The End of Libor in the Canadian Securitization Market
DBRS Limited (DBRS Morningstar) published a commentary titled “The End of Libor in the Canadian Securitization Market.” This commentary considers the impact of the discontinuation of the London Interbank Offered Rate (Libor) on the Canadian securitization market, the risks this change poses to investors, and how issuers are mitigating these risks.Key highlights include:
-- The Canadian securitization market’s exposure to Libor is limited.
-- Canadian securitization issuers are expected to have transition plans in place well ahead of applicable discontinuation deadlines.
-- DBRS Morningstar will review the sufficiency of Libor transitions as part of its document review and ratings assessments.
-- Additional Libor transition fees levied by trustees acting in Canadian securitization transactions are not expected to be incurred and should be included in capped fees at the top of the waterfall.
DBRS Morningstar is a global credit ratings business with 700 employees in eight offices globally. DBRS and Morningstar Credit Ratings are committed to empowering investor success, serving the market through leading-edge technology and raising the bar for the industry.
Together, we are the world’s fourth largest credit ratings agency and a market leader in Canada, the U.S. and Europe in multiple asset classes. We rate more than 2,600 issuers and 54,000 securities worldwide and are driven to bring more clarity, diversity and responsiveness to the ratings process. Our approach and size provide the agility to respond to customers’ needs, while being large enough to provide the necessary expertise and resources. For more details visit us at dbrs.com.
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