Record volumes continue as market heads for summer breather

Good morning, despite the geopolitical situation worsening once again with the Strait of Hormuz closed and oil prices approaching $80bbl, the European ABS market just keeps on keeping on.

‍

Issuance volume has been simply staggering all year, despite ongoing “macro noise” doing its best to derail the market. It looks highly likely that 2026 will be the third consecutive year of record breaking volume. In euros, the €65bn placed with investors this year is already the fourth best year by volume, beaten only by the FY totals of 2021 (€71bn), 2024 (€93bn) and 2025 (€108bn), according to Concept ABS data.

‍

So, it should be no surprise that despite the school summer holidays starting issuance has continued at its furious pace. Seven deals were priced across sterling and euros this week, and just one of those was not fully offered.

‍

‍

I think many would have earmarked last week as one final hurrah before said holidays and the market slows down. However, this week has a further six trades expected to price, including a solar/heat pump consumer ABS from Enpal and a rare Belgian RMBS. Today will tell us more, but my expectation is that activity will dramatically drop off for five-six weeks starting Monday, 20th of July.

‍

That being said, investor demand is still strong and this is still very clearly a seller’s market. In sterling, Admiral Financial Services priced its £312m Consumer ABS with some of the tightest prints seen in the market across the entire stack, while Lendable’s debut Consumer ABS, with £458.75m marketed, was the largest post-GFC UK placement of consumer assets.

‍

Similarly, Ayvens’ latest Bumper auto ABS, this one from France, priced its triple-A’s 5bps inside the last French Auto from Titrisocram back in March. And Credit Agricole’s Portuguese auto ABS placed €800m with investors, having initially earmarked €200m of its €664m triple-A’s for retention.

‍

‍

It’s likely then that July and August should not be totally silent, but deal flow should be more around 1-2 per week (plus a few CLOs) rather than 5 or more as we’ve seen for a number of weeks. See the above graph for an indication of how much more supply should be expected in July. With approximately, a further €2.7bn in the pipeline for this week alone, July 2026 could be within touching distance of the 2025 record.

‍

Deal of the Week

Concept ABS Overview

Lendable, a UK online/digital consumer lender and servicer, has made its UK consumer ABS debut. Marketing four rated tranches on a provisional static pool size of c.£500m (albeit on an initially targeted deal size of £350m), the newcomer encountered a market that is well on course to set a post-crisis Sterling placement record.

‍

The relatively shallow Sterling account base is in need of a breather. The bid at the top of the capital structure has laboured at times – even if lower rated tranches consistently boast impressive coverage multiples in primary. Generally conservative IPTs ensured solid early participation... click here to read the full overview on Concept ABS.

‍

Concept ABS Market Context

With >£20bn sold in H1, the sterling ABS primary market is already within touching distance of 2025's full year placement of £25bn and well on course to break the post-GFC Sterling placement record of £33.5bn (set in 2024). Until recently, the market has absorbed this paper relatively comfortably. However, the bid is starting to feel fatigued for higher rated paper at times (a recent UK BTL deal struggling up there) – even if the credit curve continues to flatten on the back of consistently impressive multiples for lower rated tranches in primary.

Making its debut in UK securitisation, Lendable would have hoped to stand out from the crowd with the inaugural Hoxton consumer ABS – even if it found itself marketing alongside a comparable Admiral transaction (Morglas). An IPT of low 90s for the top tranche looked confident at first glance vs a comparable deal in March from the Montgomery Square brand (a Fintern UK consumer ABS debut), which sold its equivalent tranche at SONIA + 100bps (although that deal was certainly impacted by the breakout of hostilities in the middle east). The IPTs lower down the stack, on the other hand, looked more aligned with Fintern's transaction.

Initially targeting a £350m total transaction size, a first book update made for reassuring reading, coverage of 1.4x, 2.9x, 3.0x and 2.0x reported reading down the stack... click here to read the full market context on Concept ABS.

‍