Landmark mortgage-backed securitisations have closed in Taiwan and Singapore, as the region continues to embrace the financing technique.
In Taiwan, which enacted its Financial Asset Security Regulations in June 2002, Deutsche Securities Asia Limited acted as lead arranger on the jurisdiction's first residential mortgage-backed securitisation (RMBS) deal.
Allen & Overy partner Kenneth Aboud led the Singapore-based Allen & Overy Shook Lin & Bok JLV advising Deutsche Securities in Taiwan with Lee and Li advising on Taiwanese law matters.
The NT$4.57bn (US$140m) issue of trust certificates was backed by a pool of first-ranking mortgage loans secured over residential properties located in northern Taiwan. The trust certificates were issued via First Commercial Bank 2003 Special Purpose Trust (SPT) on 2 March.
The RMBS issue comprised four classes of trust certificates: Class A was a NT$3.91bn issue of trust certificates rated 'twAAA' by Taiwan Ratings Corp, the Taipei-based affiliate of Standard & Poor's. Class B and Class C were issues of NT$220m and NT$150m trust certificates, rated 'twAA' and 'twA' respectively, while Class D was an unrated issue of NT$292m trust certificates.
Aboud said: "This deal represents a significant milestone for the local securitisation market."
Before the Taiwan RMBS issue, the Allen & Overy Shook Lin & Bok JLV recently acted for BNP Paribas and OCBC as managers of a Singapore commercial mortgage-backed securitisation (CMBS) for CapitaLand, one of Asia's largest property development companies.
That issue raised S$116m (US$69m) in four tranches of notes but in March, CapitaCommercial Trust (CCT), a real estate investment trust established by CapitaLand, topped this with its maiden fundraising. In a deal worth S$580m (US$343m), CCT issued four classes of CMBS by special purpose vehicle Silver Loft.
Partners Dilhan Pillay, Monica Yip, Karen Wee and Hui Choon Yuen led the WongPartnership team advising Bayerische Hypo-und Vereinsbank AG as lead manager and DBS Bank and JP Morgan as co-managers on Singapore's largest ever CMBS issue. Partner Angela Lim led the WongPartnership team advising Silver Loft on what was also the jurisdiction's first rated commercial office CMBS.
Allen & Gledhill represented CCT with partners Margaret Chin and Jerry Koh leading its team.
CCT's four classes of CMBS were US dollar denominated notes, due 2010, backed by the cashflow and assets from its initial seven properties - namely, Capital Tower, 6 Battery Road, Starhub Centre, Robinson Point, Bugis Village, Golden Shoe Car Park and Market Street Car Park.
Fitch, Moody's and Standard and Poor's rated the four classes as follows: AAA/Aaa/AAA for Class A1 and A2, AA/Aa2/AA for Class A3 and A/A2/A for Class A4.