Feb 07 - Fitch Ratings says its forecast for EMEA structured finance issuance in 2013 is for broadly similar volumes compared to 2012, at around EUR200bn. 2012 was the lowest issuance year in a decade. However, there is potential for modest upside if the recent trend of spread tightening - and public issuance to take advantage of it - continues.
Geographically the dynamics in Europe are changing. Historically buoyant issuance from the Netherlands, Spain and the UK has been declining over the past three years. A reduction of more than half from these countries is hard to offset despite a substantial increase in issuance from France and Italy, with the latter up to EUR42bn from EUR14bn. We expect the regional shift to continue for at least 2013.
Fitch considers the early January public placement of an Italian RMBS transaction, Berica 10, which was first issued in December 2011 for ECB repo purposes, as one of the more encouraging signs of market re-emergence. "Although we are under no illusion that this constitutes 'real' new issuance, the mere fact that Italian deals can be placed in the current market is a positive sign for the year ahead," says Philip Walsh, head of EMEA Structured Finance Business & Relationship Management.
Regulatory uncertainty continues to keep the brakes on the European Structured Finance market despite recent positive proposals under Basel III to allow banks to include certain types of RMBS in their Liquidity Coverage Ratio.
Fitch Voice: Structured Finance provides a quarterly series of topical articles on developments in the global structured finance sector. It has replaced the previous quarterly US and EMEA Snapshot reports. Most of the reference material previously provided in Snapshot is available separately at www.fitchratings.com.
Link to Fitch Ratings' Report: Fitch Voice: Structured Finance