Keystone Property Finance has completed its sixth securitisation, Hops Hill No. 6.
The latest transaction totals £400m of buy to let mortgages, comprising £320m of completed loans and an additional £80m of loans currently in the pipeline that will be added during the prefunding period. This securitisation takes the total issuance under the Hops Hill programme to over £2 billion.
Investor appetite remained strong across the capital stack. The Class A AAA-rated notes were priced at Sonia + 84 basis points, while the Class B and C notes were both more than 3 times oversubscribed and priced at Sonia + 100 and Sonia + 130 respectively.
The strong demand and favourable pricing reflect investors’ confidence both in the quality of Keystone’s loan book and the wider buy to let market.
Lloyds and BNP Paribas acted as joint lead managers on behalf of UK Mortgages Corporate Funding DAC, advised by TwentyFour Asset Management. Keystone acts as servicer on the transaction.
The deal is the latest in a series of major recent milestones for Keystone. Over the past 12 months, the lender has branched into new lending areas – Refurb to Let and semi-commercial – invested heavily in its technology and, in January, broadened its funding base with a third funding line from a well-known international investment bank.
Elise Coole, Managing Director at Keystone Property Finance, said: “Completing our sixth securitisation is a significant moment for Keystone and a reflection of the consistency and quality of our lending. The funding relationship with TwentyFour Asset Management has been in place for over 8 years and thanks to their continued support the Hops Hill programme is now a well-recognised name in the UK securitisation market.
“The continued support we see from investors speaks to the confidence they place in our underwriting and the performance of our loan book. It also reflects the resilience of the funding base we have built, which gives us the firepower to keep strengthening our proposition and support a wider range of landlords in what is a fast-moving and evolving market."
Shilpa Pathak, Portfolio Manager at TwentyFour Asset Management, said: “We are delighted to have partnered with Keystone once again on the sixth securitisation under the Hops Hill programme. The platform has been consistently successful, and that success is underpinned by a highly experienced management team and a strong, disciplined approach to underwriting, qualities that are clearly reflected in the quality of the loan book and its consistent performance.
"Hops Hill No.6 is a further demonstration of that strength and we look forward to continuing our long and fruitful partnership with Keystone."
