ABN AMRO's retail bank is about to launch a residential mortgage-backed securitization of Dutch mortgages that will mark its first use of securitization to sell prepayment risk. The deal will be about E500 million and will feature a fixed-rated passthrough component to allow the bank to sell prepayment risk, as well as a floating rate passthrough portion. The fixed-rate passthrough structure has been little used in Europe and this deal is an attempt to resurrect a securitization method commonly used in the U.S., according to a syndicate official with intimate knowledge of the transaction.
The deal has been mandated to Deutsche Bank and ABN AMRO as joint arrangers and bookrunners. Originally, the deal had been mandated to Deutsche Bank as sole lead arranger and bookrunner, however, bankers familiar with the bidding process say ABN was brought onto the deal after its securitization team made an appeal at the board level. James St. Johnstone, a syndicate official at ABN in London, declined to comment.