Challenges and Solutions for Securitization Professionals
Users in multiple deals can see all the transactions that they have access to on one “hub” screen. Bankers can set up specific files for non-engaged rating agencies to have on-demand access to relevant deal information in order to satisfy the 17g-5 regulations.
19 February 2011
It is always interesting to attend a conference in a totally different role from the one you had when you were last there. It is even more interesting when the conference itself undergoes a dramatic change as a result of an industry crisis or major event. Such was the case when I recently attended the American Securitization Forum’s (ASF) annual 2011 conference in Orlando, FL. At its peak, the ASF conference was held in Las Vegas and was a raucous event attended by thousands of bankers, investors, lawyers and vendors. At that time, I was working at Standard & Poor’s and responsible for commercializing S&P’s structured finance analytical models and data. Now, the tenor at the conference is much more subdued as most panel sessions focus on how to revive many of the asset backed securities markets that essentially imploded in 2008 and have yet to show any significant recovery more than two years later. And my new role is heading up the Debt Capital Market (DCM) efforts for Intralinks.
The most prevalent themes at the event included:
- “Transparency” and “insight” were perhaps the most prevalent buzzwords, particularly as a majority of vendors were pushing the message that their data and/or tools would help people better understand their risk and better value their existing or potential structured investments
- Everyone wanted to talk about how to reduce the residential mortgage market dependency on the GSEs — but specifics were in short supply and expectations were that any changes would take a very, very long time
- General consensus that the CMBS market was showing signs of life and would probably more than triple last year’s approximate $10 billion of issuance; ABS (autos, cards) issuance would likely be flat in 2011 versus 2010; RMBS non-agency securitization close to zero
- Way too much regulatory uncertainty is holding back market recovery
- Existing new regulations in effect – such as SEC Reg 17g-5 — are not working and are having unintended consequences
So what did I think was missing? Very few panel discussions and vendors focused on the operational aspects of the securitization process and how it could be made more efficient and reduce concerns about regulatory non-compliance. Perhaps this is because many participants were focused on just trying to get the market back up and running – but it is not too early to consider how to get an edge over the competition by running a smoother and more positive overall experience for deal constituents.
One can do that by addressing many of the concerns/issues that I heard repeatedly at the conference. They included:
- The difficulty in navigating and satisfying all the new and potential regulations
- Spending too much time interfacing and communicating with deal participants including issuers, arrangers, managers, rating agencies, investors, trustees and lawyers
- Dealing with e-mail limitations such as “bounce backs” because of large collateral file sizes
- Maintaining secure and well-organized deal information for audits, compliance and reporting
As one of the “non-traditional” vendors at the conference, Intralinks’ focus is to provide solutions to solve the issues listed above. We are a leading provider of critical information exchange solutions and got our start in 1997 transforming the way loan syndication bankers did business. For several years, we have also been used by leading banks to facilitate CMBS and other securitization deals. When briefly describing Intralinks to conference participants who were unfamiliar with us, some commented: “sounds like SharePoint on steroids” or “reminds me of Documentum outside my firewall”. While I understand these comments, Intralinks is actually so much more.
Once you become a customer of Intralinks, you can set up your own secure transaction “workspace” in minutes, upload key deal documentation quickly and easily with no size limitations, invite people both inside and outside your organization to view and collaborate on any/all of the uploaded material, permission users with different levels of access, and run reports that will indicate who accessed what and when. You don’t need anything except an internet connection to access your Intralinks exchange, — so you can work anytime and anywhere.
Users in multiple deals can see all the transactions that they have access to on one “hub” screen. Bankers can set up specific files for non-engaged rating agencies to have on-demand access to relevant deal information in order to satisfy the 17g-5 regulations. Once the deal matures and you wish to close your workspace, you can get an archived record of the transaction that preserves all the information and activity related to that transaction. In summary, the reporting functionality coupled with our heavy investment in security and the ease of communication and collaboration capabilities address the four significant client pain-points listed. As 2011 progresses, stay tuned for updates on how we are continuing to add functionality to make our platform even more relevant for securitization professionals.