NRAM annoys investors as it tenders then redeems at par
Northern Rock Asset Management announced on Thursday that it plans to terminate the CDS swap with KfW for its Provide Graphite 2006-1 synthetic RMBS. As a consequence, it will redeem all the credit-linked notes at par on August 10, which is the next interest rate payment date.
Its decision to redeem the notes at par is likely to come as a surprise to many investors, given that it had recently indicated that an early redemption at par "would not be in its economic interests".However, the sponsor had also said that a tender offer, which ...
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