Moody's Talks - Securitization Spotlight

High interest rates will weigh on collateral performance in 2024 as structured finance markets adjust to structural shifts, regulatory reforms and geopolitical polarization.

Speaker: Annabel Schaafsma, Global Head of Structured Finance at Moody's Investors Service

Host: Aaron Johnson, Vice President – Research at Moody’s Investors Service

Home price growth has stalled in most major economies globally. However, despite rising wages, housing affordability is weakening after record or near-record house price appreciation in recent years.

Speakers: Rodrigo Conde Puentes, VP-Senior Analyst; Darrell Wheeler, VP-Sr Credit Officer; Si Chen, Analyst

Host: Aaron Johnson, Vice President – Research, Moody’s Investors Service

Various negative macroeconomic trends loom larger for middle market companies than for larger corporates, but the impact on middle market collateralized loan obligations is limited.

Host: Aaron Johnson, Vice President – Research, Moody’s Investors Service

Asset-backed securities exposed to small and medium-sized enterprises remain among the transactions most vulnerable to continued slow economic growth around the globe. How has economic weakness eroded collateral performance thus far and what do we expect for the rest of 2023?

Guests: Sandie Zhang, Analyst – Structured Finance, Moody’s Investors Service; Monica Curti, Vice President – Structured Finance, Moody’s Investors Service; Daniel Gan, Analyst – Structured Finance, Moody’s Investors Service.

Host: Aaron Johnson, Vice President – Research, Moody’s Investors Service.

To read more on this topic, visit Securitization Spotlight page on Moodys.com (some content only available to registered users or subscribers).

Multifamily commercial real estate has performed well of late in both the US and Europe, but will that continue amid high rates and increased scrutiny on buildings energy efficiency?

Guests: Darrell Wheeler, Head of CMBS Research – Structured Finance, Moody’s Investors Service; Brian Snow, Vice President – Structured Finance, Moody’s Investors Service.

Host: Aaron Johnson, Vice President – Research, Moody’s Investors Service.

To read more on this topic, visit Securitization Spotlight page on Moodys.com (some content only available to registered users or subscribers).

Related Links:

• CRE fortunes vary by lender and property type, with office facing multiple risks
• Credit quality erosion to continue as refinancing becomes more difficult
• Sector Update – Q2 2023: Physical office occupancy recovering, but values are down
• Moody's DQT - Office and hotel conduit/fusion DQT increase sharply in June 2023

With Libor’s demise imminent, how prepared are US CLOs to move on from the long-time benchmark?

Guest: Peter Hallenbeck, Vice President, Senior Officer Legal Review – Structured Finance Group, Moody’s Investors Service

Host: Aaron Johnson, Vice President – Research, Moody’s Investors Service

To read more on this topic, visit Securitization Spotlight page on Moodys.com (some content only available to registered users or subscribers).

Related Research:

• Private Credit – Cross Region: Middle-market CLOs, BDCs and closed-end funds: structures lead to divergent credit risks

Moody’s analysts David Burger, Mark Wasden and Neal Epstein explain how differences in structure and asset risk give rise to divergent credit profiles among the three investment vehicles.

Speakers: David Burger, VP – Senior Credit Officer, Moody’s Investors Service; Mark Wasden, Senior Vice President, Moody's Investors Service; Neal Epstein, VP – Senior Credit Officer, Moody's Investors Service

Hosts: Aaron Johnson, VP – Senior Research Writer, Moody’s Investors Service; Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service

As climate change intensifies, how are utility companies using securitization to recover costs related to unforeseen developments like major storms and other natural disasters? And how is the market for these transactions evolving?

Guests: Inga Smolyar, Vice President – Structured Finance Group, Moody’s Investors Service, Tracy Rice, Vice President – Structured Finance Group, Moody’s Investors Service, Natividad Martel, Vice President –  Public Project and Infrastructure Finance Group, and Matthew Kuchtyak, Vice President – Sustainable Finance Group.

Host: Aaron Johnson, Vice President – Research, Moody’s Investors Service.

To read more on this topic, visit Securitization Spotlight page on Moodys.com (some content only available to registered users or subscribers).

Related Research:

• As extreme weather events and net-zero efforts rise, ABS will lower utility credit risk
• Inflation-tied social risk remains low for UCRC ABS despite its rise for utilities
• Second Party Opinion – SCE Recovery Funding LLC's Series 2023-A Assigned SQS2 Sustainability Quality Score            
• 2023 Outlook - Despite weak economy, strong demand for assets will uphold deal credit quality and performance

Jerome Cheng and Tengfu Li discuss how China’s economic rebound will support residential mortgage-backed securities and a handful of Asia-Pacific banking systems with close ties to the country.

Speakers: Tengfu Li, AVP – Analyst, Moody’s Investors Service; Jerome Cheng, Associate Managing Director, Moody’s Investors Service

Hosts: Danielle Reed, VP – Senior Research Writer, Moody’s Investors Service; Aaron Johnson, VP – Senior Research Writer, Moody’s Investors Service

Related content on Moodys.com (may only be available to registered users or subscribers):

• RMBS – China: Economic rebound, low rates and policy support are positive for mortgage borrowers
• Banks – Asia-Pacific: China's reopening will benefit only a few banking systems in Asia-Pacific

Structured finance transactions are exposed to recent banking stresses in the US and Europe at both the collateral and counterparty levels. But will that impact be material? And what kinds of protections do transaction structures provide?

Guests: Edward Manchester, Senior Vice President – Structured Finance Group, Moody’s Investors Service, and Amy Tobey, Senior Vice President – Structured Finance Group, Moody’s Investors Service.

Host: Aaron Johnson, Vice President – Research, Moody’s Investors Service.

To read more on this topic, visit Securitization Spotlight page on Moodys.com (some content only available to registered users or subscribers).