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CFOZone Experts

Opinions and views from expert CFOZone members.

Tag >> ABS
Sep 28

Securitization: don't take it for granted

Posted by dbedell in SIVsecuritizationRiskRepo 105EnronDealsasset backedarbitrageABS


Securitization, at its most basic, is a sound financing technique. This is my basic tenet for today’s blog. With the ABS markets again beginning to pick up, spreads tightening and investor demand growing but supply still limited, it is time for a revisit of just what makes this market so important from a corporate perspective, and why it is way-past time for stakeholders to get it right in rebuilding the market.

I am not here to argue the validity of the regulatory arbitrage that drove the market to such great heights before the crisis. In fact, that is most definitely one of the things that should be addressed as the new world of securitization takes shape. What I am here to argue is the validity and soundness of securitization at its most basic, as a financing structure for corporates.

Aug 31

ABS regulatory murk hurts issuance

Posted by dbedell in Securities and Exchange Commissionregulatory frameworkFDICDodd-FrankDealsasset backedABS


The FDIC and SEC are working hard to enact government-mandated regulatory reform for the US ABS markets as called for in Dodd-Frank. However, the two agencies, along with four other agencies that oversee the ABS markets in some way, each have proposed specific guidelines that interpret how market reform should be implemented.

Jul 26

Ford Motor Credit pulls ABS deal

Posted by dbedell in ToyotaSecurities and Exchange CommissionFord Motor CreditDealscredit-rating agenciesasset backedABS


The impact of regulatory reforms signed into law last week is already being seen in asset-backed securities, as Ford Motor Credit pulled an ABS deal last week after the major rating agencies confirmed that they will not allow their ratings to be used in bond prospectuses for such securities—thanks to changing liability under the regulatory overhaul.

The regulations set new liabilities for ratings agencies that consent to allow their ratings to be used in public ABS offering prospectuses. Under the new law, ratings firms are subject to “expert liability”—which means that they will have the same liability and legal risks as accountants and others specialists that are involved in bond sales, as Marine Cole reported in her blog last week.

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