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Lloyds set to launch another RMBS deal

Lloyds Banking Group is set to launch its first securitisation backed by prime mortgages from Cheltenham & Gloucester and Lloyds TSB since the onset of the financial crisis.

The lender is to launch and price a residential mortgage-backed securities deal through its Arkle master trust programme at the end of next week.

Although Lloyds group has yet to officially price the deal, Fitch Ratings has put out a report valuing the transaction at £3.4bn.

The bank has already launched two securitisations over the last year through its Permanent programme, with the deals backed by HBOS-originated mortgages.

The first deal of £4bn was issued last September, with a second issuance in January worth £2.5bn.

But this latest securitisation from Lloyds group represents the first issuance backed by mortgages from C&G and Lloyds TSB rather than HBOS since May 2007.

It is made up of seven tranches, although only four are publicly offered.

The pool of loans backing the deal is made up of 315,535 mortgage accounts with a balance of £31.27bn and an average LTV of 65%.

As well as the earlier issuance from Lloyds group in January, this year has seen a £1.4bn RMBS deal from Santander’s Alliance & Leicester and a £2.5bn securitisation from The Co-operative Bank.






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  • Happy Investor/Banker 26th April 2010 at 9:40 am

    This type of deal must be very close to the FSA’s dream of ‘risk-free’? Average LTV at 65%, AAA rated and a coupon which could only be found at BBB just a few years ago.

    Happy days for investors and very happy days for the bankers who structure the no-brainer deal and make £millions in the process.

    But of crucial significance another much needed RMBS deal as we continue to address the liquidity shortfall in the mortgage market. However, a good deal more issues still required, with keener pricing, before the door is open for more specialist wholesale lenders to re-enter the market.