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Three lenders issue securitisations

Coventry and Investec have successfully issued securitisations in the past week while West Brom has issued a deal into the market likely to be confirmed next week.

Sarah Davidson and Yuan Phoon, 26 April, 2012

The Coventry issued a £1.1bn securitisation for the first time called Leofric No.1.

The portfolio consists of a pool of prime owner-occupied mortgages originated by the mutual and its intermediary arm Godiva Mortgages.

The average loan to value of the mortgages of the pool is around 64%.

JP Morgan and RBS are joint book runners on the deal which will be the first standalone residential mortgage-backed security transaction from a UK building society since Principality debuted with its £686m Friar No. 1 last August.

Kris Gozra, head of structured finance and funding at Coventry, said a key benefit of the Residential Mortgage Backed Security was its decoupling from sovereign risk, which meant it carried less price volatility.

Meanwhile Investec had more luck getting its securitisation fully subscribed after having to postpone last year due to lack of demand.

The Investec transaction, Gemgarto 2012-1, is backed by a £202m pool of non-prime and Buy-to-let mortgages originated by its specialist lending subsidiary Kensington Mortgages between 2010 and late 2011.

The average loan-to-value ratio of Gemgarto, which has been publicly placed, is 74.6%.

Investec head of structuring Derek Lloyd said the deal had "good healthy levels of interest" from five separate investors and the AAA-rated notes were oversubscribed by two times.

It was priced in late March at 295bps above LIBOR.

West Brom joined the fray and confirmed its securitisation Kenrick No 1 was marketed to prospective investors last week.

It follows last July's decision to postpone a £410m residential mortgage-backed securitisation.

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