Securitization market evolves to adapt to crisis

10/13/2009 | Financial Times (tiered subscription model)

The securitization market has started to thaw, but many industry participants agreed that some of the more complex instruments, such as collateralized debt obligation squareds, might never return. Asset-backed securities from Lloyds Banking Group and Volkswagen were heralded as helping to reopen the market, but they were also considered to be "plain vanilla" deals. "We've gone from a time where everyone bought ABS and fought for every extra basis point through a knee-jerk period where you couldn't sell these deals at all. Now the debate about the future is becoming more reasoned and forward-looking," said Gareth Davies, JPMorgan Chase's head of European ABS research.

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