Alantra advises Banco Montepio on the first Portuguese residential mortgages synthetic securitization


ServiceFunding and Structured Finance

Nov 2022

Portugal – Alantra has acted as sole advisor for Banco Montepio (“the Bank”), a Portuguese landmark bank, on its first funded synthetic securitization on a residential mortgage portfolio.

Established in 1844, Banco Montepio is the oldest financial institution in Portugal. It has purchased credit protection for the Mezzanine tranche through a financial guarantee from a portfolio of €880m residential mortgages. The Bank retains 100% of the Senior & Junior Tranches. The transaction structure includes 1bps of excess spread in use-it-or-lose-it format.

The economic rationale for the deal was to release total RWAs and increase the Bank’s CET1 ratio, the transaction is STS compliant.

One investor has been selected following a competitive process involving over 20 potential institutional investors. The Noteholders have taken 100% participation of the Notes, which are listed on TISE.

Alantra’s Portuguese and SFABS teams supported the client throughout the duration of the deal, from data remediation to closing.

Paulo Gray, Senior Advisor at Alantra, said: “We are pleased to have assisted Montepio in this strategic transaction.”

“Although market conditions were challenging, we managed to source sufficient interest in this first ever Portuguese synthetic transaction backed by residential mortgages,” added Gonzalo Ferri, Senior Vice President at Alantra.

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