LONDON, June 09, 2023–(BUSINESS WIRE)–KBRA UK (KBRA) releases a research report examining the equity release mortgage (ERM) market in the UK and supportive demographic trends that signal potential expansion across the rest of Europe.
Ageing populations have resulted in an increasing number of retirees with meaningful value within their homes turning to ERMs for a variety of purposes, including leveraging the product to age in place. KBRA has received an increasing number of inquiries about ratings for securitisation transactions containing ERM collateral from both originators and investors. KBRA expects issuance of ERM-backed RMBS to continue rising in the UK and potentially expand in Europe. In the report, we highlight the key features and notable trends in this burgeoning corner of RMBS.
Key Takeaways
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Demographic trends within the UK and across Europe provide a supportive background for the development of ERMs as a product for later life lending.
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House price appreciation in the UK has provided a large store of wealth available as collateral for ERM lending.
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Securitisation of ERMs has developed from the initial programmes, as the product has become more mature and an industry association has established standard practices.
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The performance of recent UK transactions has generally been within expectations. Cumulative losses in recent transactions have tended to be very low to nonexistent, while credit enhancement has remained relatively stable or grown over time.
Click here to view the report.
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About KBRA
KBRA is a full-service credit rating agency registered in the U.S., the EU, and the UK, and is designated to provide structured finance ratings in Canada. KBRA’s ratings can be used by investors for regulatory capital purposes in multiple jurisdictions.
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Contacts
Kali Sirugudi, Managing Director
+44 20 8148 1050
[email protected]
Edward Tamiso, Senior Director
+1 (646) 731-1337
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Gordon Kerr, Head of European Research
+44 20 8148 1020
[email protected]
Edward DeVito, Senior Managing Director
+1 (646) 731-2319
[email protected]
Jack Kahan, Senior Managing Director
+1 (646) 731-2486
[email protected]
Business Development Contacts
Mauricio Noé, Co-Head of Europe
+44 20 8148 1010
[email protected]
Miten Amin, Managing Director
+44 20 8148 1002
[email protected]
