Canada Housing Rules Revive Paper Market Quiet Since Crisis
- Uninsured mortgages could go to asset-backed commercial paper
- Market has slowed since 2007 liquidity crisis in asset class
Housing Rules Revive Paper Market Quiet Since Crisis
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New rules aimed at cooling Canada’s housing market are poised to revive a corner of the debt market that’s remained sluggish since part of it blew up during the global financial crisis almost a decade ago.
The measures, designed to reduce Canadian government exposure to housing by tightening access to mortgage insurance, may lead to increased sales in the C$15 billion ($11 billion) market for commercial paper backed by residential mortgages, analysts said. ABCP is classified as debt with a maturity of no more than 270 days, with a typical duration of 45 to 60 days.