ONE Savings Bank PLC : Acquisition of UK 2nd ch...
25 March 2015
ONESAVINGS BANK PLC
Acquisition of UK 2nd charge mortgages (the "Transaction")
OneSavings Bank plc (the "Group") today announces that it has completed the purchase of a portfolio of UK 2nd charge mortgages (the "Portfolio").
The mortgages are being acquired from a major global financial services organisation which ceased originating UK 2nd charge mortgages in 2008 but has been continuously managing the Portfolio.
The Portfolio consists of unregulated UK 2nd charge mortgages with a current balance of £251m as at 31 December 2014. The Portfolio is being acquired at a small premium to par reflecting attractive characteristics including:
- Weighted average interest rate above 9%.
- Weighted average current loan-to-value of around 70%.
- Predominantly performing loan book.
- Well diversified across the UK regions.
The Transaction is in the ordinary course of the Group's business and has been satisfied by cash from the Group's resources. The Portfolio will add to the Group's overall loan portfolio of £3.9bn as at 31 December 2014. The Group continues to maintain a CET1 ratio well above its minimum risk appetite of 10%.
The full transfer of legal title and servicing will take place over a period of approximately 4-6 months. The sale will not affect the terms and conditions of the mortgages in the Portfolio and the borrowers will be contacted directly by the Seller and the Group at the time of servicing responsibility transfer.
Commenting on the Transaction, CEO of OneSavings Bank, Andy Golding said:
"The addition of this loan book is consistent with our overall strategy for the Group. Organic origination remains the key driver of our growth but we evaluate inorganic opportunities as they arise. We have disciplined investment criteria and make acquisitions where there is a fit in terms of strategy, risk profile and projected financial returns."
Group Commercial Director, Jens Bech added:
"This portfolio provides us with meaningful expansion of our second charge mortgage book, an attractive segment in which we have origination expertise. I am confident, given our success in integrating other loan portfolios, that we will be able to leverage our cost efficiency and asset management capabilities to generate value whilst ensuring fair treatment of customers".
Enquiries:
Investors:
OneSavings Bank plc: Shomik Banerjee, Head of Investor Relations t: 01634 835 728
Media:
Brunswick Group: Robin Wrench / Simone Selzer t: 020 7404 5959
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: ONE Savings Bank PLC via Globenewswire
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