Denizbank is joining the recent spurt of activity by Turkish banks in the DPR sector. The originator has scheduled a transaction for up to $200 million for the end of this week via sole lead Merrill Lynch, according to a source. The legal final maturity is five years and Moody's Investors Service has given the paper a preliminary rating of Baa3.'

The deal is backed by all existing and future dollar-, euro-, and sterling-denominated payment orders received by Denizbank. The volume of those flows multiplied by three times between 2002 and 2004, according to a report by Moody's. Part of that explosive growth has been fed by business from the Zorlu group, a leading Turkish conglomerate and Denizbank's majority-owner. The originator's DPR flows totaled $6.98 billion in 2004 up from $2.16 billion in 2002.

The transaction allows for future issuance, as long as certain limits are not breached. The program is capped at a 10 times debt service coverage ratio of tested collections for each of the four quarters preceding the new issue date. The twelve designated correspondent banks in the transaction represent Denizbank's main clearing banks, executing 93% of payment orders in dollar terms during 2004.

The deal has the following early amortization triggers: when either quarterly tested collections debt service coverage falls below six times, monthly-tested collections debt service coverage falls below four times, collections for two consecutive quarters slip below 60% of the same periods in the preceding year and the quarterly tested collections debt service coverage is below 12 times for both quarters.

(c) 2005 Asset Securitization Report and SourceMedia, Inc. All Rights Reserved.

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