IFLR 1000
The Guide to the World's Leading Financial Law Firms

The reputation of securitisation took a battering in the aftermath of the financial crisis but the market is now adapting to the new regulated climate. "Through the new rules we basically have to find a new standard in the market. We were educating the market. It's simply on the plate so you have to deal with it. There's no single standard but I think the market is coping quite well," says a partner.

Regulatory advice is filling a void left by transactional work for some firms as they try to ensure deals adhere to the new parameters. "We have diversified into the regulatory area. On the Risk Potential Rules, the EU directive legislation for securitisations, at the moment it is very work intensive because we feel more and more transactions being structured again," says one lawyer.

Certain asset classes such as CDOs and CLOs have become rare and this, combined with a general lack of conventional work, has pushed some firms to shift focus: "Because the market last year was quite slow [and] there were few transactions, we have started diversifying, still in structured finance, but with a slightly different angle, like derivatives [and] asset-based lending transactions, where there's a structured element."

The evolution of the market aside, lawyers do note an increase in general activity. "We certainly see a pickup in the securitisation market since about half a year ago [Q4 2010]," says one partner. The most resilient asset class has, unsurprisingly, been auto-loan receivables. "Car loan and car lease sector the transactions have really picked up in that market," says one lawyer. Real-estate securitisations are still, however, non-existent.

Restructuring existing CMBS and RMBS transactions is providing the bulk of work for law firms: "It's an ongoing trend, the restructuring of CMBS and RNBS transactions. Quite dramatic and martial restructurings," explains a securitisation specialist.

The German government's pledge to phase out nuclear energy completely by 2022 means renewable projects will create a great deal of instructions for lawyers in numerous practice areas, and it is hoped, in structured finance. "We see a lot of interest in renewable energy financings and the potential of that being securitised or refinanced by a restructured covered bond," says one partner.

Clifford Chance's first tier ranking is undisputed by peers and the firm continues to be involved in the market's key deals. On the first public securitisation backed by German small-to-medium enterprise (SME or Mittelstand) loans placed with investors since the crisis, Kirti Vasu advised UniCredit Germany and Luxembourg on Geldilux-TS-2010, a €612 million cash CLO, which will provide five years funding for the bank.

With refinancing becoming an important part of the securitisation market the firm advised Crédit Agricole Corporate and Investment Bank, Deutsche Bank and Société Générale on a securitisation transaction by means of which Europcar completed the refinancing of its rental car fleet. The structure includes a €250 million senior secured debt security with a maturity of seven years and an €1.3 billion senior asset revolving facility granted by a syndicate of banks The transaction provides financing for Europcar's fleet in Germany, France, Italy and Spain.

Auto-car loans securitisations are resurfacing on the German market and the firm advised Crédit Agricole and Banca IMI, as the arrangers and managers respectively, on the recent refinancing of an auto-loan portfolio for FGA Bank German, Fiat Group's German auto finance arm. The refinancing was achieved by selling the auto-loan portfolio via a special purpose vehicle (SPV), which funded the transaction by issuing €699 million of asset-backed notes and placing €627 million of the notes with investors.

"Hengeler Mueller certainly belongs there, always has done and still does," says a competitor. An undisputed leader in the field, restructuring CMBS and RMBS securities has dominated the team's deal-flow in the last 12 months.

Partner Stefan Krauss has been active for client Deutsche Pfandbriefbank. First on the restructuring of a €596 million UK based CMBS for Hypo Real Estate Bank International and second on the termination a €2.2 billion synthetic CMBS transaction again for Hypo Real Estate Bank.

On the RMBS side, Krauss advised Commerzbank on the restructuring of TS Lago One's €14 billion true sale transaction and Deutsche Postbank, which is now owned by Deutsche Bank, on its €2.5 billion securities.

Partners Daniel Kress and Martin Geiger have also been active advising client GSW Immobilien on restructuring some its securitised real estate loans.

Freshfields is promoted to the second tier on the back of numerous recommendations from the market and for winning complicated mandates. "Freshfields Bruckhaus Deringer is involved in complex structured finance transactions," observes a competitor.

One key deal saw Andreas Bartsch and Bernhard Kaiser advising the German Financial Markets Stabilisation Fund (SoFFin) and the Financial Markets Stabilisation Agency on the transfer of loans and securities of €173 billion from Hypo Real Estate Group (HRE) to FMS Wertmanagement, the Abwicklungsanstalt (bad bank) of HRE. In addition, derivatives were used to hedge the transferred assets against interest rate risks. It was the biggest ever asset transfer in Germany, involving more than 12,500 products across 70 jurisdictions.

On another notable deal the firm advised GMAC Bank on the securitisation of auto loan receivables, valued at approximately €450 million in November 2010. This was the first transaction of its kind since the implementation of the Capital Requirements Directive (CRD II), which stipulates a 5% retention and increased reporting requirements.

The firm is also working on the restructuring and workout for more than 20 transactions, which comprise the whole range of asset backed securities such as CDOs, RMBS, CMBS, CRE, CLOs for a client who must remain confidential.

Head of the securitisation department Kurt Dittrich was active for a well-known bank on a true sale securitisation of an €800 million revolving portfolio of consumer auto loans and lease receivables for a German car manufacturer. The transaction was the first of its kind for the leasing car manufacturer.

Partner Laurenz Uhl has been particularly active for the firm in the last 12 months. He advised on the €1 billion synthetic securitisation of an SME loan portfolio for Commerzbank. It was the bank's first such transaction since the crisis and the implementation of the new securitisation rules set out in the amended Capital Requirements Directive (CRD II).

Uhl has also been engaged in some notable restructuring work. He and Barbara Lauer advised on €875 million true sale securitisation of auto lease and residual value receivables, which was the first residual value receivables transaction to pass the rating agencies under their new criteria. Another deal saw him advise on the restructuring of a €4.5 billion securitisation of small-and-medium enterprise (SME) loans originated by a German Bank.

Uhl again headed the team on the refinancing of Danish SME banks for BNP Paribas and Danske Bank. The transaction involved restructuring several existing true sale securitisations in order to implement new ECB repo criteria and new rating agencies' counterparty criteria.

Partner Dietmar Helms fronted a team for Baker & McKenzie advising Volkswagen Financial Services, HSBC and Wilmington Trust on the securitisation of lease receivables (VCL 12) the first term take out from Volkswagen's VCL Master platform. The deal closed at €519 million in September 2010.

In November 2010 the firm set up the €150 million Luxembourg Securitisation Company as a compartment company and Pan-European finance platform for the Jungheinrich Group. The firm also advised on the addition of two new investors, Mizuho and Commerzbank, and a volume increase of the existing platform structure for MAN. The transaction closed at €400 million in July 2010.

Partner Martin Kaiser acted for WestLB in the context of the first public transaction of Gallinat Bank to securitise €160 million in lease and hire purchase receivables originated by affiliates of Gallinat Bank in January 2011.

The firm has also secured three new bank panel positions for RBS, UniCredit and Crédit Agricole.

In the past 12 month White & Case practice head Ulf Kreppel and partners Dennis Heuer and Michael Rützel have acted on CMBS (commercial mortgage backed security) and RMBS (residential mortgage backed security) restructurings for Hatfield Philips International, Belltrend Menorah Enterprises and Barclays Capital and Residential Capital.

The firm has also been appointed as counsel for UniCredit's ABCP programmes Arabella and Salome. Heuer, Nick Wittek also acts as panel advisers for ABCP work for Helaba Landesbank and LBBW and recently advised Volvo Financial Services Europe on their contemplated ABCP conduit transactions.

On the structured asset-based lending side the firm has been advising clients China Development Bank Jiangsu Branch, North Channel Bank and Bank of America on different asset classes such as trade receivables and life insurance policies.

In other notable work, Heuer was advising the City of Hamburg and the State of Schleswig-Holstein, jointly holding a stake of about 85% in HSH Nordbank, on the structuring of a risk shield with a guarantee of €10 billion provided by the two federal states, a €3 billion capital increase and the establishment of a joint fund by both states.

One client, who was delighted with the work Heuer had done for his company, said: "Dennis is our main point of contact, he's brilliant."

Allen & Overy's capital markets practice is headed by Okko Behrends, who in conjunction with partner Frank Bierwirth has been advising Eurex on the clearing of interest rate derivatives.

An ongoing role saw partner Matthew Howard and Kai Schaffelhuber, who joined the firm as partner from Dewey Le Boeuf in May 2010, advising a US corporation on the structuring of a securitisation of German law lease receivables. A client praises Howard saying: "He is good at finding alternative means to get the job done. I think he is innovative and solution focused."

Behrends has also been leading a team advising the financing arm of a major automobile manufacturer on €525 million of dealer-floorplan securitisation loans granted to car dealerships.

The firm is also advising on the restructuring of several CDO-transactions governed by German law with a value of €1.7 billion.

"Excellent, we had some real professionals on this deal," says a client of Sidley Austin's team. "Jens [Rinze] was very tactful with expressing his solutions for projects. He is very experienced in very difficult situations. There was no recollection of any problems," says another.

The aforementioned Rinze has been active for WestLB in respect of amending a number of existing trade receivables transactions and on a new pan-European trade receivables transaction under the Compass ABSproM Programme, as well as the establishment of a pan-European trade receivables Factoring Programme.

A rare deal, which closed in March 2011, saw him active for DBRS in respect of the rating of a €1.1 billion true sale CLO of a German credit institution.

A major German investment bank also required Rinze's assistance on the implementation of the new capital rules in respect of securitisation transactions under Dodd Frank and the European Capital Requirements Directive. This strategic advice implemented the new securitisation capital regimes of the US, Germany and the European Union into the policy books of a major German investment bank.

An ongoing deal also saw partner Jérôme Friedrich advising a major German bank in connection with the restructuring of various synthetic CMBS structures.

Dewey & LeBoeuf's structured finance team, which is led by Walburga Kullmann, focuses on the aforementioned product rather than asset-backed securities.

The Royal Bank of Scotland recently mandated the firm on several issuance programmes for structured notes, certificates, and warrants and the firm also advised another foreign bank on setting up structured product programmes for the German market in August 2010.

US firm Mayer Brown's German securitisation practice focuses on trade receivables, auto loan, auto lease and consumer loan securitisations. The firm also advices on bank balance sheet funded trade receivables and factoring transactions.

A key deal for the firm, the Smurfit Kappa trade receivables securitisation, was shortlisted for the International Financial Law Review's European Structured Finance deal of the year for 2011. Proceeds of the €250 million five year trade receivables programme, which closed in November 2010, were used to refinance the group's existing €210 million securitisation programme, which matured in September 2011, and will help repay its bank debt.

The largest deal in which the firm was involved in the last 12 months was the securitisation of €430 million in German consumer loans held by its client Santander Consumer Bank, which closed April 2011.