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Hoist Finance Has Received Commitment From CarVal for a Rated Italian Securitisation

STOCKHOLM, Nov. 5, 2019 /PRNewswire/ -- Hoist Finance is working towards closing a rated cash securitisation backed by a pool of Italian non-performing unsecured claims with a gross book value of EUR 5.0 billion as of the end of September. The transaction will have 85% senior and 15% subordinated notes. Hoist Finance will retain the senior notes in full, and additionally 5% of the subordinated notes. Funds managed by CarVal Investors LP have committed to subscribe the remaining subordinated notes. Senior notes are expected to be assigned an investment-grade rating and will carry an interest rate equal to 1.8%. Subordinated notes, covering the remaining 15% of the capital structure, will have a combined capped IRR of 15%. Excess collection from the assets will serve as credit support to all outstanding notes and thereafterA be paid to Hoist Finance as deferred purchase price.This is the second securitisation backed by Italian non-performing assets by Hoist Finance for capital relief purposes. In connection with the closing of this transaction, the notes of the inaugural unrated securitisation, closed in August, will be redeemed in full and its assets refinanced via the transaction announced today.The transaction is structured with a view to achieve significant risk transfer in accordance with Article 244 of Regulation (EU) No 575/2013 on prudential requirements for credit institutions and investment firms. The new rated securitisation is expected to result in a CET1 capital relief of approximately 20 bps in addition to the 60 bps released in August.
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