investing > ARA Venn prices its sixth RMBS transaction

ARA Venn prices its sixth RMBS transaction

  • First publicly placed Dutch prime RMBS transaction since January 2020
  • Transaction attracts huge investor demand to achieve significantly tighter pricing

Venn Partners LLP (“ARA Venn”), an investment manager of residential mortgages and real estate debt, is pleased to announce the successful pricing of its sixth RMBS transaction (“Cartesian 5”).

The €300m transaction brings the total outstanding issuance under the Cartesian Dutch RMBS programme to €1.4bn, of which €1.2bn relates to collateral originated by ARA Venn’s affiliated mortgage platform, Venn Hypotheken BV.

Cartesian 5 is ARA Venn’s first since July 2019 and marks the first publicly placed Dutch prime RMBS issuance since January 2020.

Building on its growing reputation and scale as well as the low levels of European ABS issuance since March, the deal capitalised on significant investor demand for high-grade credit product to secure over €1.5bn of orders (over 5x covered) for the AAA bonds whilst pricing more than 15bps inside the initial price guidance. The AAA notes eventually priced at 3-month Euribor plus 55bps. Cartesian 5 also comprised three mezzanine tranches of risk. The deal was rated by Fitch and DBRS, and BNPP, Citi and SMBC acted as JLMs.

Following a three-day virtual roadshow to a broad investor base, 31 new and existing investors participated in the final allocation, across a range of sectors and jurisdictions.

With AUM and active mandates in excess of £5bn, ARA Venn also operates in the UK residential market, where it manages a government-guaranteed lending programme in the build-to-rent sector and plans to launch a mortgage product for prime first-time buyers in the coming months.

Gary McKenzie-Smith, Managing Partner at ARA Venn, commented: “One of the main goals we set for Cartesian 5 was to build a more diverse investor base that would help to support liquidity in secondary markets. We are delighted to have achieved that as it will help the wider Cartesian programme as well as our execution on this deal. We look forward to the continued growth of this important investment strategy, and to taking our experience and track record into other residential mortgage markets.”

Marc de Moor, CEO of Venn Hypotheken, commented: “We are thrilled with the outcome of this issuance. Not only does this underline the robustness of our platform both in terms of asset quality and funding diversification but also illustrates the execution power of the ARA Venn team and JLMs even in these troubled economic times.”

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