Linklaters and Allen & Overy have led on the milestone £6.1bn securitisation of a packet of over 80,000 pre-crisis UK mortgages. The loans were made by the mortgage arm of failed UK bank Northern Rock before it was nationalised in 2008, and when purchased by Cerberus for £13bn in November last year represented the biggest asset disposal ever undertaken by the UK government.

Roles

Linklaters partners led advice to two Cerberus subsidiaries, Cerberus European Residential Holdings and FirstKey Mortgage, which packaged the bonds. Meanwhile, a team from Allen & Overy advised Morgan Stanley as arranger and joint lead manager of the securitisation. Both firms called on partners from New York as well as London to lead their advice.

RMBS comeback

The deal, which has been mostly pre-placed with institutional investors, is being cautiously heralded as a return to confidence for the controversial asset class, misuse of which led to the global financial crisis of 2007. Allen & Overy securitisation partner Sally Onions, a lead adviser on the deal, commented: 'The message this transaction sends is really important, not just because of its sheer size, but rather how it underlines the growing confidence in the asset-backed securities market. Market participants will be reassured by its success and we expect to see other non-bank entrants come to the securitisation markey over the course of the year.'

Sources: Legal Business; Financial Times