WestLB has successfully structured and placed the ABS transaction of BMW Group Financial Services
As Sole Arranger, Sole Bookrunner and Joint Lead Manager, WestLB Asset Securitisation has successfully closed the first public true-sale securitisation of BMW Group in Europe. In addition, WestLB provides the swap to hedge the interest rate risk between the floating rate notes and the underlying fixed rate lease contracts.
The transaction was placed in the capital market in two tranches:
- EUR 752 million Class A notes rated AAA/Aaa/AAA (Fitch/Moody’s/S&P)
- EUR 48 million Class B notes rated A/A1/A (Fitch/Moody’s/S&P).
In a market environment with huge competing supply, the transaction was marketed to institutional investors throughout Europe; the low spreads of 1-month Euribor +0.08% (Class A) and +0.18% (Class B) reflect investors' strong interest and the high quality of the portfolio. The broadly diversified portfolio consists of approximately 77,000 lease contracts with private and commercial lessees in Germany. During a 2 year revolving period, BMW Leasing GmbH has the right to sell additional lease receivables to Bavarian Sky S.A. Compartment 1 on a monthly basis, thereafter the notes will be repaid from portfolio proceeds.
The issuing SPV (Bavarian Sky S.A.) has been established under new Luxembourg securitisation law and does not only form the basis for this first transaction; by establishing new Compartments, BMW Group Financial Services can also use the platform for further securitisation transactions in Europe.
BMW Leasing GmbH, a subsidiary of BMW AG and, together with BMW Bank GmbH, a key element of BMW Group Financial Services, was established over 30 years ago and has been one of the key members of the BMW Group ever since. Besides auto finance, the company’s main fields of activity include insurance services and investment products.