CREDIT CRUNCH FELT IN DROP IN ASSET-BACKED NEW OTC ISSUES, SHOWS XTRAKTER DATA

Posted April 4, 2008

LONDON -- Asset-backed new issuance dropped by 44.6 percent (a drop of $68.3 billion) in the first quarter of 2008 compared to the first quarter of 2007, according to data collected by Xtrakter, a fixed-income market utility. Asset-backed new issuance totaled $84.9 billion, or 12.6 percent of total new issuance, which was $672.9 billion. Asset-backed new issuance in the first quarter of 2007 totaled $153.3 billion.

Overall new issuance in the first quarter of 2008 declined by 28.2 percent, or by $264.2 billion, resulting in a total of $672.9 billion. “This clearly outlines a trend in moving away from asset-backed new issuance and is in line with our expectations of the impact of the credit crunch,” says Kevin Milne, Chief Executive of Xtrakter. “If the markets’ appetite for such offerings does not improve, we expect to see this figure decline further in the second quarter.”

The Euro was again the dominant currency of issue in the first quarter of 2008, capturing 44.7 percent or $300.6 billion against the US dollar which was chosen for 38.5 percent or $259.2 billion, and Pounds Sterling was selected for 5.8 percent or $38.9 billion during the quarter.

The following currency changes were also observed when comparing figures for the first quarters of 2007 and 2008:

• Arab Emirate Dirham rose by 596 percent or $1.7 billion to a total of $1.9 billion

• Swedish Krona rose by 95 percent or $2.3 billion to a total of $4.7 billion.

• Romanian Leu declined by 100 percent or $431 million to no value.

• Hong Kong Dollar declined by 66 percent or $3.9 billion to a total of $441 million.

During the first quarter of 2008, the international capital markets increased in total value to $11.6 trillion, in terms of outstanding debt (excluding private issuance). This resulted in a 5.8 percent or $639 billion increase over the same period in 2007, resulting in overall 0.8 percent or $94 billion increase on total 2007 figures, according to Xtrakter, which conducted its market analysis using TRAX, its trade-matching and regulatory reporting system for the over-the-counter market.

According to TRAX, the Euro represented 48 percent or $5.58 trillion), the US dollar 33.7 percent or $3.9 trillion and Pounds Sterling 10.7 percent or $1.2 trillion of the total outstanding value for the period.