September 2, 2015 Newsletter
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September 2, 2015
 
SFIG News

Industry Jobs

SFIG Calendar

Meetings

Events

Advocacy Outlook

Industry News Highlights

 
SFIG NEWS
SFIG MEETS WITH SEC COMMISSIONER STEIN'S OFFICE ON HQS

On Friday, August 28th, SFIG staff and members met with the office of Securities and Exchange Commission (“SEC”) Commissioner Kara Stein to discuss high quality securitization (“HQS”). The meeting was SFIG’s first with Commissioner Stein’s office, following a meeting with SEC staff earlier in the week and reported in our last newsletter.  Our discussion with Commissioner Stein’s office reflects SFIG’s effort to engage U.S. policy makers as the European Union moves to implement their own framework for simple, transparent and standardized (“STS”) securitizations. SFIG shared members’ concerns about draft EU legislation establishing an STS framework—which would reportedly include modified rules on transparency, due diligence and risk retention—and amending the Capital Requirements Regulation to provide for capital relief for senior STS transactions.

For questions about the meeting, please contact Sairah.Burki@sfindustry.org. To join the HQS Task Force and contribute to SFIG’s advocacy on this topic, please contact Amanda.Bateman@sfindustry.org.

 
 
SAY HELLO TO OUR NEW STAFF MEMBER!

SFIG is pleased to welcome Sarah Clarke, our newest staff member. Sarah will be joining SFIG as Executive Administration. She recently moved to the Washington D.C. area from Chicago, where she worked as an Executive Assistant for a private wealth management firm. She earned a Bachelor of Science in Health Administration from the University of Central Florida.

 
 
INDUSTRY JOBS

Current open positions at SFIG include:

  1. Director of Mortgage Policy: will lead all initiatives related to mortgage-backed securitization. This is a high profile position within the SFIG leadership team working directly with executive management, the Board of Directors, Committee Chairs and key members of SFIG’s membership. Additional information on the position, as well as a link to the application, is available here.

  2. Communications and Media Manager: will be an integral member of SFIG staff, providing support across the whole organization and serving as a vital link between SFIG, its membership and other external audiences. Additional information on the position, as well as a link to the application, is available here.

Some of the latest industry positions available include:

JOB TITLE   COMPANY POSTING DATE
Consumer ABS Analysts   Kroll Bond Rating Agency, Inc. 8-19-15
Senior Vice President, RMBS Monitoring   Moody’s Corporation 8-18-15
Associate Analyst 1   Moody’s Corporation 7-29-15
Vice President, Senior Credit Officer (ABS Surveillance)   Moody’s Corporation 7-31-15
Associate Analyst 3   Moody’s Corporation 7-29-15
Associate Analyst 1   Moody’s Corporation 7-28-15
Capital Markets Associate   Cadwalader, Wickersham & Taft LLP 7-21-15
Director - Credit Process Management   Fitch Ratings 7-09-15
Associate Director / Director, Asset Backed Securities   Fitch Ratings 7-08-15
Mid-level Asset Securitization Associate Attorney   Chapman and Cutler LLP 7-01-15

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

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

 
 
SFIG CALENDAR
MEETINGS
WEEKLY CREDIT CARD ISSUER COMMITTEE CALLS
  • THURSDAY, September 3, 2015
    10:00 a.m. – 11:00 a.m. (ET)

  • THURSDAY, September 10, 2015
    10:00 a.m. – 11:00 a.m. (ET)
 
 
CREDIT CARD ISSUERS - INVESTORS CONFERENCE CALL
TUESDAY, September 8, 2015
1:30 p.m. – 3:00 p.m. (ET)
 
 
BOARD OF DIRECTORS' MEETING
THURSDAY, September 10, 2015
12:00 p.m. - 5:00 p.m. (ET)
 
 
CHINESE MARKET COMMITTEE CALL
FRIDAY, September 11, 2015
8:30 a.m. – 9:30 a.m. (ET)
 
 
EVENTS
IMN’s ABS EAST 2015 CONFERENCE
WEDNESDAY, September 16, 2015 – FRIDAY, September 18, 2015
The Fontainebleau
Miami Beach, FL
Registration is available here
  • Richard Johns will speak on the “High Quality Securitizations” panel
  • Sairah Burki will speak on the “Assessing The Impact of Regulatory Reform on ABS Market Liquidity” panel
  • Michael Flood will speak on the “Single Asset/Single Borrower CMBS” panel
  • SFIG will also sponsor a “Women in Securitization” panel
 
 
SFIG DC SYMPOSIUM: MARKETPLACE LENDING PANEL DISCUSSION

TUESDAY, October 6, 2015
5:30 – 8:00 p.m. (ET)
Chapman and Cutler LLP
1717 Rhode Island Avenue NW
Washington, DC 20036
Please click here to register. Full agenda will be forthcoming.

Please note, this event is closed to the press

 
 
SFIG FALL SYMPOSIUM

THURSDAY, October 8, 2015
5:00 – 8:00 p.m. (ET)
PricewaterhouseCoopers LLP
300 Madison Avenue
New York, NY 10017
Please click here to register. Full agenda will be forthcoming.

Please note, this event is closed to the press and seating priority will be given to SFIG members.

 
 
ASIFMA STRUCTURED FINANCE CONFERENCE 2015

WEDNESDAY, October 14, 2015 – THURSDAY, October 15, 2015

Workshop: Clifford Chance's Office, Hong Kong
Main Conference: Conrad Hong Kong, Grand Ballroom, Lower Lobby, Hong Kong

  • Sairah Burki will speak at the "Developments in the US/EU Securitization and Covered Bonds Markets” workshop
  • Richard Johns will be a discussion leader on the "Impact of European Regulation (AIFMD, CRD II/IV, CRA3) and US Regulation (Volker, Dodd-Frank and Commodity Pool Operator)" roundtable

More information on the conference can be found here

 
 
IMN’s INVESTORS’ CONFERENCE ON MARKETPLACE LENDING

THURSDAY, October 29, 2015
Marriott New York Downtown
New York, NY
Registration available here

 
 
SFIG & IMN’s PRIVATE LABEL RMBS REFORM SYMPOSIUM

THURSDAY, November 12, 2015
Marriott New York Downtown
New York, NY
Registration available here

 
 
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's first initiative will be to respond to the Treasury Department's Request for Input on Online Marketplace Lending due September 30th. Peter Manbeck and Marc Franson of Chapman and Cutler LLP are serving as drafting counsel.

Members interested in participating should contact Amanda.Bateman@sfindustry.org.

SFIG has recently formed a Student Loan Working Group to focus on and respond to the Proposed Changes to Moody’s Approach to Rating Securities Backed by FFELP Student Loans.

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

The RMBS 3.0 Task Force released its Second Edition RMBS 3.0 Green Paper in November of 2014. Following the successful SFIG/IMN Private Label RMBS Symposium, the task force will continue 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; and (3) Role of Transaction Parties and Bondholder Communications. Presently, the task force is working on (1) developing a comprehensive compilation of representations and warranties for release in the fall of 2015 and (2) a grid summarizing roles of transaction parties. We encourage members to participate in any or all of the working groups to contribute towards the mission of RMBS 3.0.

For additional information on RMBS 3.0, or to join the task force, please contact Mary.Robinson@sfindustry.org.

The GSE Reform Task Force reviewed a draft response to the FHFA’s update to the single security initiative earlier this month. The task force also received an update from the SFIG participants on the Industry Advisory Group for the Common Securitization Platform and Single-Security. The task force has also formed policy positions on the Carney-Delaney-Himes GSE Reform bill and updated its briefing book to support its advocacy efforts. With the release of the bill, SFIG staff also updated its GSE Reform Legislative Comparison, which analyzes key provisions in the five most recent housing finance reform bills including the Johnson-Crapo bill and the PATH Act. Additionally, the task force will continue to engage the Federal Housing Finance Agency on its Single-Security proposal, guarantee fee pricing and Strategic Plan for 2015-2019.

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

The Mortgage Loan-Level Disclosure Task Force is studying the recent Regulation AB II release of Schedule AL and comparing it to SFIG’s Schedule L submission to the Securities and Exchange Commission in February 2014. SFIG also continues to have weekly Mortgage Industry Standards Maintenance Organization calls to go through data elements that lenders should deliver in securitizations. We will also be conducting an analysis of the data elements included in SFIG’s Schedule L submission in order to determine any privacy concerns.

Please contact Alyssa.Acevedo@sfindustry.org for additional information on SFIG’s work on this topic.

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 Amanda.Bateman@sfindustry.org to participate on the Volcker Task Force.

The Risk Retention Industry Guide Work-stream is 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 continues to hold discussions with a focus on SFIG’s partnership with the Chinese Securitization Forum, 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.

SFIG’s Shadow Banking Task Force has established the following agenda:

  • Leverage the predictive powers of the G20’s shadow banking initiative to determine future SFIG advocacy initiatives
  • Assess the level of regulation to which our members are already subject
  • Measure the full impact of those regulations on lending decisions and business models
  • Provide input into IOSCO, BCBS and IAIS on the revitalization of securitization markets

The task force will have its first full meeting in the coming weeks, and members from across asset classes are encouraged to participate.

To register for SFIG’s Shadow Banking Initiative, please contact Amanda.Bateman@sfindustry.org.

The Regulation AB II Task Force will focus on the disclosure and offering process requirements within the final rule. Two work streams have been formed to develop a comment letter on the proposed rules that remain outstanding and to produce an industry guide for critical elements of the final rule.

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 is addressing industry concerns related to the Federal Reserve Board’s Final Rule on the Liquidity Coverage Ratio (“LCR”). This committee will also develop a comment letter when U.S. regulators release their proposed Net Stable Funding Ratio (“NSFR”).

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.

SFIG members who are interested in learning more about this initiative should email Amanda.Bateman@sfindustry.org.

The Money Market Fund Reform Working Group submitted a comment letter on October 13, 2014 regarding the Securities and Exchange Commission’s July 23, 2014 proposal which includes, among other things, possibly amending rule 2a-7’s issuer diversification provisions to eliminate an exclusion that is currently available for securities subject to a guarantee issued by a non-controlled person. SFIG also submitted a comment letter in September 2013 on Money Market Fund Reform.

If you are interested in joining this working group, please contact Alyssa.Acevedo@sfindustry.org.

The High Quality Securitization ("HQS”) Task Force 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.

To join the HQS Task Force, please contact Amanda.Bateman@sfindustry.org.

 
 
INDUSTRY NEWS HIGHLIGHTS
MORTGAGE SERVICERS RESUME SECURITIZATION OF ADVANCE REIMBURSEMENTS

Residential mortgage servicers have resumed the securitization of advance reimbursements relating to principal and interest advances to bondholders and protective advances, according to a recent National Mortgage News article.

The issuance of term securities backed by advance reimbursements came to a halt in April of 2014 when Standard & Poor’s (“S&P”) announced it was revising its criteria for evaluating risk in deals. As a result, servicers had to rely on private, unrated deals or shorter-term variable funding facilities. The revised criteria were ultimately published in October of 2014 and the first rated deals utilizing the new criteria have come to market in the last few weeks.

According to the article, the new deals have new features to address S&P's recalibrated rating methodology, which takes into account the potential for extended timelines for reimbursements, the liquidity risk of the notes under stressed conditions and the servicer's ability to continue advancing based on its credit quality.

 
 
NON-CONFORMING RMBS ARREARS IMPROVE IN SECOND QUARTER
According to an article in Mortgage Finance Gazette, severe arrears in Standard & Poor’s RMBS index fell among non-conforming transactions to 12.8 percent in the second quarter, down 0.5 percent from the first quarter. RMBS transactions also showed signs of improvement in the residential rental market. For prime RMBS transactions, overall arrears at 3.3 percent remained stable from the last quarter. As stated in the article, “[t]he decline in arrears was helped by a combination of factors, including an improvement in the labor market, solid economic growth, and low interest rates.” The economy is expected to keep growing through the end of the year, according to S&P, and will be driven by increasing household consumption and business investment.
 
 
BANK OF ENGLAND PUBLISHES CONCERNS REGARDING BOND LIQUIDITY

Regulations aimed at making banks safer may have had a destabilizing effect on the bond market, according to a recent Bank of England (“BoE”) analysis published on its Bank Underground blog.

The BoE reported an increase in banks’ cost of capital, partly due to the imposition of new regulation, has caused the banks to retreat from trading and reduce the size of their balance sheets, particularly with respect to corporate bonds.

Within the BoE’s analysis, responses of market prices and dealer inventories to changes in asset manager demand were modeled. The analysis found that in the pre-crisis period, dealers would increase their holdings of bonds by 1.5 basis points of outstanding market value when manger demand fell sharply. In the post-crisis period, this fell to just 0.2 basis points. These findings are “consistent with dealers’ intermediation capacity having fallen, leading to greater volatility in market prices,” according to the blog.

 
 
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

Michael Flood Director of Advocacy

Jennifer Wolfe ABS Policy Manager

Mary Robinson Policy Manager

Alyssa Acevedo Senior Analyst, ABS Policy

Amanda Bateman Policy Analyst

Daniel Tees Policy Analyst

Jennifer Serpas Office Manager

Allison Creswell Events Coordinator

Sarah Clarke, Executive Administration

1775 Pennsylvania Ave. NW
Suite 625
Washington, DC 20006

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