Chrysler, Sallie Latest To Issue Non-TALF Deals
17 Noviembre 2009 - 2:14PM
Noticias Dow Jones
Chrysler Financial Auto and SLM Corp. (SLM), better known as
Sallie Mae, are the latest to join a clutch of issuers who are no
longer offering bonds that can be bought using cheap loans through
a Federal Reserve program.
Instead, these issuers are actively avoiding the Fed's Term
Asset-Backed Securities Loan Facility, or TALF, by coming to market
with their issues well ahead of the monthly loan application
deadline. Earlier in the year, they had leaned on the program to
draw investors to buy their bonds.
"To get away from logjam, auto, credit card and equipment
issuers will look at this strategy of issuing deals away from the
TALF subscription date," said Michael Wade, head of asset
securitization origination, Americas, at Barclays Capital in New
York.
Issuers and investors are once again able to operate without the
Fed's direct help because risk premiums, or spreads, on these deals
have tightened as the market has stabilized.
"If the spread isn't there, then the cash investors will step in
to replace the TALF investors," said Jim Harrington, senior
portfolio manager at Ryan Labs Asset Management.
On Tuesday, Chrysler has an $891 million auto loan-backed deal.
In July, it sold a $1.02 billion deal that was eligible to be
acquired with low-cost loans and guarantees made available under
TALF, which the government introduced in March this year to boost
the securitization market.
Sallie Mae sold its $839 million non-TALF student loan-backed
deal earlier Tuesday. It sold a $2.59 billion deal in May, a $1.1
billion bond in July and a $1.68 billion deal in August; all were
eligible for TALF funding.
One of the inaugural issuers via the TALF program in March, when
it was first launched, Ford Motor Co. (F) is also marketing a
$1.027 billion deal. In June and July, Ford sold three auto
loan-backed deals that were all TALF-eligible. It returned to the
market again in September, selling a $2.074 billion auto
loan-backed deal that was also eligible for TALF. Most recently, in
October, the company sold a $1.5 billion dealer floorplan-backed
deal that could be bought using TALF funds.
World Omni Financial Corp. this month raised $1.04 billion for
an auto loan-backed deal without having to tap the TALF program. In
April, it had been one of the issuers to take advantage of the TALF
program, raising $750 million.
USAA Auto Owner Trust sold a $1 billion non-TALF bond on Nov. 5,
two days after the loan-application deadline for November, and
CarMax and Entergy Texas Restoration Funding LLC have also recently
raised money without the Fed's help.
"It's the continued process," Wade of Barclays said, "of the ABS
market weaning itself from the TALF program."
The next deadline for the consumer-loan-backed portion of TALF
is Dec. 3.
-By Anusha Shrivastava, Dow Jones Newswires; 212-416-2227;
anusha.shrivastava@dowjones.com
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