Mecenate 2 S.r.l

This transaction will be the second securitisation of performing Italian residential mortgage
loans originated by Banca Popolare dell’Etruria e del Lazio, the original deal closing as far
back as March02. Banca Etruria also brought a leasing transaction to the market in March04
through its Etruria Leasing unit (offering circulars for both transactions available on EuroABS).

Banca Etruria is a small sized regional Italian limited liability co-operative bank based in Arezzo,
Tuscany, with its major presence in central Italy where it has 174 branches. It operates in six
divisions: Banking, Leasing, Real Estate and Computer, Collection of Taxes, and Financial Serv-
ices and Consulting. In the Banking division, the group engages in commercial and corporate
banking activities. In the Leasing division, it operates in the equipment, automobiles, and real
estate leasing sectors.

The reference portfolio consists of 8,083 first ranking and performing mortgage loans, mainly
concentrated in central Italy (95.67%), where 57.51% of the total loans are in Tuscany and
24.98% in Lazio. However, the deal does show good granularity with the top 20 obligors acc-
ounting for just 1.72pc of the pool. WA seasoning is an extremely high 35.26mnths ( recent
comparisons: Capital Mortgages 13mnths, BP Mortgages 3yrs), with a current WA LTV of
43.68%. One point of interest, and potential caution is that the portfolio includes a high percent-
age of loans paying semi-annually (50.3%).

After initial talk on terms/conditions, the deal had a shift in average life with the A class reduced
down to 5.35yrs from the initial 6.82yrs and the B/C class reduced to 9.16 from 11.0yrs, with
differences on pre-payment rates being identified. Although beneficial, the pricing levels mirror-
ed the pre-market talk with the AAA printing at the same level as recent offerings from BP Mort-
gages and Claris. Further down the capital structure targets were again met but reflected a
slightly weaker trend emerging for lower rated debt.



Compare/contrast: Mecenate 1, BP Mortgages, Claris 2007