Securitisation

Kensington Completes Largest Public Securitisation Since Lockdown, Surpassing £1BN in Mortgage Bonds Since June

London, 24 July 2020: Kensington Mortgages, the specialist mortgage lender, has raised £650m of funding through the wholesale financial markets.

The deal - RMS32, issued via Kensington’s legacy funding shelf Residential Mortgage Securities – is the largest public residential mortgage-backed securitisation (RMBS) to be successfully sold to investors following the easing of Covid-19 lockdown restrictions.

Kensington is the first issuer to access the UK RMBS markets twice since the reopening of capital markets in mid-June. It has raised in excess of £1bn in the last month*.

RMS32 comprises seasoned non-conforming first charge and second charge residential mortgages. It will allow the refinancing of two existing Kensington legacy securitisations, RMS 28 and KMS 2007-1 that will be called in September.

The deal marks the 21^st UK RMBS deal issued by Kensington since its acquisition by Blackstone and TPG in 2015, bringing the total bond issuance to over £11.5 billion.

The deal has garnered strong demand from the majority of global ABS investors with a total of 17 unique investors across the tranches. It was oversubscribed across all tranches; both senior and junior bonds priced at the tights of any other recent deal brought by a specialist lender since June.

RMS32 is the last transaction of a series of 11 UK RMBS deals placed to the market since its re-opening mid-June evidencing the return of a functioning ABS market in the UK after having been closed for 3 months.

The transaction allows Kensington to secure more funding to support growing demand from its mortgage customers.