Our recent conversations with clients and market participants, most notably at the recent SF Vegas 2026 event, have pointed toward significant forward momentum for the U.S. securitization market. The focus was on healthy issuance, the transformative role of private credit in deal structures, and the impact of technology. We are consistently seeing investors moving up in the capital structure in pursuit of higher-quality collateral.
In addition, five common themes came up consistently.
1. Private credit and securitization: A true convergence
Private credit and securitization convergence hasn’t slackened. The question is shifting to how governance, ratings, and servicing will evolve to support the resulting structures at scale. As capital from insurance companies and other specialty lenders seeks yield, securitization can be a powerful and efficient mechanism to access that capital.
Private credit deals frequently involve assets that lack standardized pricing benchmarks or consistent data formats. This makes valuation more challenging, and the complexity is compounded by the need to track and amend covenants. We believe administrative infrastructure must accommodate novel asset types and remain flexible as new industry standards emerge. Trustees and agents navigate this landscape with every new transaction.
What we’re watching
- Will the convergence of private credit and securitization prove structurally resilient, even if macro stress increases?
- How could AI affect the credit stability of complanies including those in software and services sectors?
- How are rating agencies adapting their methodology for evaluating private credit CLO collateral performance?
- What data gaps must be closed to enable the efficient scaling of private asset-backed finance?
2. The CLO toolkit expands far beyond syndicated loans
The CLO format has broadened significantly beyond syndicated loans to include infrastructure deals, fund finance (e.g., CFOs), and middle-market credit. Collateralized Fund Obligations (CFOs), in particular, have matured into a standalone and meaningful fund finance vehicle. Sessions drew essential distinctions between project and corporate infrastructure as CLO assets. With these deals now mainstream, the focus has shifted entirely from novelty to efficient execution.
Given these many variants, a generic CLO playbook no longer meets needs. Resets, refinancings, and liability management continue to increase, while new private credit and infrastructure formats introduce their own operational demands.
What we’re watching
- How are rating agencies standardizing collateral performance across infrastructure CLOs compared to broadly syndicated loan CLOs?
- What new operational requirements are emerging as CFOs continue to grow?
- Where are data and reporting standards lagging behind the structural innovation seen in private credit CLOs?
3. Aircraft ABS: Record expectations and structural innovation
Aircraft ABS is starting 2026 on an optimistic foot. Most people are looking to meet or beat previous issuance records. High lease rates and persistent production delays are sustaining elevated financing pressure, and this is being amplified by demand related to major international travel events. Structurally, change is showing up in master trusts, which offer issuers scale and pre-identified collateral, and aircraft loan ABS, which function more like static-pool CLOs.
Trustee responsibilities vary significantly based on the chosen structure. Since each structure is technically distinct, trustee execution must adapt accordingly.
What we’re watching
- How will the pricing of master trusts versus non-master trusts diverge as issuance volume increases?
- Will E-Notes re-emerge in 2026, and will the underlying economics support broad investor participation or remain a concentrated product?
- How are aircraft loan ABS waterfalls being refined to achieve AAA ratings, and what is the resulting impact on trustee reporting and trigger monitoring?
4. Hybrid transactions expand the product landscape
Deals that were once confined to a single product now cross boundaries, integrating elements of bank loans, private credit, and structured finance. Issuers are doing this to optimize capital across various asset classes.
For trustees and agents working in this space, a single transaction can require managing CLO mechanics, loan agency conventions, and corporate trust obligations simultaneously. Coordinating these various disciplines from the earliest design stage can significantly reduce friction throughout the entire transaction lifecycle.
What we’re watching
- Which hybrid structures are becoming repeatable templates, and which are likely to remain bespoke?
- How are trustees organizing to service transactions that span multiple disciplines?
- Where do inconsistencies between different product regimes create the most significant downstream operational risk?
5. AI dominates technology discussions
AI is moving past speculative hype. We’re seeing initial traction in use cases like document review, loan tape scrubbing, and surveillance tools, with the range of applications continually expanding. However, a significant gap remains between demos and live. The emerging consensus is that AI is shifting from "in the loop,” where it hands tasks off to a human, to "over the loop" where humans oversee AI tasks.
From the trustee and agent perspective, the appeal is highly practical. AI could dramatically reduce the effort required for reporting cycles and bridge integration gaps across lender, issuer, and servicer systems. The consistent hurdle, however, is data readiness. Much of the securitization market’s foundational infrastructure wasn’t built for machine-readable processing.
What we’re watching
- Which AI use cases are currently delivering measurable operational efficiency in the securitization lifecycle?
- How are firms developing governance frameworks for AI outputs where accuracy is material to investor reporting or legal compliance?
- What role does machine-readable deal documentation play in creating AI-ready infrastructure across the market?
A consistent thread: Operational resilience
One common thread unified all five themes. Deal structures are becoming more complex, and the operational tolerance for error is tightening. Regulatory resilience remains an evergreen topic, such as the impact of new disclosure regulations on Residential Mortgage-Backed Securities (RMBS). Issuance is strong, capital is exploring new channels, and the transactions themselves are becoming more sophisticated.
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