19 October 2016 – Expansión
Unión de Créditos Inmobiliarios (UCI), the financial credit company owned jointly by Santander and BNP Paribas, has packaged up 3,850 residential mortgages in Madrid, Andalucía and Cataluña to sell them in the market. To this end, it has structured a securitisation fund amounting to €420 million, of which €319 million will be placed with final investors, a tranche that has been assigned a high quality AA rating by Standard & Poor’s.
It is the third operation that the entity has undertaken in less than a year, as part of the Prado series. Given that UCI is regarded as a special lender, it is not able to approach the European Central Bank in search of financing, and so it is taking advantage of the reactivation of the securitisation market. In total, it has launched three securitisation funds amounting to €1,410 million during this period and a large part of the debt has been sold to investors. On this occasion, UCI is paying competitive prices, of 65 basis points above 3-month Euribor.
According to financial sources, the types of clients involved in this specialist kind of mortgage transfer tend to be those who are unable to access a normal bank, in other words, those who have more risky profiles. But in this securitisation, as S&P has highlighted, the loans are more robust than in standard securitisations because they have lower loan to values (loan amount over appraisal value).
Original story: Expansión (by D. Badía)
Translation: Carmel Drake