Chris Ratcliffe/Photographer: Chris Ratcliffe/Bl
Permanent Master Issuer, an established U.K. master trust program with mortgages of around £10.9 billion ($13.89 billion), is issuing Permanent Master Issuer PLC – Series 2024-1. This follows two series of notes issued in 2023.
Asset Securitization Report’s deal database gives the transaction’s expected closing date as January 31, 2024. The amount of the notes is to be determined.
Series 2024-1 benefits from the addition to the pool of around £1.4 billion ($1.79 billion) of new first lien prime owner-occupied mortgages originated by Halifax/Bank of Scotland, a subsidiary of Lloyds Banking Group.
According to Fitch Ratings, the pool of repayment mortgages has a weighted average (WA) sustainable loan-to-value (sLTV) of 70.6% and WA debt-to-income (DTI) of 29.8 %. The recent addition of less seasoned loans has slightly increased the WA sLTV since its previous issuance, Fitch said.
Credit enhancement (CE) available for the class A notes will be 10% at closing, provided by a reserve fund and the class Z variable funding note (VFN), Fitch said.
The documented minimum yield of the transaction is SONIA (Sterling Overnight Index Average) plus 1.2%, Fitch said.
Fitch expects a deteriorating outlook for U.K. prime RMBS in 2024, although low unemployment and solid wage growth to date will remain supportive of relatively low arrears for prime loans.
The note trustee and funding security trustee is the Bank of New York Mellon, the mortgages trustee is Permanent Mortgages Trustee, and the seller and servicer is Bank of Scotland.
Fitch expects to give the notes its highest rating of AAA.
