UK challenger bank Investec is planning to launch a second securitisation bond on its small ticket loan book by the end of this year, according to a senior executive at the bank.
Mike Francis, head of asset finance at Investec, said that plans were advancing to launch its second securitisation vehicle.
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"We hope to get a second securitisation out targeting the small ticket lease book between £250m to £300m later this year. [There will be] the same mix of investors as the first securitisation," said Francis.
At the end of 2013 Investec launched its debut securitisation bond on its small ticket lease book, demonstrating a vote of confidence by the bank in the quality of its loans.
The £264m securitisation deal saw Investec sell bonds backed by £264m worth of SME equipment leases to a range of institutional investors.
The securitisation deal included almost 36,000 finance leases and hire purchase contracts providing asset finance to UK SMEs, said Investec.
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By GlobalDataThe deal was oversubscribed with investor orders of nearly twice the available bonds sold.
Francis said the small-ticket loan book ratings would make the second securitisation similarly attractive to investors.
"I think we have about 87% AAA as well, with pricing in the high 70 to 80 basis points, which is a good sign for investor’s perception of SME risk in the UK."
You can read a further in-depth interview with Investec’s Mike Francis in October’s Leasing Life magazine.
