DBRS Morningstar Releases European Structured Finance 2020 Year in Review Commentary

DBRS Ratings Limited (DBRS Morningstar) released a commentary summarising key trends in Europe’s structured finance market in 2020. The year started off well, but then took a major step back following restrictions put in place to curb the spread of the Coronavirus Disease (COVID-19), which the World Health Organization declared as a pandemic on 11 March 2020.

Increased efforts around the globe to contain the coronavirus continue to significantly affect the global economy. Almost a year later, the magnitude of its economic impact still remains unclear. In the securitisation markets, in the early days of the pandemic, issuance started off higher in Q1 2020 than in Q1 2019, but then dropped dramatically. Further, issuers switched their focus from investor-placed transactions to transactions retained for liquidity.

Moreover, relief measures such as payment holidays and furlough schemes have created challenges from servicing and liquidity perspectives and have led to questions surrounding what will happen to delinquency levels when these support measures are phased out.

This commentary provides an overview of the deals we rated in the ABS, RMBS, structured credit, CMBS, and NPL sectors; notes interesting market trends in those asset classes; and highlights some of the most popular research we published last year.

Some highlights from the commentary include:
-- European structured finance issuance in 2020, a year dominated by the coronavirus pandemic.
-- Discussion surrounding the impact of the coronavirus pandemic and how measures such as payment holidays and furlough schemes have affected transactions across asset classes and what to expect as these measures taper off in 2021.
-- Overview of rating actions by European Structured Finance sector amid the coronavirus pandemic.

The commentary is available at www.dbrsmorningstar.com. For more information, visit www.dbrsmorningstar.com or contact us at info@dbrsmorningstar.com.

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