Tower Bridge Funding No.1: 19 October 2017
This will be the first public securitisation from Belmont Green. The issuer will make payments on the notes from payments of principal and revenue received from a portfolio comprising mortgage loans originated by BGFL under its trading name Vida Homeloans, secured over residential properties located in England and Wales.
Belmont Green Finance Ltd is a company whose purpose is advancing or acquiring residential mortgage loans to borrowers in England and Wales. BGFL is a wholly owned subsidiary of BGFL Limited, the majority (98.8%) of whose share capital is owned by Pine Brook Capital Partners II (Cayman) AV LP.
Eligibility criteria (includes): each Loan must be secured by a first ranking legal mortgage (a “Mortgage” over a freehold or leasehold residential property) in England or Wales; loans will be granted on residential property offered as acceptable security in England and Wales subject to acceptable valuation. Use of all properties will be for residential purposes as a private dwelling only; minimum property valuation for Owner Occupied Properties is £70,000 for all property types, £125,000 for ex local authority flats/maisonettes outside of Greater London and £200,000 for ex local authority flats/maisonettes within Greater London; minimum property valuation for Buy-To-Let Properties is £50,000 for all property types, £125,000 for ex local authority flats/maisonettes outside of Greater London and £200,000 for ex local authority flats/maisonettes within Greater London; unacceptable tenure includes: leasehold houses, flats and maisonettes with less than 40 years lease remaining from the date on which the Loan was originated for Repayment Loans or not less than 70 years lease remaining from the date on which the Loan was originated for Interest Only Loans.
For the full list of lending criteria, please see the relevant section in the final offering circular.
At the cut-off date (30 September 2017) the provisional pool consisted of 996 loans, where the current average balance is £202,338 and the largest loan is for £862,934. All were subject to a full internal and external inspection. Occupancy type (by current balances): BTL 66.92%, owner-occupied 33.08%. Repayment type (by current balances): interest-only 71.01%, repayment 28.21% and P&P 0.78%. Interest Rate type: fixed to floating 90.06%, floating (for life) 9.94%. Loan purpose: re-mortgage 53.35%, purchase 45.61%, right to buy 1.04%. The WA current LTV is 69.50% (original LTV 69.54%) and the WA seasoning is 1.96 years. Regional concentration: Greater London 40.96%, South East 17.72% and East of England 14.94%. Additional information: self-employed account for 41.35% of balances; CCJs account for 13.99% of balances.
CRR 405: BGFL, as an originator for the purposes of the CRR, the AIFMR and Solvency II, will retain, on an ongoing basis, a material net economic interest of at least 5% in the securitisation in accordance with Article 405 of the CRR, Article 51 of the AIFMR and Article 254 of Solvency II. In order to satisfy the Retention Requirement on the Issue Date, BGFL will hold exposure to the Z1 Notes and the Z2 Notes.
U.S. Risk Retention Rules: BGFL, as the sponsor under the U.S. Risk Retention Rules, does not intend to retain at least 5% of the credit risk of the securitised assets for purposes of compliance with the final rules promulgated under Section 15G of the Securities Exchange Act of 1934, but rather intends to rely on an exemption provided for in Section 20 of the U.S. Risk Retention Rules regarding non-U.S. transactions.
Volcker Rule: The Issuer is of the view that it is not now and, immediately following the issuance of the notes and the application of the proceeds thereof, it will not be a “covered fund” as defined in the regulations adopted under Section 13 of the Bank Holding Company Act of 1956, commonly known as the “Volcker Rule”.
Compare/contrast: Finsbury Square plc 2017-2, Together Asset Backed Securitisation 1