Abbey National will use securitization as part of its effort to dispose of its nearly £40 billion bond portfolio, says an Abbey insider. Some of the bonds will be packaged into collateralized debt obligations, he says. The U.K. bank has announced its intention to exit wholesale banking and concentrate on its retail business. In addition, the bank will look to repackage and dispose of the collateralized debt obligations held on balance sheet, says the insider.
A spokesman says the bank has already sold off £7.7 billion in assets--including equities, leases, loans and other investments--since the beginning of the year. He declined to comment on Abbey's plans to sell off its bond portfolio.
Separately, Abbey's next Holmes deal is slated to hit the market this month, says the insider. Holmes 7 will be between £2.5 billion and £5 billion. J.P. Morgan Securities and Citigroup/Salomon Smith Barney are on the deal, says a firm insider. Abbey aims to bring the deal after the HBOS deal, but before Bradford & Bingley's, he adds.