ZOPA has embarked on the third securitisation of its loans, days after confirming that it has raised £140m from institutional backer IAG Silverstripe to help launch its bank.
This latest securitisation, which is expected to be priced later this week, is arranged by Deutsche Bank, which is also serving as joint lead manager alongside Standard Chartered Bank. Target Servicing Limited will act as the back-up servicer.
67 per cent of the loans are expected to be in the A1 class meaning that they have received a DBRS/Fitch ratings of AAA. A further 10 per cent of loans will be rated AA/AA-, while the remaining 18.5 per cent of loans will be rated A- or lower.
M&G Specialty Finance and Prudential Loan Investments have pledged to subscribe for the loans and will hold 50 per cent of the minimum retained amount.
The securitisation will be listed on the Irish Stock Exchange and will reach final maturity in December 2028.
According to the securitisation paperwork, as at 31 October 2019 Zopa had a total number of loans of 32,160, with a total original balance of £246.95. and a total outstanding balance of £224.68m. The weighted average interest rate on the loans is 8.95 per cent, and there is an average of 44.22 months remaining on the term time.