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January 13, 2010updated 12 Apr 2017 4:28pm

BMW Financial Services launches ?800m bond (Free)

German vehicle manufacturer BMW is launching an 800 million bond backed by vehicle leases, amid signs that the securitisation market is returning to form. The first tranche, for 742 million, is rated AAA by Fitch Ratings and Standard & Poors, while the second tranche, of 58 million, is rated A by both ratings agencies.

By Jason T

German vehicle manufacturer BMW is launching an €800 million bond backed by vehicle leases, amid signs that the securitisation market is returning to form.

The deal is made up of two tranches. The first tranche, for €742 million, is rated AAA by Fitch Ratings and Standard & Poor’s, while the second tranche, of €58 million, is rated A by both ratings agencies.

BMW is currently conducting a roadshow around Europe to drum up interest from investors, according to an official at WestLB, one of the banks managing the sale.

The deal, known as Bavarian Sky, will be backed by German car leasing contracts, and is being managed by WestLB, Societe Generale, Commerzbank and Skandinaviska Enskilda Banken.

The ABS market opened back up towards the end of 2009, after the market dried up in 2008. Indeed, last November, Volkswagen Financial Services and Piraeus Leasing both issued leasing receivables worth a combined €1.1 billion.

Jason T Hesse

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