At press time last week the new issuance calendar for October had already reached E6.3 billion (US$7.39 billion) with a number of new deals building up in the pipeline. This should set Europe well on its way to reach predicted year-end issuance. Additionally, by mid-week, a further E3 billion (US$3.52 billion) of Spanish RMBS lined up for marketing.

Included among the new names is a E250 million (US$292.3 million) SME CLO for Banco Guipuzcoano, FTYMPE TDA-4. The capital structure will include four tranches including a triple-A rated piece backed by a Kingdom of Spain guarantee.

According to recent market reports, the Spanish government this year allotted an estimated E1.8 billion (US$2.10 billion) for SME CLO guarantees this year. The Royal Bank of Scotland estimated that approximately E810 million (US$947 million) has been used. With a recent heavy issuance calendar for these SME CLOs, Spain is rapidly reaching its saturation point.

Banco Pastor and Baco Sabadell are expected to follow with the E225 million (US$263 million) FTPYME Pastor 1 and the E500 million (US$584.6 million) FTPYME TDA Sabadell. On the RMBS front, industry sources indicated that a E1 billion (US$1.16 billion issue) for Banesto would begin marketing in the coming week.

Looking to its Iberian neighbour, Portuguese issues have also picked up a lot of steam this year. The second consumer loan from the country began marketing for Caixa Geral de Depositos (CGD), through Deutsche Bank. The E400 million (US$467.7 million) transaction, dubbed Nostrum, will include five pieces rated from triple-A to double-B. CGD is fully owned by the Portuguese state and counts retail and commercial banking as its most significant business operation - the new deal is the bank's first securitization issue. Nostrum's pool is backed by 97,189 loans with a 22-month weighted average LTV and a 10.1% weighted average interest rate, 27% of the pool is composed of second lien mortgages.

Dutch RMBS continues to build with the addition of the third Dutch RMBS transaction from GMAC-RFC Netherlands. The deal offers investors E474 million (US$559 million) of triple-A rated notes supported by a 5.8% initial credit enhancement. Three junior classes rated single-A, triple-B and double-B total a E13 million (US$15.2 million), E8 million (US$9.34 million) and E5 million (US$5.84 million), respectively.

Following its two sterling-denominated issues this year, MBNA Europe is offering investors three euro tranches backed by U.K. credit card receivables through its latest deal, CARDS 2003-C. The market is expecting E716 million (US$837 million) that will include a E630 million (US$736 million) triple-A piece, a E36 million (US$42 million) single-A piece and a E50 million (US$58.4 million) piece.

Investors got a better glimpse of the Eurohypo deal, which began marketing its E1.44 billion (US$1.68 billion) pan-European synthetic CMBS deal. Unlike its prior two structures, Europa III will issue its notes under a super senior swap totalling E1.079 billion (US$1.26 billion). The pool includes 47 loans on 57 properties with a weighted average LTV of 65.91%. No U.K. loans are included.

Royal Bank of Scotland also began preliminary marketing on its E500 million (US$590 million) Skye 1 Synthetic CLO Ltd. B, a synthetic CLO of European leveraged loans. Approximately E142 million (US$167 million) of rated notes are available, along with E52 million (US$61.4 million) of unrated subordinate notes.

Barclays Bank marketed the only sterling piece to circulate in the market last week. The GBP400 million (US$664.5 million) Gracechurch life finance is a reinsurance cover provided for a pool of life insurance policies originated by Barclays Bank plc and its subsidiary. Two triple-A rated pieces are being offered, and an Ambac provided wrap backs both. Barclays provides a GBP353 million (US$586.4 million) subordinated loan to the structure, adding credit enhancement for the note holders.

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