FINANCE: Westfield has delayed its proposed 750m Stratford City CMBS due to regulatory uncertainty. Advising banks, Deutsche Bank and Credit Agricole CIB, today pulled the single tranche securitisation while a clarification is sought over whether sponsor Westfield needs to retain a 5% stake in the structure. Under the European Commissions Capital Requirements Directive the sponsor in agency CMBS deals tend to hold a 5% stake, while in true sale securitisations the arranging banks retain 5%. The so-called skin-in-the-game requirement is aimed at regulating arranging banks and aligning their interests with investors. Westfield had decided not to retain the 5% holding as the agency CMBS is only a single tranche transaction not multiple tranche and therefore is not technically defined as a CMBS under CRD requirements. However some bond investors have funds or compliance regulations requiring a 5% retention by the sponsor. The deal has now been delayed while both investors and Westfield clarify their positions. It could be re-launched in the autumn. Yesterday official pricing confirmed expectations that the CMBS is the lowest priced post-crisis securitisation with the AAA-rated notes priced at between 87-90bps over three-month LIBOR. The issue refinances an existing 550m senior loan secured against the 1.9m sq ft east London shopping centre, which is valued at 1.9bn. Bridget.oconnell@estatesgazette.com
FINANCE: Westfield has delayed its proposed 750m Stratford City CMBS due to regulatory uncertainty.
Advising banks, Deutsche Bank and Credit Agricole CIB, today pulled the single tranche securitisation while a clarification is sought over whether sponsor Westfield needs to retain a 5% stake in the structure.
Under the European Commissions Capital Requirements Directive the sponsor in agency CMBS deals tend to hold a 5% stake, while in true sale securitisations the arranging banks retain 5%.
The so-called skin-in-the-game requirement is aimed at regulating arranging banks and aligning their interests with investors.
Westfield had decided not to retain the 5% holding as the agency CMBS is only a single tranche transaction not multiple tranche and therefore is not technically defined as a CMBS under CRD requirements.
However some bond investors have funds or compliance regulations requiring a 5% retention by the sponsor.
The deal has now been delayed while both investors and Westfield clarify their positions. It could be re-launched in the autumn.
Yesterday official pricing confirmed expectations that the CMBS is the lowest priced post-crisis securitisation with the AAA-rated notes priced at between 87-90bps over three-month LIBOR.
The issue refinances an existing 550m senior loan secured against the 1.9m sq ft east London shopping centre, which is valued at 1.9bn.
Bridget.oconnell@estatesgazette.com
