ASF Picks S&P's FIRMS to Create Loan Tracker
The American Securitization Forum (ASF), a trade body representing issuers, investors and servicers in the securitization industry, is tasking Standard & Poor’s to create a method that identifies the origination timeline of a securitized asset. With this new number, the ASF hopes to give investors more information on the nature of the underlying collateral. S&P’s Fixed Income Risk Management Services (FIRMS), an analytics unit separate from the company’s ratings business, will implement the numbering system as well as create a central loan information database on behalf of ASF’s Project RESTART, the forum’s initiative to promote transparency in the asset-backed securities market. S&P will assign the unique ID to the loan at no cost to issuers, and it will be linked to the Committee on Uniform Security Identification Procedures (CUSIP) and International Securities Identification Number (ISIN) numbers of the security where the mortgage is packaged. The numbering system hasn't been finalized, S&P told HousingWire, but the 11-character alphanumeric code will be a so-called "intelligent number," that investors can use to break down the when and where the loan was originated and who issued it. With this unique loan number, investors can analyze the risk, collateral and credit of the loans that make up a security. “This partnership with FIRMS allows the market to develop better infrastructure necessary to develop commonly accepted and widely used standards for transparency, due diligence and risk retention,” says Tom Deutsch, deputy executive director of the American Securitization Forum. “The creation of unique loan-level identifiers is an enormous step forward in the process of creating a more transparent information on underlying collateral in securitizations.” Write to Austin Kilgore.