“Subprime mortgages that helped fuel the U.K. housing boom are making a comeback in thebond market even with Prime Minister David Cameron cutting spending by the most since World War II and the jobless rate at a 16-year high.
Credit Suisse Group AG (CSGN) sold bonds backed by more than 340 million pounds ($540.8 million) of non-conforming home loans last week in the first deal of its type since May, according to data compiled by Bloomberg. Apollo Global Management LLC, which acquired the mortgages in 2010, is using its servicing business Lapithus Group to help collect on the loans and will keep the riskiest part of the transaction, meaning it’s in line for the highest possible returns, according to an investor presentation….”
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