Skipton set for RMBS of up to £550m

Skipton Building Society is to launch a securitisation backed by a pool of mortgage loans totalling between £450m and £550m.

The transaction, called Darrowby no 2, is made up entirely of prime residential mortgages originated by Skipton since 2001.

The average loan-to-value ratio is around 60%. The deal has not yet been priced, although this and the total pool size are likely to be decided next week.

Both Fitch Ratings and Moody’s have given the transaction a provisional AAA rating.

This is the second time the society has entered the securitisation market, the last issue being a £1.2bn bond called Darrowby no 1 in March 2011.

Societies have been particularly active in the RMBS market in the past two months, with West Bromwich, Coventry, Nationwide and Leeds setting up £410m, £1bn, £1.5bn and £250m bonds respectively.