Is US securitisation going back to 2005?

Author: Danielle Myles, Zoe Thomas | Published: 24 Feb 2014

The ABS market’s return in the US features a healthy dose of caution. But growing confidence and the appearance of new structures begs the question: have we been here before?

The financial crisis have dried up the US asset-backed securities (ABS) market, but deals are returning. The backlog of new regulation is now beginning to clear, injecting needed clarity and building market confidence.

The blame for the financial crisis mostly fell on mortgage-backed securities (MBS), particularly residential MBS (RMBS), which has led to increased regulation – some of which has not yet been finalised. But while RMBS is yet to make a strong recovery, other forms of ABS have come back to market and are being joined by new asset classes.

"Right now feels like the end of 2005," says Stuart Litwin, a Mayer Brown partner based in Chicago. "There's a general level of optimism, and people feel they can...