September 15,  2016 Newsletter
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September 15, 2016
 
 
SFIG News

Industry Jobs

SFIG Calendar

Meetings

Events

Advocacy Outlook

Industry News Highlights

 
SFIG NEWS
STILL TIME TO REGISTER: SFIG SUNDAY TRACK AT ABS EAST THIS WEEKEND

Don’t miss SFIG’s series of updates on some of the most current and pressing advocacy issues facing the securitization market and how the industry is responding. Join us at ABS East on Sunday, September 18th, from 12:30PM – 4:30PM (Track C) to hear these important industry updates. If you would like to attend these panels, please email melissa.igbineweka@imn.org.

SUNDAY, September 18, 2016
Track C

12:30pm – 1:15pm:
RMBS 3.0 – Returning Private Capital to the Mortgage Market
          Daniel Goodwin (SFIG) & Eric Kaplan

1:15pm – 2:00pm: Marketplace Lending
          Jennifer Wolfe (SFIG) & William Black

2:15pm – 3:00pm:
Q4 2016 SFIG Investor Agenda and 2017 agenda
          Kristi Leo (SFIG) & SFIG Investor Cabinet

3:00pm – 3:45pm:
Investor Liquidity Review – The Path Forward
          Kristi Leo (SFIG) & SFIG Investor Cabinet

3:45pm – 4:30pm: Reg AB/Disclosure
          Alyssa Acevedo (SFIG) & Charles Sweet

Please be advised that these sessions are closed to press.

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SFIG INVESTORS SUBMIT RESPONSE TO MOODY’S RFC ON RATING RENTAL FLEET ABS

On Monday, September 12th, SFIG’s Investor Committee submitted a response to Moody’s Request for Comment (RFC) on their proposed methodology update for rental fleet securitizations.

The RFC proposed to update how Moody’s estimates or addresses certain risk factors, such as the disposal value calculation, fleet composition, sponsor probability of default, and correlation, leaving the general framework they use to evaluate rental fleet securitizations unchanged.

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SFIG MEETS WITH FEDERAL RESERVE ON SINGLE COUNTERPARTY CREDIT LIMITS

Last Friday, September 9, 2016, SFIG staff and members met with officials at the Federal Reserve Board to discuss the proposed rule on Single Counterparty Credit Limits to which SFIG provided comment in June 2016. SFIG welcomed the opportunity to follow up on our response with an in-person meeting, which allowed members to answer questions about our letter, including the specific recommendations included in our response. SFIG coordinated our response through the Regulatory Capital & Liquidity Committee and ABCP Committee. If you are interested in our advocacy on this issue or joining the committee, please contact Alyssa.Acevedo@sfindustry.org.

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SFIG PUBLISHES RISK RETENTION INDUSTRY GUIDE

Yesterday, September 13th, SFIG published its latest Industry Guide, this one focused on the Risk Retention rule.

Our Industry Guide initiative seeks to contribute to market openness and transparency via a series of guides that reflect “general consensus” opinions of members interested in those particular regulatory rulemakings.

For more than a year, the SFIG Risk Retention Industry Guide Working Group, including, but not limited to, issuers, investors, lawyers, accountants, trustees, and underwriters, have worked together to define a consistent approach to interpretation and implementation of the Risk Retention rule.

This guide is the third in SFIG’s series of industry guides, following the release of our NRSRO Industry Guide in June of 2015 and our interim Risk Retention Industry Guide in December of 2015, ahead of the RMBS compliance date.

Developed under the leadership of Julie Gillespie of Mayer Brown, the views set forth in the Industry Guide do not constitute legal advice but instead reflect industry views and consensus positions on the questions presented based on various resources and numerous group discussions. All of the views set forth in the Industry Guide are subject to change as market practices develop and/or if additional guidance from the regulatory agencies becomes available. While presented as a consensus, we would highlight that the guide does not purport to represent that all viewpoints have been universally adopted by every SFIG member. 

Please contact Sairah.Burki@sfindustry.org, Jennifer.Wolfe@sfindustry.org, or Alyssa.Acevedo@sfindustry.org with any questions.

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NO NEWSLETTER DISTRIBUTION NEXT WEEK

SFIG will not be publishing a newsletter next week. We look forward to seeing you all in Miami at the ABS East 2016 conference from September 18th-20th. Newsletter publications will resume on September 29th. We are proud to announce that we will also be rolling out a new weekly newsletter design then.

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INDUSTRY JOBS

SFIG Positions

Are you or someone you know eager to join a supportive, hard-working and fun nonprofit team doing incredible work? Good news, SFIG has several openings! Please see the below job opportunities and help us spread the word by passing them along to anyone who might be a good fit:

  • Director of Education: will be responsible for the strategic development and execution of a comprehensive and robust in-person and online education and member development program.
  • RMBS/CMBS Policy Manager: will contribute to the design of, and help execute group-wide strategy efforts and initiatives in support of SFIG’s mortgage policy priorities.
  • Manager of Advocacy: will design and execute advocacy strategies, engage with Capitol Hill and federal regulatory agencies as well as support SFIG’s advocacy efforts through development and growth of its political action committee.
  • Policy Analyst: will support general policy initiatives and investor relations through direct member engagement, meeting facilitation, research and analysis.

You can also follow our Twitter @SFIndustryG at https://twitter.com/SFIndustryG to stay updated on all SFIG job opportunities.


Industry Positions

Some of the latest industry positions available include:

JOB TITLE COMPANY POSTING DATE
Analyst/Associate Director - Asset Backed Securities Fitch Ratings 07-15-2016
Director/Senior Director - Asset Manager Leader Fitch Ratings 05-03-2016
Director/Senior Director - Research and Criteria Leader Fitch Ratings 05-03-2016

Please visit our Jobs page for a full listing of available positions.

Current members are encouraged to advertise open positions within their company on SFIG's website by filling out the form here.

For questions about positions at SFIG, please contact Jobs@sfindustry.org. For questions about the website jobs portal, please contact Website@sfindustry.org.

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SFIG CALENDAR
MEETINGS
EQUIPMENT ISSUER COMMITTEE CALL

MONDAY, September 19, 2016
2:00 p.m. – 3:00 p.m. (ET)

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RISK RETENTION INDUSTRY GUIDE CALL

TUESDAY, September 20, 2016
11:00 a.m. – 12:00 p.m. (ET)

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SFIG BOARD OF DIRECTORS MEETING

THURSDAY, September 29, 2016
12:00 p.m. – 5:00 p.m. (ET)
Katten Muchin Rosen LLP
New York, NY
Note: Closed Meeting

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EVENTS
WiS MIAMI REGATTA AT ABS EAST 2016

SUNDAY, September 18, 2016
3:00 p.m. – 5:00 p.m. (ET)
Eden Roc Hotel, Ocean Tower Ballroom II
Miami Beach, FL
Registration available here.

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SFIG SUNDAY ADVOCACY TRACK AT ABS EAST 2016

SUNDAY, September 18, 2016
12:30 p.m. – 4:30 p.m. (ET)
Please note special sessions require advanced attendance which may be confirmed with Melissa Igbineweka at melissa.igbineweka@imn.org.

These sessions are closed to the press.

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IMN’s ABS EAST 2016 CONFERENCE

SUNDAY, September 18, 2016 – TUESDAY, September 20, 2016
The Fontainebleau
Miami Beach, FL
Registration available here.

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NEW YORK CITY BLOCKCHAIN SYMPOSIUM

TUESDAY, October 4, 2016
5:00 p.m. – 7:00 p.m. (ET)
Ernst & Young LLP
New York, NY
Registration available here.

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WASHINGTON, D.C. BLOCKCHAIN SYMPOSIUM

THURSDAY, October 6, 2016
5:00 p.m. – 7:00 p.m. (ET)
Venable LLP
Washington, D.C.
Registration available here.

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SFIG VEGAS 2017 CONFERENCE

SUNDAY, February 26, 2017 - WEDNESDAY, March 1, 2017
Aria Resort & Casino
Las Vegas, NV
Registration available here.

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ADVOCACY OUTLOOK

If you would like to participate in the work SFIG is undertaking through our committees as highlighted below, please e-mail Committees@sfindustry.org. For specific inquiries on any of SFIG’s advocacy efforts, please contact the staff member listed for the related project.

SFIG’s Marketplace Lending Committee was established in August 2015, as an SFIG participant committee and is open to all SFIG members who have a legitimate interest in marketplace lending. The committee was formed with two primary intentions: 1) to work with members involved in marketplace lending to educate the industry as a whole, with a particular focus on the securitization of assets generated through that lending channel; and 2) to determine appropriate securitization-specific policy and engage in related advocacy, leveraging SFIG’s prominence and experience across all asset classes to support the continued responsible growth of securitization in marketplace lending.

The committee recently launched its “Best Practices” initiative to establish industry consensus and provide recommendations around one or multiple accepted approaches. The five established Best Practices work streams are 1) Data & Reporting 2) Representations & Warranties 3) Regulatory 4) Operational Considerations and 5) Enforcement.

The committee previously commented on the Treasury Department's Request for Input on Online Marketplace Lending on September 30, 2015.

SFIG’s Student Loan Committee responded to Fitch’s proposed amendments to FFELP student loan ABS rating methodology earlier this year. The committee also submitted a response to the Proposed Changes to Moody’s Approach to Rating Securities Backed by FFELP Student Loans in October 2015.

To join SFIG’s Student Loan Committee and learn more, please contact Alyssa.Acevedo@sfindustry.org.

The RMBS 3.0 Task Force released its Third Edition RMBS 3.0 Green Papers in November 2015. The task force has continued its efforts to address key issues specific to private label mortgage securities through work-streams relating to 1) Representations, Warranties, and Repurchase Enforcement; 2) Due Diligence, Data, and Loan-Level Disclosure; 3) Role of Transaction Parties; and 4) Bondholder Communications. We encourage members to participate in any or all of the working groups to contribute towards the mission of RMBS 3.0. For its 2016 agenda, the task force will address topics including the inclusion of an independent Deal Agent in transactions, Bondholder Communications, Data and Loan-Level Disclosure, Repurchase Enforcement, and Settlements, as well as undertake a review of the previously published Green Papers.

For additional information on RMBS 3.0, please contact Marshall.Bornemann@sfindustry.org.

In response to a request for public comment issued by FHFA on the GSEs’ credit risk transfer processes, SFIG, through its GSE Reform Task Force, convened a call on July 7th to gauge membership’s interest. The task force is currently working on a response to be submitted no later than October 13, 2016.

To join SFIG’s GSE Reform Task Force and learn more, please contact Marshall.Bornemann@sfindustry.org.

The Mortgage Loan Level Disclosure Task Force will soon begin its review of the Mortgage Industry Standards Maintenance Organization’s (MISMO) work to map the data elements that lenders should deliver in securitizations per the recent Regulation AB II release of Schedule AL. The requirements will come into effect in November 2016, and SFIG has participated in weekly conference calls with MISMO for the last 18 months in an effort to standardize disclosure by that time. SFIG encourages subject-matter experts from member organizations to participate in its review—which will be conducted jointly by this task force and the RMBS 3.0 Due Diligence, Data and Disclosure Working Group—so the work can be adopted as an industry-wide standard.

Members interested in participating should contact Marshall.Bornemann@sfindustry.org.

The Volcker Task Force has been working with SFIG’s various asset class and legal counsel committees to identify areas within the Volcker Rule in need of clarification, particularly questions regarding covered funds and the loan securitization exemption.

Please contact Alyssa.Acevedo@sfindustry.org to participate on the Task Force.

The Risk Retention Industry Guide Working Group launched its interim Industry Guide, ahead of the RMBS compliance date, focused on issues either relevant to all asset classes or specific to RMBS. The Working Group continues to work on a final guide focused on creating best practices and developing consensus positions around several areas within the Credit Risk Retention final rule.

Please contact Alyssa.Acevedo@sfindustry.org with any questions.

SFIG’s Chinese Market Committee completed their White Paper, A Comprehensive Guide to U.S. Securitization, in April for Chinese regulators and the Chinese Securitization Forum to educate them on the U.S. securitization landscape. The committee also continues to hold discussions with a focus on SFIG’s partnership with the CSF, potential upcoming educational discussions and the sharing of recent market developments in China.

If you would like more information on SFIG’s work with respect to Chinese securitization, please contact Alyssa.Acevedo@sfindustry.org.

The Regulation AB II Task Force has been focused on the disclosure and offering process requirements within the final rule. Asset specific work streams have been formed to develop comment letters on the outstanding proposals within the final rule and the Task Force submitted the first part of its comment letter in June of 2015. SFIG submitted a supplemental comment letter covering credit card and equipment floorplan asset classes on January 12, 2016 and another supplemental comment letter regarding asset-level information for student loans on June 15, 2016.  Future discussions across asset class committees and the Regulation AB II Task Force will focus on the remaining outstanding proposed rules, including potentially requiring issuers to provide the same disclosure for Rule 144A offerings as required for registered offerings.

SFIG members who are interested in joining this task force or asset specific committees should contact Alyssa.Acevedo@sfindustry.org

The Regulatory Capital and Liquidity Committee recently submitted a response to the U.S. proposed net stable funding ratio (NSFR) requirements. The committee also recently submitted comments to the Federal Reserve Board’s (FRB) proposal regarding Single-Counterparty Credit Limits, and before that, submitted a response to Basel’s Consultative Document regarding Capital Treatment for STC Securitisations. The committee will be addressing industry concerns related to the FRB’s Final Rule on the Liquidity Coverage Ratio (LCR). SFIG testified before Congress in February 2016, focusing on global regulatory issues, including LCR, that affect lending across all asset classes.

To become involved in SFIG’s advocacy on the final LCR or NSFR rules, please contact Alyssa.Acevedo@sfindustry.org.

The Derivatives in Securitization Task Force obtained no-action relief from the CFTC giving swap dealers comfort that the CFTC would not take enforcement action against swap dealers that did not comply with certain CFTC Regulations when taking actions in response to the credit ratings downgrade of a counterparty to a legacy swap. The relief applies to swaps with SPVs that were in existence prior to October 10, 2013. The task force also commented on the CFTC’s proposal on margin requirements for uncleared swaps, as well as the prudential regulators’ proposal regarding margin and capital requirements for covered swap entities. In October 2015, the prudential regulators approved a Joint Final Rule on Swap Margin Requirements. In November 2015, the CFTC issued their final rule regarding margin requirements for uncleared swaps for swap dealers and major swap participants.

The High Quality Securitization (HQS) Task Force submitted a response to Basel’s Consultative Document regarding Capital Treatment for STC Securitisations in February 2016. The task force previously responded to the European Commission’s consultation on an EU framework for simple, transparent and standardized securitization on May 12, 2015. The task force also previously responded to the BCBS-IOSCO consultation on its criteria for identifying simple, transparent and comparable securitizations. SFIG’s comments were built off of those sent to the European Banking Authority on January 14th (available here) regarding its proposed criteria and to the European Central Bank and Bank of England last summer (available here) regarding the development of a sustainable securitization market in Europe. SFIG testified before Congress in February 2016, focusing on global regulatory issues, including HQS, which affect lending across all asset classes.

To join the HQS Task Force, please contact Alyssa.Acevedo@sfindustry.org.

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INDUSTRY NEWS HIGHLIGHTS
CENTRAL BANKERS: BASEL III ON TRACK WITH CAPITAL RULES

This past Sunday, September 11th, the Group of Central Bank Governors and Heads of Supervision (GHOS), whose members include the Federal Reserve, the Bank of England and the European Central Bank (ECB), met to review progress so far on finalizing the Basel III reforms ushered in by the financial crisis, according to a recent Reuters article.

"The GHOS endorsed the broad direction of the Committee's reforms," it said in a statement.

"The GHOS discussed the Basel Committee's ongoing cumulative impact assessment and reaffirmed that, as a result of this assessment; the committee should focus on not significantly increasing overall capital requirements."

"Finalizing the committee's post-crisis reforms will complete Basel III and help restore confidence in banks’ risk-weighted capital ratios," said Mario Draghi, who heads the ECB and chairs GHOS.

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S&P GLOBAL RATINGS RELEASES NPL SECURITIZATIONS RATING FRAMEWORK

According to a recent press release by S&P Global Ratings, the rating agency revised their criteria for evaluating “all new and existing ratings on securitizations supported by asset portfolios” comprised of non-performing loans, or NPLs.

S&P’s analytical framework is based on five principles used to determine NPLs ratings. Specifically, credit quality, legal and regulatory risks, administrative risks, payment structures, and inherent risks to counterparties. Although S&P Global revised its framework, it expects that “the criteria will have no impact on our outstanding rating on NPL securitizations.”

To become involved in SFIG’s MBS matters, please contact Marshall.Bornemann@sfindustry.org.

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HOUSE FINANCIAL SERVICES COMMITTEE PASSES DODD-FRANK REFORM LEGISLATION

On Tuesday, September 13th, the House Committee on Financial Services passed H.R. 5983, the Financial CHOICE Act of 2016, by a final vote of 30-26 with committee members voting almost entirely along party lines.

According to an article in the Wall Street Journal, the Committee’s Chairman, Rep. Jeb Hensarling (R-TX), introduced the legislation with the stated goal of rolling back Dodd-Frank and putting in place a “21st Century model” for banking regulation. The article also pointed to the bill’s key provision as a regulatory “off ramp” for banks to choose an “alternative regulatory arrangement” allowing them to avoid certain regulatory burdens.

During opening statements at Committee’s markup, Democrats expressed their vehement opposition to the bill and the process. The Committee’s Ranking Member, Rep. Maxine Waters (D-CA) called the bill a “highly partisan, damaging piece of legislation to kill Dodd-Frank and harm consumers.” Following her objections, Rep. Waters called for a vote on H.R. 5983, noting that no Democratic amendments would be offered. While the bill passed the committee, prospects for its further consideration in Congress remain unclear.

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VENTURE CAPITAL BLOCKCHAIN INVESTMENTS APPROACH $300 MILLION THIS YEAR

According to a recent Blockchain News article, the total value of Venture Capital investment into Blockchain technologies and Bitcoin companies totaled $290 million in the first six months of this year.

A recent Juniper Research report highlighted the increasing diversification of nascent Blockchain deployments. The report also identified the banking sector as being particularly proactive and stated that, in areas such as transaction settlement, the introduction of a Blockchain-based system would substantially reduce both the risk of error and the time taken for error checking, according to Blockchain News.

If you would like to learn more about or join SFIG’s Blockchain Task Force, please contact Alyssa.Acevedo@sfindustry.org.

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SFIG COMMITTEES AND TASK FORCES

SFIG has a number of Committees and Task Forces meeting and working on many topics of interest to the securitization industry. Please email us for more information, including how to join.

SFIG is pleased to share this edition of its newsletter with our members, as well as our supporters in the structured finance community. To ensure that you receive future editions of the newsletter, please visit our website or email us to learn more about membership opportunities.

Contact Information

Richard Johns Executive Director

Kristi Leo Investor Relations

Sairah Burki Senior Director, ABS Policy

Dan Goodwin Director, Mortgage Policy

Tom McCrocklin Director, Advocacy

Jennifer Wolfe Manager, ABS Policy

Hua Liu Communications & Social Media Manager

Alyssa Acevedo Senior Analyst, ABS Policy

Marshall Bornemann, Policy Analyst

Robert Robilliard, Data and Policy Analyst

Jennifer Serpas Office Manager

Sarah Clarke Events Coordinator

Dani Hernandez Executive Administration

1775 Pennsylvania Ave. NW
Suite 625
Washington, DC 20006

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