Dutch mortgage lender Bouwfonds Hypotheken, a subsidiary of ABN Amro, last week launched an MBS deal that was underwritten and managed by its parent company. Called Castle 1, the E200 million ($188 million) deal is backed by of a pool of around 5,700 loans with an average loan-to-value ratio of 67%. The mortgages were sold by Bouwfonds through brokers and insurance companies. Stater was brought in as servicer.
The deal employs a simple pass through structure. Credit enhancement of 5.5% for the senior A notes comes from subordination on the two junior tranches, excess spread and a reserve fund that will amount to 0.6% of the notes at closing. The B notes are protected by subordination on the C notes, which in turn are protected by the fund and excess spread.