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Home Articles European New European Securitisation Issuance Down 33.4% in Q3-2019

New European Securitisation Issuance Down 33.4% in Q3-2019

The total amount of new European securitisation issuance reached €40.4billion in Q3-2019, according to new data from the Association of Financial Markets in Europe (AFME).

This new issuance mostly consisted of ABS (34.7%), RMBS (31.8%) and CDO/CLO (29.3%) securities.

European securitisation issuance during Q3-2019, by collateral type
Data: European securitisation issuance during Q3-2019, by collateral type; Source: Association for Financial Markets in Europe (AFME)

The level of new issuance is down 33.4% from €60.7bn in Q2-2019, and €54.5bn in Q3-2018.

A relatively lower volume of RMBS appears to be behind the decrease. In Q2-2019 there was €34.2bn of European RMBS issued, whereas in Q3-2019 that figure dropped to €12.9bn.

Other collateral types showed relative strength during the quarter with new European CLO/CDO issuance expanding by €11.9bn. This is €2.2bn higher than in Q2-2019, but down on the €14.2bn seen in Q3-2018.

€9.4bn (23.1%) of issuance was retained during the quarter, which is down from €33.0bn (54.4%) in Q2-2019.

New issuance during the first three quarters of 2019 is running at €133.5bn, which is significantly behind the €181.1bn issued during the first three quarters of 2018.

This decline appears to be quite broad-based across collateral types but is heavily impacted by lower RMBS issuance, dropping from €87bn in the first three quarters of 2018 to €67.1bn in the same period of 2019.

Q4-2018 was a particularly active quarter with €88.6bn of issuance, significantly more than seen during the rest of 2018. Taking the lead from the latest ECB data on FVCs, Q4-2019 is likely to reflect a similar pattern.

Visit AFME’s website here: https://www.afme.eu/

NB: These statistics refer to issuance involving European collateral, not jurisdiction of issuer which is the basis for Central Bank/ECB FVC statistics.

Dominick Barrett
Dominick Barrett
Dominick is Managing Director of Atlantic Star Consulting.

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