The Easter break may have tamed the flood overtaking European primary issuance, but it was only a brief rest. Very little began actively marketing last week but based on announcements of what's in store for the rest of April, the market looks ready for another pickup in primary volume.
Primary and secondary market flows were relatively light last week with clearing levels among primary subordinated bonds pricing moderately wider relative to recent prints. According to market reports, senior bonds remained well bid and still priced at the tighter range of talk. However, the pipeline looked its lightest since the beginning of the year with only around 30 billion ($40.4 billion) of printed paper. The bulk of the pipeline was defined by
non-consumer deals. Pricing in the vanilla sectors will likely be better supported technically in the next few weeks.
Several new RMBS deals backed by collateral from across the continent were announced last week. Bradford & Bingley's prepped its fourth U.K. RMBS, Aire Valley 2007. The deal is expected to total GBP2 billion ($3.9 billion) in size and will begin marketing later this month with pricing slated for the end of April. Barclays Capital, Citigroup and UBS are book runners in all tranches except the 1A1 piece that is being led solely by the Royal Bank of Scotland. The portfolio comprises buy-to-let, self-certified and mainstream loans. Also coming to market for the fourth time is a mixed MBS deal from Bancaja, which will total 1.85 billion. The portfolio consists of 18,961 loans granted to individuals secured by a first-lien mortgage guarantee, 91% of which are secured on residential and 8% on commercial properties. The pool has a weighted average LTV of 61% and 1.21-year seasoning. BNP Paribas, Deutsche Bank Securities and Societe Generale are co-leads on the deal.
Bookrunners also announced Capital Mortgages 2007-1, the 2.5 billion Italian RMBS for Banca di Roma (Capitalia Banking Group). The pool comprises 22,633 prime residential mortgage loans granted in Italy with a weighted average LTV of 64.55%, 13-month weighted average seasoning and geographic concentration in North of Italy and Central Italy. HSBC and Morgan Stanley were selected as leads on the deal.
Underwriters also began marketing the 2.1 billion German true sale securitization Geldilux-TS-2007. The deal references 2,067 short-term, granular euro-denominated loans to 1,642 corporates, SMEs and private individuals. The pool has an average seasoning of 28 days. HVB is structuring the deal.
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