EUROPESERVICING 2008

EUROPESERVICING 2006: PROGRAMME

DAY 1 (MAY 31): 'THE WORLD IS NOT ENOUGH'
Servicing for commercial real estate, CMBS, and covered bonds

[CLICK HERE FOR DAY 2 PROGRAMME]

Updated: Click on movie titles for Director's Notes!

08:00	REGISTRATION, COFFEE AND REFRESHMENTS

08:30	INTRODUCTION AND OPENING COMMENTS

08:45	FROM 'MODERN TIMES' TO 'THE MATRIX'
SESSION 1	Changing perspectives on servicing from the "originator's back office" to the "investor's front office" and the currency of information
GUEST HOST	HELENA DAY, Vice President, Morgan Stanley Mortgage Servicing
PANEL	ALEXANDER BATCHVAROV, Head of International Structured Finance Research, Merrill Lynch International CLIVE BULL, Director, European Commercial Real Estate Group, Deutsche Bank AG HOWARD ESAKI, Executive Director, Morgan Stanley HOLLY HAMMARSTROM, Head of ABS Research, European Credit Management Limited
	The European servicing sector has been undervalued and slow to develop due to the dominance of on-balance sheet funding and bundled national markets with an inherently negative perception of servicing operations as a labour-intensive and industrialized factory for portfolio administration. The drive toward integration and internationalization of European markets and the increased optimization of funding efficiencies, risk transfer and economic capital management have resulted in a gradual "unbundling" of national European markets in order to leverage the entire mortgage value chain more efficiently. This session explains why common perceptions of servicing are outdated by shifting the perspective of servicing from yesterday’s "originator back office" to today’s "investor front office". This perspective more accurately reflects the proactive role that servicers play in managing the informational currency that drives capital market funding. We’ll start by discussing the evolution and growth of CMBS in the U.S. in contrast to the growth of European covered bonds and CMBS; explain the different functions and types of servicers that have evolved; explore how information acts as currency in secondary market transactions and how servicers acquire, process, distribute and protect that information in fulfilling their responsibilities among the various parties in capital market transactions. We will end with some challenging thoughts about why information serves as the industry’s most valuable long-term asset and how much further that information can be leveraged as a strategic asset beyond traditional investor reporting and market transparency. Is it possible to create a repository of aggregated data for European MBS markets to use as a Basel II reference point?

10:00	REFRESHMENT BREAK

10:15	'BAMBI MEETS GODZILLA'
SESSION 2	When European privacy, flexibility and innovation meet American transparency, standardization and commoditization . . . can we engineer a positive outcome?
GUEST HOST	CHARLES ROBERTS, Partner, Cadwalader, Wickersham & Taft LLP
PANEL	BILL COHANE, Managing Director, Wachovia Securities SCOTT GOEDKEN, Investment Director - Acquisitions, LNR Partners Europe MICHAEL GUTIERREZ, Director, Servicer Evaluations, Structured Finance, Standard & Poor’s RODNEY PELLETIER, Senior Director, FitchRatings HANS VRENSEN, Director, Securitisation Research, Barclays Capital
	Transparency is the key to expand our discussion last year on the contrasting evolution and pace of the American CMBS vs. European CMBS and commercial real estate finance markets. The commoditization of the US market has achieved the transparency that investors expect; its standardization has enabled servicers to streamline and centralize operations to cut costs and outsource or offshore non-core functions, and the creditor-friendly American regulatory environment allows for an overt, hard-line approach toward borrowers. The complex jurisdictional nature of European markets demands innovation, flexibility and patience across multiple jurisdictions in which standardized regulations, practices and technology are only recently beginning to take shape. Furthermore, the relationship-banking and borrower-friendly regulatory environment throughout Europe requires a customized, relationship-oriented servicing approach toward borrowers that prevents scale or volume-driven approaches. The increasing numbers of American players entering European markets from the outside through Greenfield operations and joint ventures or from within as key personnel in distinctly European initiatives have raised concerns over the "Americanisation" of European real estate markets. While the context for any national market today is a global one that requires all market practices to be differentiated by those that are "local" vs. those that are "world-class", it is impossible to benchmark direct parallels between US and European markets. However, as European markets take shape, we now see how some servicers are finding the right balance between adapting best U.S. practices and applying them - where possible - to optimise European operations and the overall development of European markets. Lest Americans feel too over-confident, we’ll take a deeper look into covered bonds and other areas in which Europeans have a distinct advantage. Should the same impulse strike Europeans, we’ll point out areas in which they are not yet fully exploiting those natural advantages and some fresh ideas that have not yet been considered as the development of loan tranching in Europe takes flight.

11:30	'CATCH 22'
SESSION 3	Power, presumptions and pricing – recognizing the servicer's dilemma
GUEST HOST	JOHN DEACON, Executive Director, Head of Debt Principal Finance, UBS
PANEL	ANNE BRIDGES, Head of Securitisation, Hatfield Philips International ROBBIE HUGHES, Director, Business Development, Capmark Europe EDDIE REGISTER, Director of European Servicer Ratings, FitchRatings ROB WOJCIECHOWICZ, Executive Director, Morgan Stanley Mortgage Servicing
	Whether captive or third-party, no one has ever said servicing was easy. In the U.S. market virtually every industry conference features a session dedicated to beating up the servicers. In Europe, servicers can’t even get enough attention to be arrested. "Catch-22" refers to the frustration of double-binds and circular logic. In simple terms, no matter what the rule is, there is always an exception to it. This session explores the servicers’ predicament which impacts profitability and performance across their many roles and responsibilities. In particular we will discuss what activities are considered "standard" vs. their pricing in order to separate the exceptions in which who should pay and who should perform remain unclear; current price wars among third-party providers and how any price war impacts quality; highlight new research on weighted average European servicer pricing; discuss the correlation between deal structure set up and exit strategies; show where disintermediation is occurring among key parties in new transactions and offer recommendations for creating workable service level agreements to establish clear "finish lines" in a race that never ends.

12:30	LUNCH

13:15	'BEING THERE' VS. 'THE STUNT MAN'
SESSION 4	Differing challenges between captive and third-party servicers and their impact on pan-European market developments
GUEST HOST	EDDIE REGISTER, Director of European Servicer Ratings, FitchRatings
PANEL	JAMES BANNISTER, Senior Manager, Morgan Stanley Mortgage Servicing ANNE BRIDGES, Director, European Securitisation Group, Hatfield Philips International JAYNE BLACK, Partner, Real Estate Finance Practice, Katten Muchin Rosenman Cornish LLP MONICA FILKOVA, Portfolio Administrator, EUROHYPO AG ROBBIE HUGHES, Director, Business Development, Capmark Europe
	The race that never ends is the pursuit of quality and performance. European CMBS and covered bond administration is traditionally performed by in-house or "captive" servicers with only five third-party servicers - so far - actively providing alternative solutions. While we expect the number of third-party providers to increase substantially in the next year (indeed, most likely by the time EuropeServicing 2006 is actually held), already the presence of such limited numbers of third-party providers has dramatically impacted European CMBS market developments on crucial issues including servicer quality, communication, Chinese walls and conflicts of interest. This session focuses on how servicer quality is impacted by ownership and responsibility across different scenarios; how market and deal structure challenges differ between third-party and captive servicers; how those differences are currently managed and how those differences will widen further with more entrants to the sector. The session will raise questions about which entities or market players will mediate, reinforce and regulate the conflicts and considerations that will arise as a result, with a response at the end of the day’s programme from rating agencies and issuers.

14:30	REFRESHMENT BREAK

14:45	'HEAVEN CAN WAIT'
SESSION 5	Special servicing from loss mitigation on sub-performing loans to the afterlife of non-performing loans (NPLs)
GUEST HOST	GLENN AARONSON, Co-head European Asset Management, Morgan Stanley Real Estate Fund, and Head of Acquisitions, Germany and Holland
PANEL	MAURIZIO COGGIOLA, Deputy Chairman, Capitalia Service JV MATT GREFSHEIM, Vice President, Morgan Stanley Mortgage Servicing TOM HAVERKAMP, Member of the Management Board, GFKL Financial Services AG JÖRG WULFKEN, Partner, Mayer, Brown, Rowe & Maw LLP EDWARD ZUGHAIB, Partner, Real Estate Finance Practice, Katten Muchin Rosenman Cornish LLP
	Sometimes quality is considered after the fact. Exceptional circumstances throughout the lifecycle of many loans drive the need for "critical care" units to diagnose and repair, remediate or dispose of loans that cannot be "nursed" back to profitability. Relaxed underwriting at origination, a downturn in the economic environment, over-optimism or a dramatic change in socio-political demographics, fraud, bankruptcy, and many other circumstances impact a borrower’s inability to pay, yet the inherent value of the underlying real estate remains. This is when the value of servicing is at its highest as special servicers step in to execute strategies and systematic actions to mitigate recurring losses, workout alternative loan solutions or liquidate loans for which there are no further possibilities. In fact, the majority of loans that go into special servicing eventually result in a net loss. Working against those odds requires a well-coordinated and multi-disciplinary team approach of servicing specialists who fundamentally understand the nature of real estate, particularly in markets with volumes of NPLs that exceed the internal capabilities of most banks’ internal work-out facilities. We’ve themed this session "Heaven Can Wait" to reflect the goal of every special servicer and highlight the "afterlife" of NPLs as issuers gear up to securitise acquired NPL portfolios. During the RTC sales in the ‘80s that established the foundation of the U.S. CMBS industry, tough lessons were learned about the correlation between the price paid for distressed assets and special servicing required to optimize exit strategies. Today almost all buyers of European NPLs anticipate exit strategies before making bids on any portfolio and regard special servicing as their most strategic asset. As the most hotly contested NPL acquisition markets, Italy and Germany feature the most active special servicers in Europe. This session takes a look at the abundance of new players in those markets with a focus on lessons learned in the strategies and timing of loss mitigation efforts in distressed markets and how those lessons can be applied throughout other European markets.

16:00	'SENSE AND SENSIBILITY'
SESSION 6	Rating agency, issuer and investor perspectives on servicer capabilities, surveillance and operational risk
GUEST HOST	HELENA DAY, Vice President, Morgan Stanley Mortgage Servicing
PANEL	FATEN BIZZARI, Senior Credit Manager, HBOS Treasury Services MARIE-NOELLE BRISSON, Director, Standard & Poor's ANOOP GHAI, Director, Head of Conduit Finance, Citigroup (TBC) GIOVANNI PINI, Credit Analyst, European Credit Management EDWARD REGISTER, Director of European Servicer Ratings, FitchRatings
	This session gives "the last word" on servicing to a panel of leading issuers, rating agencies and investors. In building confidence among all parties that appropriate risk measures are in place, we’ll get an outside perspective on the progress of the servicing sector in addressing current market needs and complexities. The session also provides a response and further commentary on issues raised earlier in our session on differing challenges between captive and third-party servicers, and asks provocative questions which have no answers but clearly define the need for enhanced collaboration among all parties involved in advancing the development of European CMBS, covered bonds and commercial real estate. Specific discussion topics include: Are servicers fairly balancing the interests of all parties in transactions, and what can they do to further improve that balance? How will the combination of Basel II compliance and the massive consolidation of the European banking sector impact originators, issuers and servicers over the near term? Is there sufficient servicing capacity in Europe to manage the increasing numbers of conduits launching? Regarding the value of servicer ratings, as the complexity of European CMBS transactions increase and covered bonds now include MBS in their cover pools when can we expect ratings to become mandatory for all servicers involved in any public issuance - and who should enforce that requirement? What should be the minimum tenure for servicers to be operating successfully in a market before receiving a rating? Are current servicer ratings too broad to be effective in differentiating servicer quality? How will rating agencies or issuers look upon secondary outsourcing by servicers themselves? Under what circumstances would issuers be comfortable utilizing, and rating agencies accepting servicer advances in place of liquidity facilities? Considering the absence of back-up servicing in European CMBS and a move toward advancing, what should the minimum capital requirement be for all third-party servicers?

17.15	NETWORKING AND COCKTAIL RECEPTION (to 20:00)

DAY 2 (JUNE 1):‘TOMORROW NEVER DIES’
Mortgage processing, administration, and servicing for residential mortgage loans and RMBS