Moody's Investors Service published an "unsolicited" comment  today that warned investors that it would not have assigned a 'Aaa' rating to the senior notes in the Royal Bank of Scotland's (RBS)  Isobel Finance No.1 PLC deal. This is Europe's first nonperforming real estate loan portfolio CMBS.

The £463.2 million ($747 million) deal was rated by Standard & Poor's earlier this month. It partially funds the purchase of legacy commercial real estate loans from bank balance sheets. The deal securitizes RBS' loan to Isobel (jointly owned by RBS and Blackstone) to partially finance the transfer of a nominal £1.4 billion portfolio from the RBS group's entities, according to S&P.

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