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12.08.2003 – 11:42

KfW

Egg Banking plc and KfW securitise Residential Mortgage Loans with a Volume of GBP 1.75 bn
First PROVIDE Transaction with a non-German bank.

    Frankfurt/Main (ots)

Egg Banking plc and KfW have concluded their first non-euro securitisation of risks from residential mortgage loans via the platform PROVIDE (Provide Release 2003-1). The synthetic assumption and channelling of the portfolio risk onto the capital market will be carried out by KfW. Overall the securitised portfolio comprises 31,890 individual loans with a nominal volume of GBP 1.75 billion. The arranger and manager of the transaction is Merrill Lynch International. In this transaction, credit linked notes will be issued by the special purpose vehicle Provide Release 2003-1 plc in a total volume of over GBP 42.25 million and placed with international investors by Merrill Lynch International.          With its platforms for the securitisation of SME loans (PROMISE) and residential mortgage loans (PROVIDE) KfW gives all credit institutions the opportunity to securitise credit risks under a highly standardised scheme. The equity relief thus achieved creates greater scope to grant new loans. Additionally, KfW is making an essential contribution to the development of trading in risks resulting from SME and residential mortgage loans.          PROVIDE Release 2003-1 is KfW's second securitisation transaction with a European bank. In December 2002 Bank Austria was the first non-German bank to securitise risks from loans to small and medium- sized enterprises through KfW's PROMISE platform in a volume of around EUR 1 billion.          KfW is prepared to make its securitisation platforms available as a standardised instrument to suitable institutions with appropriate loan types in other European countries. The inclusion of European portfolios could further increase the liquidity of the platforms. In addition, the platforms could contribute to compensating for the fragmentation of the European securitisation market, which has resulted from the various national legal systems.          The prices for the credit linked notes to be issued under Provide Release 2003-1 were fixed on August 4, 2003.          Provide Release 2003-1

    Tranche      Nominal amount      Ratings        Premium
                      (in GBP)              (S&P/Fitch)

    A+              250.000                 AAA/AAA         3-M-GBP-LIBOR + 40 bp
    A          22.750.000                 AAA/AAA         3-M-GBP-LIBOR + 40 bp
    B          11.250.000                    AA/AA         3-M-GBP-LIBOR + 65 bp
    C            8.000.000                        A/A         3-M-GBP-LIBOR + 85 bp

ots Original Text Service: KfW Internet: http://www.presseportal.de           For more Information please contact: Ms. Nathalie Drücke Telefon: +49 (0)69 7431-2098 E-Mail: nathalie.druecke@kfw.de

Original content of: KfW, transmitted by news aktuell