GlobalCapital.com Subscription required SCIO’s chief investment officer Greg Branch discusses how the tougher regulatory stance on securitisation in Europe, coupled with continued cheaper central bank funding, is creating strong opportunities for investors in securitisation further down the capital structure.
SCIO thrives on multi-strategy approach to European structured credit investing, plots liquid European structured credit investing, plots liquid shorter-duration Opportunities fund.
Although the structured finance markets have rallied significantly the firm believes there is a lot further left to go in Europe than in the US.
With large US funds increasingly entering the European secondary ABS market in search of yield, European funds are having to be smarter about sourcing assets. Working with a bank seller to restructure residual positions is emerging as one important option.
The easiest way to source assets in the European secondary ABS market is to be added to BWIC distribution lists, but new US fund entrants tend to become dominating in bid-list activity because they need to deploy larger amounts of cash per month. They also typically focus more on benchmark transactions, buying paper in size.