PTSB issues 5,000 home loans

The majority government-owned Permanent TSB will sell a portfolio of mostly buy-to-let mortgages in a so-called securitization deal involving nearly 5,000 borrowers, as well as US bond investor Pimco and debt service Pepper.

Typically, only 6 percent of mortgages are classified as non-performing. The portfolio generated gross interest income of €14 million and an operating profit of €2 million last year.

The transaction involves the sale of a pool of 5,170 leased credit accounts secured on 6,195 properties. The loan accounts are linked to so-called 4,915 loan relationships – which can have a single or joint debtor.

The bank said the portfolio had a gross balance sheet value of around €770 million, a net book value of €700 million and an overall risk-weight intensity of around 65 percent. About 86 percent of the loans are on a tracker, 12 percent are on a variable product and remain on a fixed income product.

The transaction will be funded as a securitization through a vehicle called the Glenbeigh 4 Seller DAC, to be funded by funds managed by Pacific Investment Management Company (PIMCO) and arranged by Citibank.

PTSB will use the €700 million raised for general corporate purposes including the completion of the Ulster Bank transaction.

Customers whose loans are included in this transaction will continue to enjoy the same post-sale regulatory protections under the Consumer Protection Code (CPC) and the Code of Conduct on Mortgage Arrears (CCMA).

The loans will continue to be serviced by PTSB for a period of up to six months and then transferred to Pepper Finance Corporation.

For PTSB, the deal will increase its capital ratios and bring in additional cash up front. PTSB issues 5,000 home loans

Fry Electronics Team

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