRA, Arc Ratings and CreditReform on its list of approved CRAs.
After teasing it for weeks, the new SRT Series of Another Fine Mezz is here.
European ABS reporter, George Smith sat down with Frank Benhamou, risk transfer portfolio manager Cheyne Capital to kick the series off. Prior to Cheyne Capital, Benhamou spent over 17 years at Barclays, where he was one of the key architects of the bank's SRT platform, making him the perfect person to begin the series.
In this episode, Benhamou explains why SRT is proving so popular, growing at around 20%-30% year on year for the last few years, and why it is set to only continue, particularly as US banks start building their platforms.
He went on to discuss Cheyne's re-emergence in the market since he joined in April, and the challenges with building a high-quality SRT portfolio.
Finally, as ever with special guests, Benhamou looked back on his career in securitization, how he came to love the industry, and why it is perfect for the "all-rounder".
The great regulatory war over European securitization could soon be coming to an end following the European Commission's launch of its consultation last week. Naturally, the Another Fine Mezz team were very excited to summarise the reaction so far, not least for host, Tom Lemmon.
European ABS reporter, George Smith was also on hand to discuss what could happen, with many market bigwigs hopeful that this could be the beginning of the end of securitization's regulatory purgatory.
At first look, everything is on the table. And with 167 questions to answer, that should be ample time to discuss whatever it is respondents want to change.
There are also some hints that high-quality securitizations could be treated more favourably under the liquidity coverage ratio. However, the CLO market may find itself under greater scrutiny over whether it should be treated as a private transaction.
Back in the market, issuance has slowed to a steadier pace but the sterling market looks to be heating up, while there are also deals from Santander Germany and Mercedes.
And finally, some trivia reveals that the Another Fine Mezz team should stop asking for whom the bell tolls.
This week on Another Fine Mezz, host Tom Lemmon sat down with KBRA's head of European research, Gordon Kerr as part of a sponsored episode looking ahead to KBRA's structured finance symposium.
Kerr spoke about the brilliant, record-breaking year for the European securitization market and the hope that this could be just the start with optimism building that transformative reforms for the sector are on the way.
He also gave a sneak peak of what to expect at KBRA European Structured Finance Symposium, which takes place on October 17 in London. There's plenty to look forward to with speakers from the likes of Barclays, Bank of America, Citi, Blackstone and 400 Capital.
Finally, Kerr reflected on his career that began in the late 1990's, and in particular, how he manages to look so cool even when the heat is on.
With the summer holidays of the Another Fine Mezz team well and truly over, it was back to normal this week. Similarly, the European securitization market has eased into October with deal flow slowing to a much more manageable pace.
WiZink bank completed a successful return to the market after a troubling debut in 2023 for its Portuguese credit card ABS. However, host Tom Lemmon argued that despite a much smoother ride this time around, the trade revealed familiar problems in European ABS. Despite a record year of issuance, the investor base is still far too small and doing the credit work takes far too long.
Meanwhile in the UK, Tandem Bank's debut RMBS caught the attention of European ABS reporter, George Smith. It was a roaring success but the question is whether it's a further sign that UK challenger banks will start using the securitization market to help with capital management with trades not dissimilar to the large banks' significant risk transfer deals of recent years.
Finally, Tom's wine-tasting trips are bearing fruit as he explained how new businesses that aim to make it easier to invest in assets like wine, art or fancy cars are looking to use securitization technology and asset-backed lending to help them scale.
Amid the hustle and bustle of DealCatalyst’s UK Mortgage conference, GlobalCapital’s Tom Lemmon and European DataWarehouse CEO Christian Thun managed to find a quiet enough spot to sit down and record a special episode of Another Fine Mezz.
A self-proclaimed “data guy”, Christian did a PhD in AI nearly 25 years before the rise of ChatGPT. He got into the securitization market while working at Moody’s, before joining European DataWarehouse in 2016.
He told Tom about a recent report from his colleagues into whether better energy performance certificates on homes really means better credit quality mortgages; what needs to change in European securitization regulation; and why having the right data available is like an umbrella.
Luckily the background conference noise could be expunged from the podcast with some editing wizardry.
On this week's episode of Another Fine Mezz the podcasting duo of host, Tom Lemmon and European ABS reporter, George Smith barely had time to come up for air thanks to the wealth of supply in the market and the publication of Mario Draghi's report on European competitiveness.
Starting with Draghi's report, the former president of the ECB published his report for the European Commission and set out in rather more detail than before, how European securitization should be revitalised. One market participant said to GlobalCapital, it was no longer a "pious hope" of reform, but actionable changes that were now on the horizon.
There are some concerns over whether the liquidity coverage ratio will be included in the bits of the EU Securitization Regulation that are up for reform, which one investor likened to making cars with only three wheels allowed. But overall, it is a further sign that the market could be freed from its regulatory chains sooner rather than later.
Back in the real world, issuance for the year is set to be a post-global financial crisis record. And in large part, that is down to the amount of bank supply. George explained the two key reasons why it is happening this year and reflected on the frantic demand for Southern European mezzanine notes in the last couple of weeks too.
“What's in a name? That which we call a rose by any other name would smell just as sweet," wrote William Shakespeare in his play, Romeo and Juliet. In this week's episode of Another Fine Mezz, it seems that the answer is quite a lot actually, Bill.
European securitization issuers are known for their creative labelling of SPVs, but it has always seemed somewhat silly and meaningless. But following the success of specialist UK mortgage lender Paratus' new mixed pool RMBS shelf, the £564m Braccan 2024-1, the value of keeping everything neat and tidy is clear.
As European ABS reporter, George Smith said himself it was simply too hectic this week to mention every single deal that hit the screens this week. By our count, there were 10 deals that priced and the pipeline continues to grow.
Alongside the manic market, roughly 400 securitization specialists took time out to attend S&P's European Structured Finance Conference in London, where there was a perfect storm of positivity. In part, it's driven by the active and stable market they have in front of them, but it's coupled with a tantalising hope that meaningful regulatory reform is on the way.
And finally, while George wrote an ungodly amount trying to cover all of this off, host Tom Lemmon was busy gallivanting around London talking about his golfing success of the weekend and visiting Coterie Holdings, owners of wine-backed lender Jera and part owners of wine investing platform, WineFi. Thankfully, his 10 minute dissection of the wines he tried did not make the final cut.
This week on Another Fine Mezz, the podcasting quartet was in mourning for it was the last episode with CLO reporter (and co-founder of the podcast) Victoria Thiele.
Although Victoria is definitely taking a six-week break, she may return in some capacity as a part-timer in October, so it's not all doom and gloom.
If it is to be her last, there was fittingly humungous CLO news to make up for the occasion as European CLO manager Fair Oaks became the first to successfully launch a CLO ETF in Europe. However, to Victoria's dismay, its more aimed at institutional investors and high net-worth individuals than millenials with a trading app.
Meanwhile in ABS, European ABS reporter George Smith and host Tom Lemmon barely came up for air last week as the autumn rush got well under way with 11 deals in the market at one point.
Issuer tactics will be interesting to observe from the sidelines, with many thinking that there's no reason to wait with demand so strong. However, George reckons that the US election won't create half as much panic as some syndicate desks assume.
In this week's episode of Another Fine Mezz, host Tom Lemmon was standing in once again for the travelling George Smith, and while he expected a quiet mid-August week, the European ABS market had other ideas.
The expectation was that the market would begin to stir following the UK bank holiday on August 26, but a number of auto ABS issuers began marketing deals early to ensure investors get a good look.
It seems the expectation that September would be busy has been changed to September will be extremely busy. It could end up looking like a battle royale in no time at all. Looking further ahead, the question is how long it can last.
Meanwhile in CLOs, the market looks to be having something of a volatility hangover with deals taking a bit longer to complete and landing a bit wider.
That gave CLO reporter Austin Barnes his first opportunity to delve into the niche world of deal documentation, focusing specifically on overcollateralization (OC) tests.
OC tests are used throughout a CLO to ensure that each tranche is protected, but further down the stack on the single-B's they become a useful guide for which investors hold the balance of power.
Managers, desperate to get 3rd party equity involved, are trying to loosen the terms and get rid of OC tests on the single-B tranches but mezz investors are holding firm, for now.
This week on Another Fine Mezz was dominated by host Tom Lemmon's love of talking about a regulatory revolution in European securitization.
The European ABS market was quiet once again, but that gave time to dissect a research paper by Risk Control and authored by a who's who of securitization's regulatory big beasts.
There are number of transformative proposals put forward, but perhaps the most crucial is the way it seeks to reframe the debate towards how securitization can help the EU economy grow.
Meanwhile in CLOs, CLO reporter Austin Barnes might just have had his first scoop with Acer Tree set to return to euro CLOs soon after an unlucky start a few years back.
Finally, CLO reporter Victoria Thiele thinks she's found some more evidence to show that a first European CLO ETF is edging closer.
After a manic Monday on which some ABS bankers wondered whether we would even have a market by the end of the week, the Another Fine Mezz team is happy to report that we do.
Yet again, ABS reporter George Smith appears to have deserted his post just when all hands are needed. He spent the week driving through the Scottish Highlands blissfully unaware of volatility indices, while host Tom Lemmon and the CLO duo of Victoria Thiele and Austin Barnes held the fort.
Despite fears of a new global meltdown, Santander managed to add yet another prime RMBS from its Holmes Master Issuer shelf. It was only a day later than expected, and looked rather elementary by the end.
Meanwhile in European CLOs, a market perhaps more directly affected by the meltdown that wasn't, the impact on sentiment really depended on who you asked. Nevertheless, by the end of the week a cautious optimism had taken hold — as Sona, Polus and Palmer Square all priced deals.
As for the US CLO market, spirits rebounded remarkably quickly despite one banker's Armageddon forecast on Monday. By the end of the week, it was back to the usual rhythm.
On this week's episode of Another Fine Mezz, it was something akin to podcasting musical chairs with CLO reporter, Victoria Thiele, taking over from usual host Tom Lemmon, alongside the return of new CLO reporter Austin Barnes while George Smith stayed firmly put as ABS reporter.
With August now upon us, it was perhaps no surprise that there were no publicly placed deals in European ABS this week. However, George did manage to find time to rage at the low-quality opinions circulating LinkedIn on significant risk transfer (SRT) deals.
Meanwhile, in CLOs the resets keep on coming. The triple-As may be wider but with such dramatic tightening on the mezz this year, the overall costs keep the arbitrage working and managers printing. However, looking further ahead, loan shortages might soon start to scupper the euro CLO market.
And finally, last week, Austin left listeners hanging over where his weird accent comes from and this week he reveals all... did you guess right?
This week on Another Fine Mezz, the usual suspects of host, Tom Lemmon and CLO reporter, Victoria Thiele were a man down owing to European ABS reporter, George Smith losing his voice - of all things.
However, GlobalCapital now has a securitization podcasting production line not dissimilar to Australian cricket's fast bowling ranks, which meant it was time for a debut (more on the Australian cricket references later). George's absence paved the way to welcome the newest CLO reporter, Austin Barnes to the show.
In European securitization, just one deal was priced, Bletchley Park Funding 2024-1, by specialist buy-to-let lender Quantum Mortgages.
And with so little activity in Europe, an Australian reverse mortgage RMBS took the limelight. The deal, by Household Capital, was the biggest Australian reverse mortgage RMBS in a decade at A$263m ($172m), but the Aussie securitization market as a whole appears capable of teaching the European market a thing or two.
Meanwhile in CLOs, resets and refinancings were the dominant force in the US, particularly as triple-A spreads are stuck in the 135bp over Sonia range. It's better news for Euro managers though, as third party equity appears to be back for good in Europe, at least for the tier one managers.
On this week's Another Fine Mezz, usual host Tom Lemmon was taking a well-earned break to play golf, but it seems his enthusiasm for the sport has spread to European ABS reporter, George Smith. Perhaps he was also inspired by the professionals in Troon this weekend.
Away from golf, it seems European CLO equity may be getting easier to sell too. It's not quite "gimme" distance but for the biggest players, it is starting to feature in conversations more, CLO reporter, Victoria Thiele said.
In European ABS, it was a delightful week for debut issuers with three out in the market for the first time. In 2024, there has been a notable increase in debut deals, in part because the market has been so treacherous in recent years. But it could also be a further sign that securitization is becoming a viable funding option once again.
GlobalCapital's CLO reporter, Victoria Thiele, returned to her desk just in time from her trip to Germany this week, in what was a collection of the weary thanks to international football and growing babies.
With a less hectic week in the primary ABS market, securitization editor, Tom Lemmon, and European ABS reporter, George Smith discussed whether fine wine ABS might soon be a thing after an interview with a wine-backed lending platform.
With the dust just about settling following the EU election, UK election and French parliamentary election, the big story of the week looked at how the momentum for regulatory reform in securitization would change in this new political dynamic.
French president Emmanuel Macron may be weakened, but all is not lost, according to some market participants.
On CLOs this week, managers glided inside 130bp over three month Euribor with deals from CVC Partners and Spire the first to get below the barrier. In addition, Victoria also explained how the economics of resets can still work even if its not a direct tightening on the triple-A notes.
Finally, the Another Fine Mezz team had its fourth member play them out on the tambourine.
At last, the Another Fine Mezz team's CLO Series is back with a bang after to chatting to potentially the hottest property in CLOs.
That is John Kerschner, head of US securitized products and portfolio manager at Janus Henderson. Also known as the man behind the mammoth CLO ETFs, JAAA and JBBB.
Together, the two CLO ETFs have just under $12bn in assets under management, roughly doubling in size since the start of 2024.
On the episode, Kerschner explained how ETFs work in a CLO context and the challenges they will still face. One of the biggest challenges is educating investors, whether they be new to CLOs or new to ETFs. And he also touched on Janus Henderson's plans for a European CLO ETF.
As ever in the CLO Series, Kerschner spoke about how he went from an ecology graduate to a securitization investor, the keys to being a good investor, and how to stay as calm when things get hairy.
Holiday season is in full flow it seems for the Another Fine Mezz team.Last week, usual host, Tom Lemmon, was enjoying an early Summer break, and so this week he stepped into cover for European ABS reporter, George Smith.
This was a week characterised by election excitement, with every issuer still in the market looking to be done sooner rather than later. Deals from Cerberus and Ford's German branch followed with no hiccups but the visible pipeline is now quiet.
In the meantime, building from Bank of America Research's report on insurance companies using European securitization, which showed it to be pitifully low, there were signs in the UK that insurers are starting to take a closer look once more.
It's a small change, but it is yet another morsel of evidence that suggests the resistance to European securitization is thawing, albeit slowly.
In CLOs, Arini priced yet another successful Euro CLO to go along with its growing reputation despite its infancy, while a number of resets and refinancings got away well too.
CLO reporter, Victoria Thiele also released a first half of the year league table for both the US and Europe. Both markets experienced a better than expected year with tightening and lots of issuance, the only question is how much more will come in the second half of the year.
The weird and wonderful world of European securitization was in full view last week with a number of issuers showing off their creative sides through their penchants for animal-themed shelfs.
Hyundai had an Auto ABS named Pony, while ING came out with yet another Green Lion, but most interesting of all in the animal ABS kingdom was from Cerberus' buy-to-let RMBS, Edenbrook Mortgage Funding.
It's a one-off deal from a portfolio of loans that was not included in Cerberus' sale of CHL Mortgages to Chetwood Financial, and is expected to price on Wednesday.
The €1bn Green Lion 2024-1 is the second edition of ING's rare Dutch prime RMBS that is, as the name suggests, aligned with the Icma Green Bond Principles for Green Use of Proceeds and Green Collateral. This time around, it's also aligned with the EU taxonomy on energy performance and climate risk.
Meanwhile in CLOs, the market continues to trend tighter after Fidelity's 131bp over three month Euribor print on Thursday. And issuance could pick up soon with a wave of repricings in the loan market accompanied by new money loans as well.
Both markets are keeping an eye on the elections in both the UK and France, with little new supply expected this week. However, with barely any predictions for anything other than a Labour victory in the UK, sterling issuance should pick up by July 8. The rise of Marie Le Pen in France is somewhat more difficult to grasp, as CLO reporter Victoria Thiele is at pains to point out.
What a week it was for European securitization, filled with both encouraging and worrying events for the Another Fine Mezz team to get stuck into.
Firstly, host Tom Lemmon stepped into his old European ABS shoes to cover the exciting news that some form of public renewable energy ABS might soon be a reality in Europe.
On June 14, Hometree, a UK-based residential renewable energy provider completed the first ever renewable securitization warehouse in the UK, in a £250m deal with Barclays. That means the UK is now in a three-way race to be the first to issue in the public market with Germany and Spain. But a bit like the football, the Germans look favourite to cross the line first.
Meanwhile, all is not well in European CMBS. Senior noteholders in a European CMBS stand to lose principal for the first time since the global financial crisis of 2008 on UK retail deal Elizabeth Finance 2018. "It's a bit of a shock," said one source close to the deal.
Finally, in an otherwise quiet week for European CLOs, Palmer Square managed to drag investors to the tightest print of the year. However, despite all the tightening, long-term hurdles remain in the market.
Stellantis grabbed the attention of the Another Fine Mezz team this week after pricing a huge €1.2bn Italian auto ABS with investors desperate to get their hands on it.
The buzz from Barcelona is still continuing it seems with strong demand for a range of ABS paper, including Nationwide's second 'stock and drop' deal and yet more Italian paper, in the form of consumer ABS.
Meanwhile in CLOs, the market is reopening at a slightly more leisurely pace. But Bain's decision to get out early has paid off, pricing at 141bp over three-month Euribor on Thursday.
Finally, the team basked in the glory of finally acquiring a professional production editor.
A jam-packed episode of Another Fine Mezz this week meant a full line-up of podcasters was needed, and they duly delivered.
With European securitization reporter, George Smith, away for the last couple of weeks, he was forced to pick his favourite. As ever on the podcast, creativity in the market is rewarded and so it was perhaps unsurprising that the auxmoney-owned Lender & Spender deal named after a dog won out.
CLO reporter, Victoria Thiele had been away for most of the week, leaving host Tom Lemmon to straddle both US and European CLO horses. The US market, led by AGL Credit's 140bp over Sofr print, is flying. At the time of recording Euro CLOs was winding down, but a late Friday rush was expected and five managers got a variety of transactions done before the Global ABS conference.
In addition, for the second half of the podcast George spoke to Mirco Iacobucci, senior vice president and sector lead of European real estate ratings at Morningstar DBRS for a sponsored interview on CMBS. With CMBS having a mini-revival this year, the pair discussed the birth of data centre CMBS in Europe, performance issues in the sector and the outlook for the rest of the year.
This week's episode of Another Fine Mezz had a distinctly American flavour to it, owing to CLO reporter, Victoria Thiele's trip to New York and the rapid tightening in the US CLO market.
In addition, European securitization reporter, George Smith, was away taking a well-earned rest after his gigantic contribution for GlobalCapital's Global ABS special report (which delegates can get their hands on from June 4).
The US CLO market has tightened dramatically in the last couple of weeks. Where once 150bp over Sofr on the triple-As was considered a hard line in the sand for investors, some managers are close to printing at 140bp and many expect it to continue down towards 135bp.
Meanwhile, the squeeze on spreads has eroded the tiering premium to all but a couple of basis points for the tier two and three managers, such is the demand for CLO paper.
Finally, the Another Fine Mezz team is delighted to announce that they have twisted the arm of Invisso just enough to get the chance to record the podcast live from Global ABS in Barcelona. The podcast is scheduled to go live at 2.10pm CET in the exhibit hall, where all are welcome to enjoy the usual ramblings over lunch.
This week on Another Fine Mezz, securitization editor Tom Lemmon gave usual podcasters George Smith and Victoria Thiele a well-earned rest.
That was to make way for Michael Herzig, senior managing director and head of business development at First Eagle Alternative Credit in the first episode of GlobalCapital's CLO series.
The US CLO market is back firing again with some now even contemplating whether 2024 will exceed the banner year of 2021.
Herzig discussed how he thinks the rest of the year will play out, how middle-market CLOs will grow in importance, and how the market has helped reinvent itself in the years since the global financial crisis.
The second half of the episode discussed Herzig's over 30 years in the industry, including sitting just four desks away from Greg Lippman of Big Short fame as the first rumbles of a looming crisis arrived.
Finally, Herzig shares the keys to success in the world of CLOs, perhaps best summarised as "don't be a jerk".
This week on Another Fine Mezz, the spectre of challenging diaries due to time difference meant usual host and securitization editor Tom Lemmon had to miss out. However, European reporters George Smith and Victoria Thiele went on a whirlwind tour of securitization in super quick time.
Although it seems some in the market may need to go back to school because there's a CMBS comprised solely of data centres, rather than the usual commercial real-estate mortgages. But as George said, the 'M' stands for data centre.
There's also an update on the booming significant risk transfer market, with issuers beginning to prefer cash deals.
Meanwhile in CLOs, Brigade made a roaring return to the market after three years away (who can blame them?). With arbitrage the best it's been in a while, they've even secured third-party equity.
The UK had a lot going on politically with its local and mayoral elections last week, which perhaps explains why the future of UK securitization regulation wasn't on the front page of the nationals.
However, for GlobalCapital's team of securitization podcasting hacks on Another Fine Mezz, it certainly was.
European securitization reporter, George Smith discussed what changes have been finalised in the new UK regulations which will come into force on November 1. There is also hope that it will lay the groundwork for more radical reforms in the future. Surely, things can only get better.
There is also an unusual pipeline developing in European ABS, with two CMBS transactions in the works alongside a huge Italian RMBS.
Finally, CLO reporter, Victoria Thiele has less deal activity to report on but managers are still grinding away to tighten the market. Palmer Square has led the way, dragging the market to pre-Ukraine war levels.
It was another week of 100% attendance from the Another Fine Mezz team, but such was the quality of stories this week, there was a fair bit of bickering over who got to go first.
For the starter, European Securitization reporter, George Smith had Santander's mammoth German consumer ABS to discuss, where investors chose to fill up on mezz.
Then, the main course was provided by CLO reporter, Victoria Thiele (and to a lesser degree, securitization editor, Tom Lemmon) as the European market salivates at the prospect of its first CLO ETF after seeing the boom in the US.
Continuing with the culinary theme, dessert is learning the lengths to which George Smith will go to watch his beloved Arsenal in the North London Derby.
A full house again on Another Fine Mezz this week where CLO reporter Victoria Thiele was practically bouncing off the walls with three Euro CLOs to report on.
However, host Tom Lemmon didn't quite burst her bubble as much as put into context how small it is with an update on the flood of primary market supply in US CLOs. The question across the Atlantic is whether spreads can tighten with so much in the pipeline.
Finally, in less pleasing news, European securitization reporter George Smith explained the issues facing the first ever Green European CMBS, River Green after it was downgraded for the second time by Moody's.
This week on Another Fine Mezz, the full podcasting trio was on hand to digest yet another hectic week for European Securitization.
First up, ABS reporter, George Smith - with his wonderful new microphone - explained why Belmont Green's buy-to-let RMBS deal took the plaudits amongst a packed field, and even got the GlobalCapital cartoon as reward for printing just 40bp wide of UK prime RMBS.
In CLOs, reporter Victoria Thiele spent the week continuing to analyse how the Altice debacle would affect CLO managers, and in particular, their triple-C buckets. Securitization Editor, Tom Lemmon also chipped in with more positive news from the US CLO market, where the pipeline is so busy its preventing anyone from tightening their triple-As.
In an admirable effort to bring securitization to the people, George sat down on a Monday morning straight out of a holiday, beard still wild and unkempt, to discuss the latest movements in the ABS and CLO market with Victoria.
Unusual activity in the second lien UK RMBS market kept the GlobalCapital reporters busy last week. George dug into the drivers of growth in this niche sector. For listeners who cannot get enough of second charge mortgages, Victoria spoke about Equifinance's recent debut deal on AFM's sister podcast in George's absence on Friday
Primary CLO activity is taking its sweet time to restart after Easter, but great things may lie ahead: Deutsche Bank bumped its new issuance forecast for 2024 up to €37bn off the back of a record first quarter. Victoria discussed how amortisations could increasingly drive supply and demand in the months to come.
Victoria Thiele took on hosting duties for this week's episode of Another Fine Mezz with usual host, Tom Lemmon, off playing golf somewhere.
With so many ABS deals in the market, Victoria also had to ease the load on George Smith earlier in the week.
But Victoria and George weren't the only ones in need of a little extra time. European ABS investors were so stretched that the question is not around whether there's enough demand to keep issuance flowing, rather if there's enough time to do the necessary due diligence.
In European CLOs, Victoria went for depth as opposed to breadth this week after Arini impressively returned to the market for just the second time.
And finally, while many want to believe that market participants in securitization only care about maths (and money), one "ratings guy" proved there is also room for fashion.
This week's episode of Another Fine Mezz had a certain morning after the night before feel, with Tom Lemmon and Victoria Thiele still a bit fragile from their midweek fun. Fortunately, George Smith had youth on his side to lend a steadier hand.
The trio reflected on a bustling (and boozy!) night at GlobalCapital's 2024 European Securitization Awards.
While the event was a great success, it was not enough to stop a pickup in activity in ABS, particularly in euros. Plus in sterling, the market looked on with intrigue as Nationwide initiated its first "drop" of Silverstone Master Issuer stock.
The outlook is perhaps not as rosy in CLOs where there could be some spread plateauing after a strong few weeks. Bubbling away in the background are yet more arguments about loan docs as power shifts away from CLO managers.
And finally, George gives a masterclass in the art of self defence.
This week on Another Fine Mezz, it was a case one step forward and two back as host Tom Lemmon returned only to find CLO reporter, Victoria Thiele away from her desk and enjoying the beauty of South Korea.
With Tom only just back in one piece after SFVegas 2024, there was much to discuss. From spying who's visiting from their European bases, to paying homage to the superior knowledge residing in GlobalCapital's marketing team, and of course, the unofficial winners of the Swag awards.
With many European teams out in Vegas, George had time to investigate mezzanine spreads a bit deeper with Pepper's recent deal showing some impressive figures.
Finally, there was a look ahead to GloablCapital's European Securitization Awards on March 13, which is also in conjunction with the first GC Live on all things UK Securitization.
As much the three hosts of Another Fine Mezz love talking about deals, this episode is dedicated to the people who make them happen. At the start of a new year, some of our listeners may be thinking about the next steps in their careers, while others are looking to grow their teams.
We are very pleased that Edward James, structured finance recruiter and founder of RCQ Associates, agreed to sit down with Victoria and chat about his expectations for job opportunities and compensation in 2024.
But of course, George and Victoria can not resist a bit of market chat. The ABS market is finally back with some activity — including one deal that makes a reporter sing. In CLO world, spreads might not be getting tighter but they are getting more interesting.
Sadly, Tom was on a plane to Las Vegas for this recording, while the (fun) chaos of SFVegas 2024 saw the podcast edited somewhat slowly too.
With SFVegas just hours away, Tom Lemmon sat down with Michael Bright, CEO of the Structured Finance Association (SFA) to hear how preparations for the huge annual gathering was going.
Around 9,000 attendees expected this year, which means Bright and the team at the SFA are constantly looking improve the offering at the Aria Hotel to keep the securitization market coming back. That included dealing with some of the nuances required for the most high-profile of guests.
Bright has had an extremely varied career, which includes stints at Wachovia Bank, BlackRock, Ginnie Mae and working for a US Senator.
Finally, Bright spoke about his constant desire to learn led him to explore different sections of finance and policy work.
On Another Fine Mezz this week, European reporters George Smith and Victoria Thiele were given a little break while Tom Lemmon gears up for the SF Vegas 2024 conference next week.
This episode is the second in the US Securitization mini-series where market participants across the sector discuss their area of expertise, but also how they got there and what it’s really like to do day in day out.
For this episode, Tom sat down with Madalyn Miller, partner and co-head of transportation and space at law firm Gibson Dunn.
Miller specialises in aviation ABS, which has had a rough few years, to put it lightly, following the pandemic in 2020 and war in Ukraine. She also discussed what it was like working through these unprecedented events and how she expects to see more improvement this year in the sector.
Finally, Miller touches on getting a good work/life balance, even with children, and how has been in the industry as a woman.
Note: This interview was recorded before Alexei Navalny’s death on February 16th was announced.
Victoria Thiele and George Smith were left to their own devices as Tom Lemmon had the audacity to take a week off, although he still managed to launch a mini series that will supplement the regular Another Fine Mezz episodes in the coming weeks.
ABS issuance seemed to be taking a breather after the January rush, but that only gave George the time to dive into a particularly juicy story (and to coin the term Bridgegate-gate).
Victoria had a slew of CLOs to cover, and not just any CLOs - from CVC's first ever static deal to a quirky feature of BlueBay's print, it was a bountiful week. There was also a boom in secondary equity trading, while others may suffer from a wave of loan repricings.
◆ No need to panic for consumer ABS
◆ Trusting your gut with career opportunities
◆ From the USSR to structured finance
This week’s episode of Another Fine Mezz with the full team may have come and gone but this bonus episode, is the first in a mini-series where global securitization editor Tom Lemmon, talks to market participants from across US Securitization.
Tom and his guests will focus not only on market trends but also each guest’s career and personal development.
The guinea-pig for the first episode was Vadim Verkhoglyad, head of research at structured finance fintech Dv01.
Verkhoglyad explains why the consumer ABS market has gone much better than some had feared over the past 18 months. He also spoke about how his family moved from the Soviet Union to the US when he was just eight years old and how that led to a career in finance.
Finally, Verkhoglyad gives his thoughts on what to study if you want to make it in the industry.
◆ VW misses ESG deadline
◆ Good times for ABS
◆ CLO triple-A funds fear fall from power
All three podcasters were reunited once again after a good week all around. While Tom tried the best burger in NYC (second best, everyone knows Corner Bistro is the best - Ed) and Victoria had reason to feel famous, George held the Big Car to account.
Volkswagen broke its promise to provide loan level emissions data for its ABS transactions. Worse, the car maker did not offer GlobalCapital a good explanation for why it missed the deadline.
Market conditions are looking good for European securitization, but a steady stream of deals looks more likely than a mad rush.
And while CLO equity investors are willing to at least consider buying deals again, investors in triple-A rated tranches see their bargaining power waning.
This week's episode of Another Fine Mezz was a tale of determination, of squeezing every last drop you have left.
Firstly, the clouds look to be finally clearing for UK buy-to-let (BTL) lenders, leading OneSavings Bank subsidiary Charter Court to drive its latest UK BTL RMBS tighter.
Then in European CLOs, managers continued to take advantage of strong sentiment as they crunched spreads tighter and tighter with some now eyeing the 140bp range on the triple-As. That's better than the US market, and about 30bp tighter than the end of 2023.
And finally, Securitization Editor Tom Lemmon returned to host. That was despite his voice nearly deserting him and knowing that his film debut on LinkedIn was likely to see him bullied.
Another week, another episode of Another Fine Mezz with a man down as Tom Lemmon faced yet more roadblocks on his path to being a complete US employee.
Back in London, Victoria Thiele stood in as host to proudly proclaim herself as a dark horse for securitization podcast host of the year.
As the newest jet-setter in the podcasting trio, George Smith reported back from a hectic week where he moderated a panel at IMN's CEE Securitization Summit in Vienna. Meanwhile, there was a glorious resumption of issuance in the euro ABS market with issuers growing their books and tightening spreads seemingly at will.
Slightly less glamorous but no less important, Victoria discussed how the broadly syndicated CLO market is set to launch its counter offensive against the private credit players that have taken so much of its lunch (and airtime).
Finally, there was an urgent appeal for specialist UK mortgage lender Dilosk to add an extra shelf for its RMBS programs.
◆ Europeans want UK RMBS
◆ ESMA perplexes investors
◆ CLO amortisation: a vanishing act
Just two weeks into the year and Another Fine Mezz is one man down. The cold, the jet lag and a US bank holiday conspired to take Tom Lemmon out; leaving Victoria Thiele and George Smith to discuss the latest in European securitization between themselves.
With deals galore in the UK RMBS market, it was a near miracle that George found the time to talk to investors about their confusion at the European Securities and Markets Authority's suggestion that they could have been anything but against simplified disclosure templates.
The CLO market is off to a much slower start than ABS, although a few managers have started to market deals. Victoria thinks those that are not should not wait too long.
Amortisations of vintage CLOs could wash some welcome cash into the primary market. But despite a few liquidations in the last two weeks, Victoria is not too hopeful that managers and equity owners will be sprinting to repay debt investors early.
With 2024 upon us, the Another Fine Mezz team are calling this week's episode the first of season 2.
All three of Tom Lemmon, Victoria Thiele and George Smith were recording this week, while George was particularly needed after a rapid start to the new year in UK prime RMBS. Lloyds' Permanent deal also got a rather snazzy cartoon for George to brag about.
However, Victoria may feel that she could have had a couple more days recovering from her NYE exploits with loan prices looking like they might delay Euro CLO issuance in January.
Meanwhile, Tom's regulation addiction got a welcome hit after a consultation paper from the European Securities and Markets Authority (ESMA) was released just before Christmas.
And finally, the team discussed the brilliance of George's upper lip hair.
In the last episode before Christmas, George Smith and Victoria Thiele discuss why Europe’s ESG securitization issuers are still feeling upbeat despite the lack of a clear ‘greenium’.
Tom Lemmon was off this week, hopefully brushing up on his golf skills, after George Smith’s exploits at the GlobalCapital Christmas party put his status as Another Fine Mezz’s resident putting expert into doubt.
Victoria also had an update on the CLO market this week and the pipeline for January, which is heating up too.
This week's episode of Another Fine Mezz wentall Sci-Fi thanks to reporters George Smith and Victoria Thiele.
Intrigued by some survey data on the use of tools like ChatGPT, the question was whether artificial intelligence could start becoming more widely used in securitization and CLOs. It's unclear exactly how it'll be used and whether avid listeners to the podcast should be fearful for their jobs.
Meanwhile, host Tom Lemmon endured a manic week at Opal's CLO Summit in Dana Point, California.
As is becoming increasingly common, a lot of talk was around the emergence of private credit in CLOs this year. However, as the sector grows and the market builds around it, expect more scrutiny over liquidity and transparency, particularly if performance starts to wane.
And finally, GlobalCapital's European Securitization Awards 2024 went live this week. To vote and not end up bottom of the pile a la Manchester United, click here.
Host Tom Lemmon retuned for this week's episode of Another Fine Mezz, while reporters Victoria Thiele and George Smith were well-recovered from their midweek escapades with some unnamed contacts.
It seems European CLO investors are feeling pretty happy with themselves after a successful year where the asset class outperformed a number of competitors.
It's outlook season and so George was in London to hear a range of forecasts before giving his own, which argued that 2024 should be strong for European securitization, regardless of recession risks.
And finally, Tom explains why the chicken wing index is serious sauce.
With Tom Lemmon off giving thanks for a conveniently timed move to New York, Victoria Thiele and George Smith held the fort on this week’s episode of Another Fine Mezz.
Over the week, George and Tom had done a deep dive into Nationwide’s ‘stock and drop’ tactic for speeding up RMBS distribution, briefly mentioned on the previous episode. George explains why it’s a great idea, but won’t spare the market a bigger conversation about regulation.
Meanwhile, a commercial mortgage RMBS deal by Together illustrated the danger of over-categorising in the securitization market - at one point, it was mislabelled as a CMBS deal.
The European CLO market has begun to wind down for the end of the year. While banks publish their forecasts for mediocre issuance volumes next year, market participants turn a hopeful eye to middle market CLOs.
On this week's episode of Another Fine Mezz, reporters George Smith and Victoria Thiele put up with a rather exhausted and jet lagged host, Tom Lemmon.
Arini priced its long-awaited debut European CLO but as is becoming the norm for new entrants into the market, both in Europe and the US, the firm had to pay a slight premium. However, that in itself is not a bad thing, as Victoria also wrote on Thursday.
Meanwhile, European securitization was beginning its descend into holiday hibernation with little primary market activity.
However, Nationwide's fully retained Silverstone deal is an intriguing development. The UK high-street lender's idea is to issue a fully retained prime RMBS before selling it on over the following 12 months in what they've termed a "stock and drop".
This week's episode of Another Fine Mezz saw GlobalCapital's Tom Lemmon host from the comfort of his home in London for the final time, at least this year as he boards a plane to New York City.
European ABS reporter George Smith was a little under the weather, but CLO reporter Victoria Thiele stepped up to take the limelight and explain how raising capital for captive CLO equity funds is getting trickier.
Meanwhile, Tom discussed the significance of "hamming up" securitization in Afme's Capital Markets Union report, that new people and markets reporter Gaia Freydefont wrote about last week.
With the EU elections coming up in June, it seems securitization advocates like Afme are making a big push to get reform on the legislative agenda before the new MEPs and commissioners take their seats.
It was back to normal for this week’s episode of Another Fine Mezz as Tom Lemmon welcomed back reporters Victoria Thiele and George Smith.
With market activity drifting towards hibernation, that normally means it’s time for regulators to take centre stage. And so, the UK’s Prudential Regulation Authority (PRA) did, with its consultation paper on securitization and how it relates to the capital markets.
The paper hints at the UK attempting to align more closely with the US. However, as a lawyer told GlobalCapital, the UK must tread carefully between Basel 3.1 standards and UK competitiveness.
Meanwhile, in European CLOs there has been a late flurry of activity including a deal by Partners Group. Although, the credit curve appears to be steepening as triple-A investors are happy to play but mezz buyers seem ready for the holidays.
And finally, only one member of the Another Fine Mezz trio made George’s daughter cry in the office this week. No prizes for guessing who that was.
In this week's episode of Another Fine Mezz, Tom Lemmon reported from Miami at IMN and FIIN's ABS East 2023 conference, while the usual suspects, Victoria Thiele and George Smith, were given a well-earned rest.
Jennifer Thomas, vice president and portfolio manager at investment firm Loomis Sayles joined the podcast in between her hectic schedule as her team looked for opportunities amidst an uncertain macroeconomic backdrop.
GlobalCapital's US bureau chief, Oliver West made his first appearance on the podcast, from his vantage point of the exhibit hall. And, US RMBS and CMBS reporter Kunyi Yang also made her debut, explaining why 2024 could see a real tug of war in the office CMBS sector.
Brooke Major-Reid, chief capital officer at fintech consumer lender Affirm also dropped in, alongside KBRA's head of structured finance research, Brian Ford.
Tom Lemmon had his head in the clouds this week as he took off for Miami (if you’re at ABS East, get in touch for a meeting). So, it was up to Victoria Thiele and George Smith alone to discuss European securitization.
Equity release mortgages have been securitized in mostly private transactions for a long time, but George has heard good reasons why they might be on the verge of progressing into a public market.
While geopolitical tumult is shaking the market, Victoria discovered that uptier priming in European CLOs is about to lose its last sworn enemy among the triple-A investors.
At the time of recording, the team was still thrilled about the prospect of George visiting London for the first time in three months. Unfortunately, storm Babet had other ideas and forced him to delay his trip by a week. The good news is: this gives keen market participants five more days to snap up a coffee drinking slot with him, so do reach out if you’re not meeting him already.
Over the past week, host Tom Lemmon has (almost) come to terms with being the wrong side of 30, and is ready to apply the wisdom of old age to European Securitization with reporters George Smith and Victoria Thiele.
BPCE's prime French RMBS shocked bankers this week, but George Smith thinks it might be a sign that the market can finally move on from its summer struggles with the triple-As.
Meanwhile, Victoria armed herself with a yellow marker and dug into the European Leveraged Finance Association’s new guide to CLO carbon reporting and found a number of green shoots.
Finally, click this link to get access to GlobalCapital's 30-day free trial to get the full breakdown of everything discussed this week.
For this week’s episode of Another Fine Mezz, Tom Lemmon was joined by Ares Management’s co-head of alternative credit, Joel Holsinger to discuss the Private Credit Summit at ABS East 2023.
Ares are one of a number of private credit firms set to descend on Miami in two weeks’ time. Holsinger, also a keynote speaker at the conference, explained why firms like his are taking an even greater interest in securitization and how the two sectors can work together to grow the market. He also found time to suggest his favourite restaurant, although booking ahead is strongly recommended.
Meanwhile, Victoria Thiele and George Smith took great pleasure in discovering the Tom’s milestone age, which begins with the dreaded number three.
George compared the European Investment Bank’s impact in significant risk transfer to nuclear physics, while Victoria went to yet another CLO conference but this time, arbitrage was not the only topic of conversation.
This week's episode of Another Fine Mezz was something of an international tour with a wrap of the annual TSI Congress in Berlin and a discussion about the upcoming ABS East conference in Miami.
European ABS reporter George Smith was in Berlin last week and with the help of European CLO reporter (and German national) Victoria Thiele, discussed why this year's conference had a distinctly political tone.
Meanwhile, Victoria talked through her scoop on Man GLG's return to CLO management and how CLO mezzanine investors are urging caution as arguments around documentation heats up.
Finally, with IMN and FIIN's (the Fixed Income Investor Network) ABS East 2023 conference in Miami under three weeks away, Tom was joined by two guests to get the inside track.
Adam Grainger, director of operations for FIIN and investor & issuer relations at IMN, and Joe Lau, chairman of FIIN and president and chief investment officer at LordCap discussed why Miami is the ultimate autumn venue.
With GlobalCapital's CLO reporter Victoria Thiele taking in the last of the summer holidays, remaining podcast presenters George Smith and Tom Lemmon were left considering taking the show in a new creative direction.
Away from team politics, the European ABS market continues to fire. Curiously, it seems the mezzanine notes are getting considerably hotter than the seniors. We try to explain why.
Adding to the momentum, the French and German finance ministers publicly called for securitization to feature more prominently in the European capital market ecosystem. Whether this leads to any action any time soon, remains unclear.
Finally, Another Fine Mezz welcomed its first guest of the new series as Katie Prideaux, director of sustainable investment analytics product at LSEG Analytics spoke about the evolution of ESG as it becomes an ever larger consideration for market participants.
Bleary-eyed, European ABS reporter George Smith returned for this week's episode of Another Fine Mezz after the birth of his first child three weeks ago.
However, there was no gentle easing in as the European securitization market kicked into gear with a flurry of issuance.
In particular, prime UK RMBS continued its resurgence with Principality Building Society yet another UK issuer that was back in the fold.
In CLOs, it's also getting hectic, although not quite to the same degree. However, Victoria Thiele discussed how while issuance might be picking up for now, terrible arbitrage is likely to mean that any windows are narrow.
Finally, with the podcast trio unable to "milk" George's fatherhood any more, as one market participant said to Victoria, the team looked for new areas of discussion.
At one point last week, Another Fine Mezzhost Tom Lemmon worried he might be recording a podcast all alone as his colleagues got their last bits of summer holidays (and paternity leave) completed.
However, CLO reporter Victoria Thiele was on hand to save the day. It was a timely intervention as the European ABS market reopened with 8 deals entering the pipeline last week.
Santander kicked things off, pricing its second of the year from the prime UK RMBS shelf, Holmes Master Issuer 2023-2.
But stealing the limelight was ING's Green Lion, a green-labeled prime Dutch RMBS. A welcome step for ESG-securitizations, but whether there are signs of a meaningful market beginning to grow is unclear.
And finally in CLOs, Onex's head of credit Ronnie Jaber sat down with GlobalCapital to discuss his expectations for the rest of 2023.
Another Fine Mezz remains only two thirds full as European ABS reporter George Smith enjoys fatherhood and sleep deprivation. Thankfully, securitization deputy editor Tom Lemmon was kept company by European CLO reporter Victoria Thiele.
European Significant risk transfer (SRT) is set for another record year in 2023 after various regulatory disasters were averted. Meanwhile in the US, there is hope that banks will soon come to a compromise with regulators.
Onex priced its first European CLO of the year, and was the first in the region to split the single 'B' tranche. However, the slightly strange ratings revealed a mystery investor on the senior notes.
For this week's episode of Another Fine Mezz, securitization deputy editor Tom Lemmon is kept company by European CLO reporter Victoria Thiele as European ABS reporter George Smith is off to become a Dad.
In the US, specialist CLO equity funds believe they're "winning the argument" as limited partners (LPs) who invest in the manager-retained equity (known as captive funds) become frustrated at squeezed returns.
In European CLOs, triple-A investors are also frustrated. They're looking to limit the power of CLO managers that are happy to be dragged along into amend and extend deals, by beefing up the legal documents before investing in a CLO.
And finally, the Financial Conduct Authority's (FCA) 707 page document outlining its plans for the UK's post-Brexit securitization regulation is still being digested. The question is how the UK securitization market will look once its implemented.
For this week's episode of Another Fine Mezz, securitization deputy editor Tom Lemmon returned from his holidays (and golfing misery) to host, while all in the GlobalCapital stable are hoping this episode will be ABS reporter George Smith's last before he takes a breather to become a father.
Patrick Drahi, founder of telecom and media giant Altice tried to calm the nerves among CLO managers (and other obligors) last week, as the crisis around the company's debt and corruption allegations continues. With European CLOs exposed to around €4bn of Altice's debt, our reporters discuss the pervading sense of concern over said debt pile — and the wider impact it could have on the European CLO market.
The European securitization market has shrunk dramatically relative to the US since the global financial crisis in 2008. As the most battle-worn market participants are gradually out of the market to pastures new, there are concerns that their wisdom is being lost — and not being replaced. We ask whether this leaves the industry short on crisis experience.
Finally, the latest hot topic in debt markets has turned our structured credit team onto ontological investigation: what, exactly, is the difference between a private credit CLO or middle market CLO? It's not clear, and that's a problem for the market and investors.
Regular podcast host Tom Lemmon was away for another week, but Victoria Thiele and George Smith held the fort and put together a brand-new episode of Another Fine Mezz.
The UK government is handing the power to make securitization rules over to the FCA and PRA. Market participants are pleased by the prospect of speedier processes and speculate about life after EU regulation.
Apollo plots the first European CLO reset in a year. A dozen other issuers that priced at spreads above 200bp in the terrible market last year could follow.
Last but not least, an odd detail of business credit card securitization reminded George of Victoria’s story about middle market CLOs two weeks ago.
One week into the new and improved second life of Another Fine Mezz, host Tom Lemmon is taking a well-deserved holiday.
Markets never stop, of course, and so Victoria Thiele and George Smith sat down to discuss the biggest stories in European Securitization, as well as some interesting bits and pieces that were not featured in GlobalCapital articles this week.
Bankers and investors expect more European SRT deals by US banks, who were held back by regulatory uncertainty in the past. Appetite for US collateral straight from the market leaders is there – if the price is right.
It looks like an Asian investor took the entire AAA tranche of Investcorp’s Harvest CLO. Some market participants now dream of tighter AAA spreads if Japanese investors return, others dread their demands for bondholder-friendly deal documentation.
Last but not least, securitization specialists stepped in to help George find an appropriate name for his soon-to-be-launched 18 year project of raising Europe’s best financial journalist.
After a long hiatus, GlobalCapital's dedicated securitization podcast, Another Fine Mezz makes its return.
The podcast also underwent a mini makeover, with two more reporters joining Tom Lemmon to discuss the biggest stories of the week in European securitization.
Middle-market CLOs in Europe are struggling to get off the ground with the companies behind the loans often too small to meet the criteria for the big three rating agencies, Moody's, S&P and Fitch. However, UK private lender ThinCats is still hoping to press ahead with a transaction soon.
Meanwhile, social-labelled RMBS deals are already exceedingly rare, and creating a market for them in the UK needs to consider the systemic issues the mortgage market faces before being able to truly consider an RMBS as social.
Finally, a visit to Edinburgh leads to the first Another Fine Mezz scoop.
GlobalCapital's dedicated securitization podcast, Another Fine Mezz, makes its long awaited return as market participants from across the world gather for SF Vegas 2023.
Michael Bright, the Structured Finance Association's CEO, joined GlobalCapital's Tom Lemmon to discuss what to see at the conference, what the tone will be after the rollercoaster year of 2022, and who he's most looking forward to hearing from on the panels.
Welcome to the second episode of Another Fine Mezz, GlobalCapital’s new podcast about securitization where we explore the most pressing issues in the market with some its most senior figures.
In this episode we take a dive into the CLO markets in the US and Europe. 2021 was a bumper year for CLOs with record issuance in both markets. 2022 however, has been a rather more chastening experience, particularly in Europe as inflation and the war in Ukraine hit global markets.
So, is the CLO party over? Will spreads drift wider still? How will CLOs fare in a recession? We asked Tyler Wallace from Fair Oaks Capital, Tim Thranfrom Bluerock, and Sandeep Chana from S&P Global where the market is heading.
Welcome to Another Fine Mezz, GlobalCapital’s new podcast about securitization where we explore the most pressing issues in the market with some of its most senior figures.
Global ABS, the biggest securitization conference in Europe, is returning to Barcelona on June 14 for the first time since 2019. Everyone who’s anyone in European securitization will be there and so in anticipation of the event, we asked Owen Muller from NatWest Markets, Peter Cui from Natixis and Merryn Craske from Morgan Lewis what they were most looking forward to and what the big discussion points would be.
While the sun, sand and sangria of Barcelona will no doubt be a welcome change of scene for many, we look into what will be the key themes at the conference, how it might reflect and affect market activity and how to get your mitts on the best swag from the exhibition stands.