The U.S. Securitization Market: GLAS Grows Alongside Clients


The U.S. Securitization Market: GLAS Grows Alongside Clients

Mia Drennan, president, founder and co-chair of GLAS, answers Structured Credit Investor’s questions

A growing presence

Q: What is your strategic vision for GLAS and its continued expansion and growth in the US?
A: GLAS was founded in 2011 and we expanded into the US in 2016. Once we secured the necessary regulatory licenses and approvals to operate in the US, we began serving clients on across-border basis across the UK, Europe, Australia and the US markets.

We see a massive market opportunity in the US and our clients have expressed that they value our growing presence there to better serve them on global transactions. Our strategic vision for the coming months is to continue to grow our business in the US and globally, in order to provide the best client service and be influential debt servicing players in growing markets.

Q: What makes GLAS a good fit for the US market?
A: Since entering the US market in 2016, GLAS has played a critical role on a number of high-profile transactions, including the JCPenney and AMC Entertainment Holdings restructurings in 2020. As travel restrictions lift and our global team has the ability to collaborate in-person once again, we really want to seize the opportunity to accelerate growth.

Our clients in the US are keen to tap us for our experience on complex transactions because they know we provide bespoke solutions and unmatched service. During the pandemic, many traditional agent players and bank trustees in the US have exited the market, frustrating a lot of clients. The deal parties we work with need to be able to count on somebody, which is where GLAS comes in.

What is most important to our clients today is that we have shown that we are not in the business of shutting our shop – especially when they need us most. Instead, we have grown our business during the pandemic, developed new technologies and continued to provide the commercial service that we are known for.

Q: What are the primary objectives for the US business?
A: We are aiming to expand our platform, grow our client base and branch out into different services and offerings in line with our clients’ needs. Alongside this development, we’re also planning to bring on the best in the business to build a deeper bench to service clients.

Many in this business are anticipating a wave of bankruptcy at some point this year and that will be a key driver for our business. GLAS’s legacy at its founding was to act as an administration agent on restructuring transactions – so this is really our bread and butter. It is important that we are fully ready to take on all the new restructuring activity in the US that we are already used to doing as a company on a global scale.

Q: Are there different drivers for the business in the US compared to the European market?
A: We’re continuing to observe consolidation in the marketplace for debt service providers, especially as some of the traditional providers are taking a step back from offering some types of services. GLAS is poised to step in on these situations and take over for incumbent agents, getting up to speed quickly and providing value immediately.

The latest additions to our US team further strengthen our offering (SCI 4 February). These and our other recent hires exemplify GLAS’s commitment to delivering seamless support to US clients now and for years to come.

Q: How does GLAS differentiate itself from other trustees?
A: First, we are a commercially-focused entity – we always put our clients first, no matter the situation. We are making deal execution easy for our clients, and we have a deep understanding of risk in transactions and how our clients can avoid pitfalls.

For us, debt servicing is our core business. This is unlike other trustees, for which these services are just a small part of a larger offering or a bigger banking service. We work really hard to be innovative with how we can help clients achieve their financial aims in transactions, even with the really difficult, complex and often hairy situations.

Lastly, our technology is a huge differentiator that allows our clients to track information on their deals in real time. We are making the process easy for deal parties by providing a portal to house documents, complete steps in the transaction and stay up-to-date with the information they need, no matter the time of day.

Q: How does GLAS hope to meet the challenges that face the securitisation market at the moment?
A: The continual ability to execute well and continue to provide efficient servicing, reporting and transparency on situations is key. Our highly experienced team is prepared to deal with the amount of volume that is passing through the market at the moment.

Q: What are your expectations for the market in 2022?
A: For now, there still continues to be a huge amount of money knocking around. People are still investing heavily into businesses across the globe and providing them with liquidity.

The anticipation of rising inflation is at some point going to cause a bit of a stalling and will impact people’s borrowing. Given these market conditions, we can assume that there will potentially be more bankruptcy and restructuring activity towards the end of next year, but at the moment things are very much 2007 rather than 2008.

Q: Finally, how has the Libor transition affected your business?
A: Internally at GLAS, we set up a Libor transition academy at the start of last year to ensure our team was prepared for the new normal. We have a dedicated team that has been working hard, proactively going out to all the clients, deal parties and law firms to talk about how we are approaching Libor transition. We have been working with people in a collaborative manner and being proactive with the creditors that are involved in our deals on this, so we can actually execute change, and we will be doing the same in the US this year.

This article was originally published in Structured Credit Investor.

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