While German true-sale transactions have been rather limited, the country's synthetic securitization arena has been far more active recently. Enter the EURO1.75 billion Provide Home 2001-1, originated by DePfa Bank AG, a strong-bred synthetic that just might standardize future synthetic residential mortgage-backed securities in Europe.

The transaction is a securitization of German-based residential mortgages, a partial synthetic that is structured in four tranches that are rated triple-A to triple-B. Much like the series of German-based synthetic CLOs in Promise Plc, Kreditanstalt fur Wiederaufbau acts as an intermediary by selling protection on the reference portfolio and then hedging itself by buying protection via a credit default swap (CDS) and selling certificates of indebtedness to Provide Home, the SPV.

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