Barclays Capital is said to be shopping a three-year deal in what would be the first sign of primary issuance in U.K. RMBS sector since the market shut down over a year ago, according to market reports.
The RMBS could be issued from Barclays' existing Gracechurch master trust or from a stand-alone vehicle.
Issuance from the existing master trust would allay any concerns over extension risk because it would demonstrate that the master trust was able to refinance outstanding debt on schedule.
The deal will feature a bullet maturity, with a put option back to the issuer at par after three years.
Investors would get security over the highest quality collateral of any U.K. master trust as well as a pledge to buy back the bonds at par from one of the few U.K. banks that do not need the government's help.