Role of the Trustee has become more relevant to over 80% of key players in the Securitization Market

LONDON, June 25, 2009 — The Bank of New York Mellon, a global leader in asset management and securities servicing, surveyed over 200 participants at the Annual Global ABS Conference in London during June 2-3 2009, on the future and out look for the securitization markets, and the factors for future success of the market.

The survey, which encompassed nearly one tenth of the approximately 2,500 delegates at the conference, showed a number of interesting results, including that the role of the trustee has become more relevant to 83% of respondents.

One market participant commented: "The role of the trustee has become far more relevant in terms of the involvement in deal structures."

Another went on to say: "The issue of data integrity and transparency has become much more relevant in this market".

Other key findings of the survey include:

• The CLO market is still alive and set to rebound
• Default rates will peak in the next 6-12 months
• Infrastructure plays the biggest role in successful government stabilisation programmes

Regarding the important issue of investor confidence, when asked, investors voted for independent price verification of assets as being most important. Paradoxically, most structurers and issuers approach this issue from the perspective of either an independent trustee, or the production of independent reports and analysis. These results showed the Investor base continuing to ask for better price discovery from the market.

James Maitland, Head of International Corporate Trust at The Bank of New York Mellon, commented, "Investors do not want to step in while secondary markets are dysfunctional and they cannot accurately assess the value of their portfolios. We know structurers and issuers absolutely understand that the role of the trustee has become ever more important and relevant in today's market, and as a key participant we need to ensure we can provide our input at an early stage of structuring transactions. Our survey confirmed what we have been increasingly hearing from our clients."

The majority — 53% of respondents — also stressed that the provider of outsourcing of operational functions must have proven stability as an organisation. In a related question, participants were asked what factors precipitated the success of government stabilisation programmes. The widely-held view was that a suitable infrastructure was needed to launch and exit these programmes. The Bank of New York Mellon is the administrative agent on the Federal Reserve Bank of New York's TALF Programme.

When asked about the securitization market, over 90% of participants believe that arbitrage cash flow CLOs will return in a meaningful way, albeit not until at least 12 months time. Most delegates agreed that corporate default rates will peak in the next 6-12 months, and see a slow improvement in the market in 2010. For a full analysis of the survey results, please contact Guy Cross at The Bank of New York Mellon guy.cross@bnymellon.com

The Bank of New York Mellon's corporate trust business services more than $12 trillion in outstanding debt from 57 locations around the world. It services all major debt categories, including corporate, municipal and sovereign debt, mortgage-backed and asset-backed securities, derivative securities and international debt offerings. The bank does not compete with investment banks and deal arrangers, which allows it to provide issuers, investors, borrowers and lenders with an independent and objective service for their transactions. Corporate trust providers are appointed by corporations, municipal governments and financial institutions issuing debt to perform a variety of duties, including servicing and maintaining the debt issue, processing principal and interest payments for investors, representing investors in defaults, and providing value-added services for complex debt structures.

The Bank of New York Mellon Corporation is a global financial services company focused on helping clients manage and service their financial assets, operating in 34 countries and serving more than 100 markets. The company is a leading provider of financial services for institutions, corporations and high-net-worth individuals, providing superior asset management and wealth management, asset servicing, issuer services, clearing services and treasury services through a worldwide client-focused team. It has $19.5 trillion in assets under custody and administration, $881 billion in assets under management, and processes global payments averaging $1.8 trillion per day. Additional information is available at www.bnymellon.com.

This press release is issued by The Bank of New York Mellon to members of the financial press and media.
All information and figures source The Bank of New York Mellon unless otherwise stated as at March 31, 2009
The Bank of New York Mellon, London Branch, registered in England and Wales with FC005522 and BR000818
Branch office: One Canada Square, London E14 5AL
Authorised and regulated in the UK by the Financial Services Authority