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In Support of CLO Risk Retention, If Not the Rule Itself

By Glen Fest

While requiring managers to hold 5% of the risk in their deals may be “overkill,” John Thacker of Crestline Denali Capital, sees merit in aligning the firm's interest with those of its clients.


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Latest News

JPMorgan Hit Hardest as EU Fines Euribor Trio $521M

– JPMorgan Chase, HSBC Holdings and Credit Agricole were fined a total of 485.5 million euros ($521 million) for rigging the Euribor benchmark as European Union antitrust regulators wrapped up a five-year investigation into the scandal.

Wells Fargo Marketing $750M Retail-Heavy CMBS

– Like many recent transactions, it is characterized by low leverage, relative to transactions completed this year. And it relies on the inclusion of a pair of relatively high quality loans to boost the overall credit metrics of the pool.

TCF's Fifth Prime Auto ABS of 2016 Is Its Largest to Date

– The $505 million TCF Auto Receivables Owner Trust 2016-PT1 is collateralized by 30,019 contracts issued through partnering dealers and underwritten by its subsidiary, Gateway One Lending & Finance.

New Towd Point Deal Pools Risky GE UK Home Loans

– An £821.7 million pool of higher-risk problem UK residential mortgage loans originated by GE Home Money Lending and other GEHML-affiliated is being pooled into in a new Towd Point Mortgage Trust asset-backed offering arranged through Credit Suisse.

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Featured Articles

Private Student Lenders Got a Huge Boost from Trump's Victory

– No corner of the banking industry has gotten a bigger near-term boost from Donald Trump's election than private student lenders. And that's saying something.

Critics Predict More Woes for Subprime Business Lenders

– The recent shake-up at CAN Capital could spark greater scrutiny of a sector that has drawn comparisons to the bubble-era subprime mortgage market.

Warning Signs in Structured Finance Growing Stronger

– A picture of consistency for several years now, U.S. structured finance is once again set for mostly stable rating performance in 2017. That said, asset performance has peaked in many sectors with modest declines expected over the course of next year.

CMBS Investors Slowly Embracing PACE Financing

– Unlke the residential mortgage market, owners of commercial property typically seek a mortgage lender's consent before obtaining financing for energy efficiency upgrades.

Trump Gives Structured Finance Pros Their Best Shot at Rolling Back Dodd-Frank

– Banking industry lobbyists and representatives are practically salivating over the election results, convinced that Republican control of the White House and Congress will finally give them the opportunity to roll back key parts of the Dodd-Frank Act.

Wall Street Falling in Love with GSE Credit-Risk Transfer Deals

– "It is one of the most exciting innovations in the mortgage market in my career," said Chris Hentemann, chief investment officer at 400 Capital Management, at an Urban Institute housing finance symposium this week.

Latest Usury Law Ruling is Positive for Marketplace Lenders

– In Beecham vs Navient, the U.S. District Court for the Central District of California granted the defendant's motion to dismiss, basing its decision solely on the California usury law exemption for national banks. It declined to review the substance of the loan transactions.

Auto Lending is Losing its Luster for Banks

– Amid shrinking yields, rising delinquencies and repeated warnings from regulators about frothy market conditions, several banks said on earnings calls that they plan to scale back or hold the line on indirect auto lending

What’s So Unusual about Sprint’s Airwaves Securitization

– The wireless carrier, though only rated single-B, has more leeway from existing investors to enter into a transaction like this than even some investment-grade companies, according to Covenant Review.

What’s Really Remarkable about Court Ruling on CFPB

– While attention has focused on the DC Circuit's holding that the CFPB’s organizational structure is unconstitutional, the court made two other critical rulings that put a stop to the CFPB’s aggressive exercise of its enforcement authority.

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Current Issue

What’s So Unusual about Sprint’s Airwaves Securitization … and Why No One Else is Likely to Follow Suit

The wireless carrier, though only rated single-B, has more leeway from existing investors to enter into a transaction like this than even some investment-grade companies, according to Covenant Review.

Current Issue