U.K. bank Tesco Personal Finance Group plans its first securitization of U.K. Visa and MasterCard credit card receivables of the year, according to a Standard & Poor’s presale report.
S&P expects to assign 'AAA' ratings to two tranches of class A notes to be issued under the Delamare Cards MTN Issue Series 2014-1. The Class A1 notes rated have a scheduled redemption date of May 19, 2017 and are due May 19, 2019; and the Class A2 notes have a scheduled redemption date on May 19, 2019 and are due May 19, 2021. The size of the traches have yet to be determined, accoring to the presale report.
At closing the trust will issued a class of variable funding notes that will note be rated by S&P will provide subordination to the class A notes.
TPFG, is a wholly-owned subsidiary of Tesco, a British multinational grocery and general merchandise retailer. The bank was established in 1997 as a joint venture between Tesco and RBS. In December 2008, Tesco acquired RBS' 50% shareholding to become TPFG's sole shareholder.
The securitized portfolio consists of approximately £2.7 billion of eligible account receivables, which are on either the Visa or MasterCard payment processing network. The bank offers its Clubcard-branded credit card products with a combination of an introductory interest-free balance transfer and purchase propositions. The duration of the introductory periods differentiates the individual products, according to the presale report.
The securitized pool also includes receivables that may originate on legacy products such as classic, platinum, and bonus card accounts.
This will be Delamare Cards MTN Issuer PLC's third issuance of notes backed by credit card receivables. Citigroup is lead arranger in the deal.