Just as the curtains close on 2001, the European market is welcoming another first with the debut of Portugal's new MBS, Magellan Mortgages No. 1 Plc, issued by Banco Comercial Portugues.

The EURO1 billion transaction is the first Portuguese securitization involving the sale and assignment of loan receivables backed by mortgage rights on residential properties located in Portugal. "What the new law did is create an on-shore structure; prior to this there really wasn't a structure to transfer assets domestically in a tax-neutral manner," explained Mark Lewis, head of MBS at ABN AMRO. "The ultimate change came in August when they finally addressed the tax withholding issue. Before that it was possible to do the deal but it just was not efficient." Lewis added that this "new" securitization law has been around for two years.

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