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West Bromwich and Investec restart RMBS transactions deferred in 2011

Investec and West Bromwich Building Society have relaunched the securitisations they postponed last year due to fears about conditions in the eurozone.

Last July, West Bromwich had postponed a £410m residential mortgage-backed securitisation, while Investec pulled a £204m transaction in November.

Both took the decision to shelve the transactions as a result of deterioration in eurozone market conditions.

The Investec transaction, Gemgarto 2012-1, is backed by a £202m pool of non-prime mortgages originated by its specialist lending subsidiary, Kensington Mortgages, since its return to new lending in November 2009.

The average LTV ratio of Gemgarto, which has been publicly placed, is 74.6% and the pool is made up solely of short-term fixed rate mortgages.

Derek Lloyd, head of structuring at Investec, says easing market conditions led the firm to relaunch the bond.

West Bromwich’s transaction, Kenrick No 1, was marketed to prospective investors last week, although the society says the size of the bond and its price is unlikely to be confirmed until this week. It has declined to comment further until the transaction is completed.
Fitch Ratings has given Gemgarto a AAA rating and an expected AAA rating to Kenrick based on the information it has received from West Bromwich.

Ray Boulger, senior technical director at John Charcol, says: “It is encouraging that these issues have been placed, given that the problems in the eurozone are ongoing.”

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