A U.K. RMBS deal issued by Clydesdale Bank will offer investors three-year and five-year bonds.
The transaction, called Lanark Master Issuer Series 2012-2, is backed by a pool of U.K. prime residential mortgage loans originated by the bank and its wholly owned subsidiary Yorkshire Bank Home Loans. This represents the third issuance out of the Lanark Master Trust.
Moody's Investor Service has assigned provisional 'Aaa' ratings to the class A1 and A2 notes. It has not rated the class Z notes.
The rating agency said that a unique structural feature of the deal has to do with the 42% of offset mortgage loans in the pool, where the amount of interest charged on the mortgages is reduced according to the amount of savings held in a linked account at the bank. The deal also has a mechanism for Clydesdale Bank to compensate the issuer for the reduction in interest receipts, according to Moody's.