MARF registers a new synthetic securitisation bond issue by Santander

Spanish Stock Market BME Bolsa de Madrid

The Alternative Fixed-Income Market (MARF) has registered a new synthetic securitisation bond issue launched by the Fondo de Titulización PYMES Magdalena 2, for a total amount of 166.3 million euros, Bolsas y Mercados Españoles (the Spanish Stock Market – BME) announced earlier today. This is the second time that Santander has registered an issue of this type with MARF, following a previous one in May 2017.

The Securitisation Fund has been incorporated by Sociedad Gestora Santander de Titulización and through this operation it will cover a 2.3 billion euro loan portfolio granted by Banco Santander or any of its subsidiaries in Spain. Banco Santander has acted as Arranger and Lead Manager of the bond issue, while Santander de Titulización will act as a Registered Advisor with MARF.

Clifford Chance has provided legal advice to the participants in the transaction regarding English and Spanish legislation.

The synthetic securitisation allows originating entities to transfer the credit risk associated with an assets portfolio through the acquisition of credit insurance, Credit Default Swaps -CDS-, and without the need to transfer ownership of the assets to a third party, as is the case with traditional securitisation operations. Additionally, in the case of synthetic securitisation of loans granted by financial institutions – and as long as the circumstances envisaged by banking regulations are met – the transferor releases the regulatory capital linked to the portfolio and, therefore, opens up the possibility of granting new credits.

Santander de Titulización, SGFT, is a Securitisation Fund Management Company incorporated in December 1992 and registered with the Special Register of the CNMV –the Spanish securities market supervisor. Santander de Titulización structures all types of funds: RMBS, SMEs, Consumer, CLOs, ABCPs, etc … and currently manages Funds that hold fixed income instruments issued with an outstanding balance in excess of 34 billion euros.

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