Azure Finance No.2 plc: 29 July 2020
As the name suggests this will be the second securitisation from the originator, where the Issuer will make payments on the notes and the Residual Certificates from a portfolio comprising receivables under or in connection with HP Agreements originated with borrowers by Blue Motor Finance Limited, which will be purchased by the Issuer on the Closing Date. These HP Agreements provide for equal monthly payments over the term of the agreement (with the exception of the last payment, which may include certain fees). The Portfolio will not include PCP Contracts.
At the cut-off date the portfolio consisted of 23,195 agreements, where the average current outstanding principal balance is £8,420 and the largest is for £59,451. Vehicle type (by current balances); used – 98.71%, new – 1.29%. Regional concentration: South East – 16.30%, North West – 14.16%, Scotland – 13.77% and Greater London – 11.23%.
Significant investor(s): Blue will, on the Closing Date, acquire at least 5% of the Outstanding Note Principal Amount of each Class of Collateralised Notes (such Notes representing the Retained Interest). In addition, Blue will, on the Closing Date, acquire 100% of the Outstanding Note Principal Amount of the Class X2 Notes and 100% of the Residual Certificates.
Citigroup Global Markets Limited, as a purchaser from the Joint Lead Managers, may or may not acquire (and initially hold) 95% of each Class of Collateralised Notes and 100% of the Class X1 Notes on the Closing Date. CGML is free to deal with such Collateralised Notes and the Class X1 Notes in its sole discretion.
EU Risk Retention: On the Closing Date and while any of the Notes remain outstanding Blue will, as an originator for the purposes of Regulation (EU) 2017/2402, retain a material net economic interest of not less than 5% in the securitisation as required by Article 6(1) of the Securitisation Regulation. As at the Closing Date, the Retained Interest will comprise Blue holding at least 5% of the nominal value of each Class of Collateralised Notes sold or transferred to investors on the Closing Date, as required by Article 6(3)(a) of the Securitisation Regulation.
US Risk Retention: The Seller, 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 U.S. 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.
STS: The Seller, as originator, will, on or about the Closing Date, procure a notification to be submitted to ESMA, in accordance with Article 27 of the Securitisation Regulation, and the FCA, that the requirements of Articles 19 to 22 of the Securitisation Regulation have been satisfied with respect to the Notes.
Compare/contrast: Azure Finance No.1 plc, Bavarian Sky UK 3 plc, Dowson 2020-1 plc