Source: www.wsj.com
By Anusha Shrivastava
Of DOW JONES NEWSWIRES
NEW YORK (Dow Jones)--Bank of America Merrill Lynch is tapping the consumer loan-backed market with a $750 million bond that is expected to price this week, according to a person familiar with the matter.
The credit card loan-backed deal, dubbed BACCT 2010 A1, is the first the bank has offered this year.
The self-led deal has a single 2.92 year triple-A rated tranche that will be priced over one month London interbank offered rate, or Libor.
Last week, American Express Co. (AXP) sold a $911.8 million credit card loan-backed bond. Demand for that bond, which was increased in size, was driven by several factors, including lack of supply in the credit card loan-backed market and investors' improved comfort with the stabilization of consumer credit trends, market participants said.
Auto sector issuance has comprised the bulk of asset-backed securities issued so far this year.
"At approximately 65% of ABS issuance, auto and equipment has dominated volumes year-to-date," said Daniel McGarvey, head of non-mortgage ABS at RBS Securities in Stamford, Conn., noting he expects that while issuance will continue in these sectors, there will be "an increase in credit card issuance, as well as increased volumes in more esoteric asset classes."
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