Private equity investors are turning to collateralized fund obligations, which include some features from the collateralized loan obligation sector. KBRA rated its first CFO last week.

In 2020, the SEC made a move to apply a disclosure rule that had been in effect for nearly 30 years to MBS and ABS. Industry participants have been able to delay enforcement of the rule while seeking changes to the disclosure requirements.

The rating service’s proposal to notch ratings assigned by rival firms when assessing insurers didn’t sit well with the Justice Department, members of Congress and industry participants.

The SEC’s proposal on disclosure requirements and other standards for hedge funds, private equity funds and venture capital funds could have negative impacts for CLOs, SFA and others warn.

All of the participants in the Fed’s TALF program set up in the early days of the pandemic were so-called opportunistic investors that hadn’t previously been buying AAA-rated deals.

ABS issuers and investors are considering whether to use SOFR or Treasury rates as a pricing benchmark following the end of LIBOR reporting.

Some investors in MBS and ABS are ready to discard data collected in the past two years due to distortions from actions by the federal government. One problem: projecting asset performance moving forward.

Issuance of CLOs is surging as investors gain confidence in the asset class. Refinances of deals issued two years ago are also helping.

Although only $4.5 billion of TALF funding was requested during the facility’s pandemic-related course, the Federal Reserve program is credited with stabilizing the ABS market.

Most of the modest gain in bank ABS investment came from a handful of large banks buying deals backed by unsecured consumer loans, a fast-growing market. (Includes two data charts.)