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S&P: German ABCP Market Set For Expansion in 2001.

Business Editors

LONDON--(BUSINESS WIRE)--(Standard & Poor's)--Feb. 8, 2001

The German ACPB market is set to deepen in the year ahead, following on the success of 2000, said Perry Inglis, a director at Standard & Poor's Rating Group in London, at a conference in Frankfurt today.

"It is expected that the market will enjoy strong growth in 2001, using a similar range of assets as in 2000," he said. "In addition, many issuers are expected to fund smaller trade pools to allow them to access their strong Mittelstand (medium-sized German companies) client base."

German assets accounted for 13% of total volumes in European conduits during the course of 2000, and when rated securities and balance sheet CLOs (collateralized loan obligations) are stripped from the equation it jumps to 27%, he added.

"The number of assets domiciled in Germany grew substantially in 2000, climbing 10% to $11.7 billion in 2000, compared with $10.6 billion in 1999. A total of 17 of the 48 European ABCP conduits now carry German assets," he said. "More than 50% of German-funded assets are trade receivables, and another 35% are promissory note transactions similar to the one being funded in one of Deutsche Bank's conduits. Auto loans were the main German assets funded in 2000.

"Two new German players also entered the European ABCP market in 2000, Commerzbank AG and Siemens Power Ventures Inc., underscoring the market's increasing acceptance of conduit funding as a viable balance sheet management tool," he said further.

Uncertainty over the proposed Bank of International Settlements (BIS) capital adequacy changes could, however, have a limiting effect on ultimate volumes as market players begin to change the economics of such transactions, he concluded.

The Securitization in Germany Conference 2001 is being hosted by Standard & Poor's from Feb. 7-9. -- CreditWire

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Publication:Business Wire
Date:Feb 8, 2001
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