Market hopes appear to be running high for the U.S. government's latest push to restart the securitization markets for consumer lending. If the Term Asset-Backed Securities Loan Facility, or TALF, is successful in attracting new investors, it could allow financial institutions to reduce their debt, freeing up their capital for new loans. Standard & Poor's Ratings Services believes TALF's potential returns will likely turn hedge funds into new buyers of asset-backed securities (ABS), although the facility may fall short of its stated lending potential of $1 trillion due to certain restrictive terms and adverse market conditions. And to the extent TALF helps restore confidence in risk taking and helps establish prices for assets, it would be beneficial to bank ratings....
Companies mentioned in this report are:
- Ford Motor Credit Co. LLC
- Fannie Mae
- Nissan Motor Co. Ltd.
- Federal Home Loan Banks
- Freddie Mac
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research Type: Commentary
Criteria articles describe the thought process and methodology Standard & Poor's analysts use in determining ratings. These commentary pieces discuss both the quantitative (economic and financial) and qualitative (business analysis and caliber of management) aspects of the analysis, as well as legal issues. SHOW LESS READ MORE >