The specialist lender said the latest deal, which was issued by its legacy funding shelf Residential Mortgage Securities, was the largest public residential mortgage-backed securitisation (RMBS) to be successfully sold to investors following the easing of Covid-19 lockdown restrictions.
What’s more Kensington said it was the first issuer to access the UK RMBS markets twice since the reopening of capital markets in mid-June. It has now raised in excess of £1bn in the last month.
The most recent deal, known as RMS32, involved 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 in September.
It also marks the 21st 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.
Kensington said there was strong demand from many global ABS investors and it was oversubscribed across all tranches.
Alex Maddox, capital markets & digital director, said: “Since the markets reopened in June, the RMBS market has seen a flurry of activity. This deal’s oversubscription and the fact that we were able to follow a more standard syndication process demonstrates investor appetite for our funding and the strength of our underlying business.”
He added: “We anticipate the recently announced temporary stamp duty changes will help to kickstart the housing market and increase demand for mortgage products that are tailored and suited to individual’s needs.
“In this uncertain climate, people require pragmatic lenders who are able to take the long view.”
