Weser Funding S.A. Compartment No. 2: 10 May 2020

The exclusive purpose of Weser Funding S.A. is to enter into several securitisation transactions, each via a separate compartment (Compartment) within the meaning of the Luxembourg Securitisation Law. The Compartment No. 2 Notes will be funding the second securitisation transaction.

The Compartment No. 2 Notes is a revolving cash securitisation backed by a portfolio of euro-denominated loans to small and medium-size enterprises located in Germany and other European countries. Whereas the initial portfolio has an aggregate par balance of EUR 1.1 billion, as per the transaction documentation, OLB does intend to increase the portfolio to EUR 1.3 billion by 31 December 2020 by issuing additional Class A Notes and Subordinate Notes.

The seller, Oldenburgische Landesbank (OLB Bank), is a Germany-based universal bank with full banking licence, offering retail and corporate banking business, and private banking and wealth management, and it has an established specialised lending business. OLB Bank has a balance sheet total of close to € 20 billion on a basis of more than € 1 billion in equity. The bank has been created through the merger of Oldenburgische Landesbank (OLB), Bremer Kreditbank (BKB), Bankhaus Neelmeyer (BHN) and the acquisition of Wüstenrot Bank AG Pfandbriefbank (WBP).

Eligibility criteria (includes): the Loan Receivable and its Related Collateral are freely assignable without any restriction against its assignment; the Loan Receivable is subject to German law and jurisdiction; the Loan Receivable is denominated in an amount payable in EUR; the Loan Agreement has been entered into exclusively with a Debtor which has its place of residence/seat in an Eligible Country; the Loan Receivable is not subject to any dispute, counterclaim or repurchase obligation; the Loan qualifies as an SME Loan.

As at the cut-off date (14 April 2020) the portfolio consisted of Loans and Promissory Notes and the transaction has a three-year revolving period which ends in May 2023, during which time OLB has the option to sell additional loan receivables to the Issuer on a daily basis as long as the eligibility criteria and replenishment criteria are complied with.

EU Risk Retention: The Seller will retain for the life of Transaction 2 a material net economic interest of not less than 5% in Transaction 2 in accordance with Article 6 (3) of Regulation (EU) 2017/2402 of the European Parliament. As of the Issue Date such interest will, in accordance with Article 6 (3) subparagraph (d), be comprised of the retention of the first loss tranche and other tranches having the same or a more severe risk profile than those transferred or sold to investors and not maturing any earlier than those transferred or sold to investors, so that the retention equals in total no less than 5% of the nominal value of the securitised exposures.

US Risk Retention: The issuance of the Compartment No. 2 Notes was not designed to comply with the U.S. Risk Retention Rules other than the exemption under Section _.20 of the U.S. Risk Retention Rules, and no other steps have been taken by the Issuer, the Originator or the Joint Lead Arrangers or any of their affiliates or any other party to accomplish such compliance.

Compare/contrast: Weser Funding S.A. Compartment No. 1