Securitisation is a rapidly growing global market in which UK companies were again the largest European issuers in 2005 with issuance of $181 billion, 39% up on 2004 and more than double the $86 billion in 2003.
The new edition of Interational Financial Services London’s securitization report notes that despite growth in securitisation in Europe and elsewhere, US issuers still dominate globally making up 83% of worldwide issuance of $3,648 billion, of which UK issuers accounted for 5%.
Within Europe, the UK accounted for 45% of securitisation issuance totalling $398 billion, with Spain, the Netherlands and Italy being the next largest issuers. Most European issuers use a London-based team to lead-manage the structure and distribution of the deal. Demand from investors for European issues remains strong, with spreads on the top-rated European issues broadly stable in 2005 at 12 basis points, nearly half the 23 basis points at end-2002.
Issuance in Japan and Australia reached new highs of $81 billion and $76 billion respectively in 2005. Securitisation is also developing in emerging markets with issues totalling $53 billion during the year, about half from South Korean companies, with other major issuers from Brazil, Mexico and Turkey.