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SF Credit Brief: U.S. Structured Finance Issuance Of $97 Billion In November Marks Second Consecutive Monthly Record

U.S. structured finance new issuance totaled $97 billion in November 2021 across the industry's four major sectors: asset-backed securities (ABS), commercial mortgage-backed securities (CMBS), collateralized loan obligation (CLO), and residential mortgage-backed securities (RMBS). November's issuance brought these four sectors' 2021 total to $743 billion--a 75% increase from $426 billion a year earlier. Structured finance issuance through November 2021 has exceeded all annual volumes since the Great Recession, and November's issuance marks the highest monthly volume since that time. Further, all four major sectors have now eclipsed our full-year forecasts and continue to build on their pace above last year's issuance. CLOs continue to lead the way, with a 116% year-over-year increase, and CMBS is not far behind.

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CLO refinancings (refis) and resets, which we do not count in the new-issue total, reached approximately $235 billion in November. This brings the combined CLO issuance total to $412 billion--$127 billion more than the $285 billion full-year record set in 2017. Meanwhile, after trailing last year's tally through the first quarter, CMBS issuance is now up 111% year over year, while RMBS and ABS issuances increased 62% and 53%, respectively.

Sector Breakdown

ABS

ABS issuance totaled $34 billion in November, marking the highest month of the year. Of this amount, auto loan and lease ABS was more than $13 billion combined, esoteric/nontraditional totaled $12 billion, credit card ABS recorded $5 billion, student loan was over $2 billion, and personal loan ABS was approximately $2 billion (slight differences in totals may exist due to rounding).

CLO

CLO new issuance also reached a new monthly record, with $26 billion in November, while refis and resets totaled $17 billion. The year-to-date (YTD) refi and reset issuance volume of $235 billion through November continued to build over the annual record of $167 billion set in 2017, while the new-issuance volume of $177 billon exceeded the previous $129 billion high set in 2018.

CMBS

Private-label CMBS issuance, excluding commercial real estate (CRE) CLOs, totaled roughly $15 billion in November, bringing the YTD total to $102 billion. These issuances included four conduit transactions totaling $4 billion and 11 single-borrower transactions totaling $11 billion. The single-borrower sector has been extremely active this year, accounting for 73% ($75 billion) of all private-label CMBS (excluding CRE CLOs) issued. Conduits' YTD issuance totaled more than $27 billion, including the approximately $4 billion issued in November. CRE CLOs' YTD issuance totaled $44 billion, including seven transactions totaling $7 billion priced in November.

RMBS

RMBS issuance totaled $22 billion in November. This included more than $4 billion in prime (including prime jumbo) offerings, approximately $4 billion in nonqualified mortgage, about $3 billion in single-family rental, over $2 billion in credit risk transfer, $2 billion in agency-eligible loans, $2 billion in reperforming/nonperforming loans, and another $2 billion in investor loans. The remainder comprised modest offerings from other types of collateral, including reverse mortgage, seasoned performing loans, and mortgage servicing rights, among others.

Annual Breakdown

This will be our final monthly publication on U.S. structured finance issuance this year. Our full-year 2021 totals will be available in our global structured finance 2022 outlook article, which we aim to publish in the second week of January 2022. The table below shows a breakdown of U.S. structured finance issuance through Nov. 30, 2021.

U.S. Structured Finance Issuance YTD
(Bil. $)
2015 2016 2017 2018 2019 2020 2020 YTD 2021 YTD 2021F
ABS 183 191 229 239 244 193 190 289 260
CMBS 95 69 88 77 96 53 48 102 80
CLO 98 72 118 129 118 93 81 177 140
RMBS 54 34 70 95 124 114 108 175(ii) 150
Total U.S. new issue 430 366 505 540 582 453 426 743 630
CLO reset/refi(i) 10 39 167 156 43 33 28 235 NA
CRE CLOs(i) 5 3 8 14 18 8 8 44 NA
Note: Figures were rounded after calculations, and may be revised from time to time based on new information. (i)Not included in new issue total. (ii)We have revised our YTD RMBS issuance estimate based on new information. ABS--Asset-backed securities. CMBS--Commercial mortgage-backed securities. CRE--Commercial real estate. CLO--Collateralized loan obligation. RMBS--Residential mortgage-backed securities. YTD--Year to date. F--Forcecast. NA--Not available. Source: S&P Global Ratings, LCD/S&P Global Market Intelligence, Bloomberg, Intex, Asset-Backed Alert, and Commercial Mortgage Alert.

This report does not constitute a rating action.

Primary Contact:Brenden J Kugle, Centennial + 1 (303) 721 4619;
brenden.kugle@spglobal.com
Secondary Contact:James M Manzi, CFA, Washington D.C. + 1 (202) 383 2028;
james.manzi@spglobal.com

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