Over Enrolled: How Sallie Mae Manages Growth in its Balance Sheet

By Allison Bisbey

To avoid either running afoul of the FDIC or potentially ceding market share, the bank has to get some of the loans that it makes off its books, either via whole loan sales or securitization

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Latest News

J.P. Morgan's Next RMBS Pools Lower FICOs, Higher LTVs

– Borrowers are slightly weaker than those in deals recently rated by Kroll, though still relatively strong; leverage is also slightly higher, and 11.5% of loans have 10-year interest-only periods.

Cerebus Capital Readies Second Reperforming RMBS

– A portfolio of two loan groups backs the securitization called Towd Point Mortgage Trust 2015-2. One pools approximately 3,121 loans with a balance of $715 million; the other pools 1,289 loans with a balance of $243 million.

Mass Latest State Offering Student Loan Revenue Bonds

– The $184.8 million of notes are expected to be rated ‘AA’ by Standard & Poor’s and ‘A’ by Fitch Ratings. Sizes and maturities of individual tranches have yet to be determined.

J.P. Morgan Plans 6th Credit Card ABS of the Year

– J.P. Morgan plans to issues $600 million of securities backed by credit card receivables via its Chase Issuance Trust, according to an offering circular registered with the Securities and Exchange Commission.


Featured Articles

How to Bring the Student Loan Default Rate Back to Earth

– Student loan borrowers are in serious need of better communication with loan servicers and clearer information about their servicing options, regulators were told last week.

Key CMBS Investors Push Back Against Poor Underwriting

– A select group of investors that buy the riskiest slices of commercial mortgage securitizations have lost their appetite for the very worst offending loans.

Nonbank Lenders Usurp Banks as Ginnie MBS Leaders

– As major banks have pulled back from originating Federal Housing Administration single-family loans, nonbank mortgage lenders have become bigger players in the Ginnie Mae program.

How Solvency II Might Hit Demand for U.S. Asset-Backeds

– Analysts from the bank are scratching their heads over the regulatory treatment for European insurers investing in U.S. asset-backeds directly or through funds. Their advice to regulators: postpone Solvency II until 2017.

Fitch: CLO Risk Retention Plans Aren’t ‘One Size Fits All’

– A survey of some 50 managers of collateralized loan obligations indicates that just over 40% plan to employ the “horizontal” strategy and nearly 35% to employ the “vertical” strategy; many will decide on a deal-by-deal basis.

Expansion Comes at a Price for Marketplace Lenders

– Marketplace lenders are still enjoying spectacular growth, but tough questions are starting to emerge about how much money these burgeoning firms will have to spend to continue boosting their loan volumes.

Bundling Assets May Unlock Solar ABS Potential

– Smaller solar power developers would be able to tap the securitization market if they could bundle leases or purchase agreements for installing solar panels into a single deal, said industry players at IMN's 3rd Sunshine-Backed Bonds Conference.

High LTV Lending Is Actually a Good Thing

– It is a reflection of the mortgage giants' confidence in obtaining a clear and early understanding of valuations.

CLO Market's Wild Ride May Be Near an End

– CLO issuance has been surprisingly robust in 2015 – but as many industry participants observed at an industry conference in New York last week, it’s likely that the market will be tapping the brakes before the year is out.

CRE CLOs Mounting a Post-Crisis Comeback in U.S.

– The new securities come with stronger protections and a slightly different name than the CRE CDO label — a reference to collateralized debt obligations.

Credit Suisse is Playing it Safe on Risk Retention with CLOs

– Rather than wait and see whether deals otherwise grandfathered can be refinanced after December 2016 without triggering compliance, it is issuing new deals with shorter non-callable periods.

Why Marketplace Lenders May Snuff Out Credit Cards

– These companies are targeting the most lucrative credit card customers: people with large revolving balances paying interest rates in the high double digits.


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How CLO Managers Are Preparing for Risk Retention

It's one of the biggest regulatory hurdles the market has faced since the financial crisis, and promises to bring wholesale changes to the structures of transactions as well as to the business models of managers. Clifford Chance partner Steven Kolyer weighs in.

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