HSBC last week launched an $850 million CLO securitization, featuring both dollar and sterling floating rate notes. A portfolio of corporate loans originated by HSBC will back the deal, called Clover Funding No. 1. The bank will act as lead manager on the transaction.

The deal was split into four tranches, all with five-year average lives. The $750 million senior tranche, rated AAA/Aaa by Standard & Poor's and Moody's Investor Service, priced at 27 basis points over three-month Libor. The spread on the single-A rated GBP15.6 million ($24.9 million) B-class notes was 48 over. The GBP10.4 million C tranche, rated triple B, priced at 125 over and the spread on the GBP9.1 million D tranche, rated BB/Ba2, was 300 over three-month Libor.

The transaction uses a U.S. style master trust structure, which is unusual in the U.K.

Although the deal was still being closed press time, HSBC's head of asset-backed finance Tim Madigan was confident of its success. "The transaction has been very well received by investors," he said. "We're happy with the spreads and expect it to be fully subscribed in both the U.S. and Europe."

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