European ABS Pricing and Sectors
The European ABS market has remained mostly quiet over the last four weeks. We have seen spreads slightly tighten, despite the end of the ECB’s rescue program and the ongoing sovereign debt crisis. This movement was helped by a sudden increase of buying activity at the beginning of this week, especially on the most senior tranches of UK non-conforming RMBS, such as Southern Pacific, as well as some CMBS, such as Titan Europe 2007-1.
Granite cash prices have also improved. The AAA, AA, A and BBB bonds, which were trading four weeks ago at 91.7, 73.5, 62 and 42, respectively, now trade at 92.3, 74.25, 63 and 43.
In term of deals being called, we are now pricing all Redevco securities at par. This call seems to be a surprise for investors, especially for recent buyers, as only two ....