Dutch firm SNS Bank announced a new tender offer on possibly €1 billion of debt from its RMBS Hermes series.

The tenders bid consists of 23 tranches within six RMBS transactions from series VIII to XIII, all issued by SNS Bank.

“Although the tender is designed to buy some paper, more importantly it aims to provide market levels for revaluating the debt which has already been bought back by the issuer,” Societe Generale analysts said.

Dutch RMBS has been one of the most resilient sectors in terms of price action during the crisis. This was partly due to early buying from originators at distressed level. The tender closes on Sept. 17.

The tender offer is a continuation of a recent trend of such offers, which in late August saw Spanish bank Santander's tender offer on 27 tranches of 24 Spanish RMBS, CLOs and ABS transactions. The €16.5 billion bid of primary bonds have did not meet high demand and less than 4% of the original offer was accepted.

The total accepted nominal amount by investors was EUR 608.6 million,. Only two auto issues (acceptance above 9% of the theoretical bid-volume) and two consumer ABS (acceptance levels 6.6% and 8.7%, respectively), which featured the upper tender price range of 95-95.5% of par as well as some of the low performing UCI issues (acceptance levels from 1.16% to 7.1%) attracted notable demand.

Unicredit analysts said that the low participation rate is a sign of confidence regarding Spanish triple-A investments.

“In our view, the outcome shows that investors are quite confident with respect to Spanish triple-A’s and see no reason to sell without significant pick-up potential,” analysts said. “Overall, the tender price levels of those bonds that achieved high acceptance levels did not differ very much from secondary market prices.”  

They added that the low acceptance rate underlines that the seller overhang on the structured finance market has come to an end also in Spain. This is a market sector that is exposed to comparatively higher fundamental downside compared with other European jurisdictions. The need to sell and liquidate ABS at any cost is clearly over as technical pressure has abated.


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