JPMorgan Chase has issued its first ABS transaction backed by credit card receivables through Chase Issuance Trust since May 2018. A wildcard to the deal, however, is a pending lawsuit involving the issuance trust.
Banks will no longer have to meet extensive disclosure requirements for their MBS deals to receive investor-friendly protections. The change was met with criticism from an Obama appointee to the FDIC’s board.
The $122 million issuance by Oasis Financial will be backed by litigation funding and medical-lien advances related to personal injuries. The deal received a preliminary A- rating.
A $175 million prime auto ABS issued by GTE Federal Credit Union in November was the first rated ABS issued by a credit union. Other deals are likely to follow thanks to revisions made by the NCUA.
To avoid retaining risk in securitization deals, mortgage lenders are joining hands with investors who act as “co-sponsors” and take on the first-loss position.
Issuance of aircraft-related ABS is expected to shoot up in the coming years but industry analysts are warning about potential performance issues. Fitch said it’s taking a cautious approach to rating new deals.
The Structured Finance Association has launched a task force to help the industry incorporate environmental, social and corporate governance practices into the issuance of MBS and ABS.
Fitch warned this week that other rating services are "overstating" the benefits of the structures on whole-business securitizations. The warning comes on the heels of a report from Moody's which carried a positive outlook for the sector.
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