Bond Level Reporting Becoming Reality for RMBS
One month after the American Securitization Forum (ASF), a trade group representing the interests of the securitization industry, called for more transparency on status changes in underlying residential mortgage-backed securities (RMBS) collateral, industry players are responding. Clayton Holdings already updated its systems to incorporate the ASF's Loan Identification Number Code (LINC) system next year, which allows collateral to be tracked, but bond-level reporting represents another aspect of much needed transparency for the securitization market, especially in RMBS. However, one insider tells HousingWire, that the need for bond level reporting has never been greater: "The percentage of fixed rates changes over time in any given portfolio, and we need to know not just how collateral performs but how it changes." Indeed, Principia Partners, a provider of software to manage and administrate structured finance portfolios, announced today that it successfully enhanced its structured finance platform (SFP) to analyze and report on bond-level information for RMBS and other structured credit asset classes. This move is largely in support of the market standards being proposed by the ASF and the European Securitization Forum (ESF). According to Principia, the new interface includes a standard set of bond issuance data descriptors that enables investors to map trustee data directly into their systems. Within SFP, tranches can be evaluated in the context of the original securitization or across all the deals being managed in a portfolio. The platform also allows this data to be analyzed alongside collateral pool performance data from any given source. Organizations can set limits, flag deals and monitor triggers that have been established within the indenture of a securitization, to track and maintain compliance over time. Write to Jacob Gaffney. The author holds no relevant investments.