The specialist buy-to-let lender said the landmark £400 million securitisation, Hops Hill No.1 PLC was the first to include an element of pre-funding – meaning a proportion of the issue included loans currently in the pipeline – since the start of the coronavirus crisis.
The mortgages securitised were originated under a forward flow agreement between Keystone and UK Mortgages Limited (UKML), a listed investment company managed by TwentyFour Asset Management.
Joint lead managers, Santander, National Australia Bank and Standard Chartered Bank (acting on behalf of UKML), achieved an impressive price of Sonia +95bps for the AAA senior notes.
Despite closing in the middle of the third national lockdown, there was huge demand for Hops Hill No.1 PLC among investors and the bonds were more than three times over-subscribed. This was due in no small part to the confidence in Keystone’s underwriting standards and the status and quality of the loan book.
Keystone and UKML will use the capital released from the deal to boost further lending and to bring new, innovative and competitively priced products to the broker market in 2021.
The specialist buy-to-let lender will utilise a second warehouse facility through UKML to provide it with further stable and secure funding during what remains uncertain times for both the mortgage market and the wider UK economy.
New MD
Meanwhile, Keystone also announced Elise Coole had been promoted from chief operating officer to the position of managing director with immediate effect.
Elise, who has over 15 years of experience in the world of credit and lending for many leading and respected brands including Commerzbank AG and Heylo Housing, is tasked with growing the specialist lender’s presence in the market and will play a leading role in deciding the firm’s future strategy.
Coole said: “This securitisation represents a landmark moment for Keystone and is another nod to the skills, capability and years of dedication put in by our superb team here in Kent.
“The fact we were able to attract such strong investment in the middle of a global pandemic is a testament to the quality of the lending the team here carry out on a daily basis and the confidence investors have in that process.
“This deal, and our second warehouse, gives us even more certainty during trying times for the mortgage market and the wider world and will allow us to bring exciting and competitively priced products to the broker market in the coming weeks and months.
“There is plenty more to come from Keystone in 2021 and we can’t wait to share this with our loyal brokers in the near future.”
Rob Ford, founding partner and portfolio manager of TwentyFour Asset Management, said: “We’re delighted with the relationship we’ve developed with Keystone over the last two years and the quality of the mortgage pool we built together was borne out by the overwhelming reception the securitisation received, despite the difficult times the world continues to endure.
“We are already looking forward to building a second portfolio, and furthering our relationship as we build out the product range.”
