The structured finance market in Europe, Middle East and Africa (EMEA) exhibited a four percent year-on-year increase in issuance volumes to €268.2 billion in 2003, whilst the rise in actual numbers of rated deals was a more impressive 58 percent to 577, says Moody's Investors Service in its 2003 Review & 2004 Outlook for this market.
According to the review, moderate growth is expected for 2004, with a continued rise in synthetic issuance volumes and the appearance of new jurisdictions being two key features.
"Most EMEA jurisdictions enjoyed an increase in issuance volumes in 2003, with the exception of Italy and Germany, whilst Residential Mortgage-Backed Securities (RMBS) took over from Collateralised Debt Obligations (CDOs) as the largest asset class in the region," says Moody's Vice President-Senior Analyst and author of the report, Judit Seymour.
The most notable characteristic of the EMEA market in 2003 was the dominance of RMBS, which accounted for 50 percent of issuance volume and experienced a 52 percent growth compared to 2002. Although the share of CDOs fell to 26 percent from 36 percent, as volume dropped by double digits, the steady increase in the number of deals continued to reflect an active market. Asset-Backed Securities (ABS) was the only asset class other than RMBS to grow in volume, increasing one percent on the year, whilst neither Commercial Mortgage-Backed Securities (CMBS) nor Whole Business Securitisation (WBS) lived up to forecasts.
For 2004, Moody's is anticipating a moderate rise of around eight percent in issuance volume, as well as continued growth in the number of rated transactions. Specifically, RMBS is likely to enjoy a lower level of growth after its dramatic surge over the past year and to witness a strong contribution from repeat issuers, whilst the trend for single-tranche transactions could prompt a continued dampening in CDO volumes despite a rise in deal numbers. ABS should see some diversification away from consumer assets and display moderate growth. — (menareport.com)
© 2004 Mena Report (www.menareport.com)
