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NORD/LB and KfW Bankengruppe securitise new asset class
First synthetic securitisation of loans to East German housing companies
Frankfurt (ots) - With the "primus MULTI HAUS 2006" transaction, which is modelled on the basis of the established securitisation platforms of KfW Bankengruppe, NORD/LB has for the first time securitised the risks of a portfolio of loans extended exclusively to East German housing companies. The transaction is to be closed today.
"The positive assessments of the rating agencies and the huge interest from investors underline the attractiveness of our portfolio," said Jürgen Machalett, General Manager of NORD/LB responsible for corporate banking. The decisive advantage of such a securitisation is the released equity capital. "We will use these resources to extend further loans to the housing industry in East Germany", announced Machalett. "With this transaction the bank emphasizes its long-term commitment to the region".
Dr. Dieter Glüder, Head of Asset Securitisation of KfW, emphasized that, in addition to private and small commercial housing loans as well as SME and infrastructure loans, "primus MULTI HAUS 2006" is the first transaction conducted through KfW, under which loans to East German housing companies are securitised. He was pleased to see that this special asset class now also benefits from the positive impacts which the standardised KfW securitisation platforms have on banks' lending activities and the development of the capital market. "As this transaction follows the same standards as those established under our PROVIDE and PROMISE platforms, it is much easier for the rating agencies and investors to assess the transaction. This is the important advantage of standardisation, especially when introducing new asset classes to the market", explained Dr. Glüder.
The "primus MULTI HAUS 2006" transaction covers loans to finance the modernization of multi-family buildings in East Germany. With the involvement of KfW loans of a total volume of EUR 382 million are securitised in different tranches. The portfolio is composed of 133 loans extended by NORD/LB to altogether 24 housing companies. The longest remaining maturity of the individual loans is of around 30 years. The average ticket size is approximately EUR 2.9 million.
KfW takes the role of an intermediary in the securitisation transaction assuming the default risk of the underlying loan portfolios of NORD/LB. Simultaneously, the risk is transferred to the capital and swap markets. The largest part of the total securitisation volume, i.e. around EUR 256 million, is covered by a super senior swap concluded on between KfW and an OECD bank. Another part of EUR 126.6 million is hedged in the form of credit-linked notes (CLNs) via a special-purpose vehicle (primus MULTI HAUS 2006) established by TSI Service GmbH in Germany. The CLNs placed in the capital market were analysed and rated by the rating agencies Moody's and Standard & Poor's.
The transaction was arranged by NORD/LB and Banc of America Securities Ltd. and placed by Banc of America Securities Limited. The tranches were oversubscribed up to three times.
The prices of the individual tranches were fixed on June 6 2006 and are as follows:
** You find the complete press statement with the tabular overview
on our Homepage under www.kfw.de **
For more than 15 years NORD/LB, in cooperation with local savings banks, has acted as a well-regarded partner of the housing industry in East Germany. It has centralised its housing-sector activities in Magdeburg, thus presenting itself as a service provider for the housing industry covering all areas of the banking business. In addition, as a Landesbank with a regional focus it is actively involved in the "Urban Redevelopment Programme for East Germany" jointly implemented by the German government and the federal states and is a sponsor of the International Building Exhibition Saxony-Anhalt 2010. "The strategic orientation of the bank aims at both active support for the customers in mastering urban redevelopment in declining regions and the acquisition of new customers and new business in the growth regions of East German", adds Jens Zillmann, bank director in charge of the "Housing industry" unit in Magdeburg.
NORD/LB: Jan-Peter Hinrichs, Phone: +49-(0)511-361 9934, E-Mail: email@example.com
KfW Bankengruppe: Nathalie Drücke, Phone: +49-(0)69-7431 2098, E-Mail: firstname.lastname@example.orgOriginal-Content von: KfW, übermittelt durch news aktuell