Firstrand Limited · JSE:FSR
Firstrand — Aldermore Bank — Debt Investor Presentation (August 2019)
36 slides from Firstrand's debt investor presentation, August 2019
Slide 1: Aldermore Bank PLC Oak No.3 PLC RMBS Investor Presentation
Aldermore Bank PLC Oak No.3 PLC RMBS Investor Presentation August 2019 Strictly Private & Confidential
Slide 2: Contents
Contents 1. Oak No.3 PLC – Transaction Overview p. 3 2. Aldermore Bank Overview p. 5 3. Origination and Underwriting p. 8 4. Servicing and Collections p. 16 5. Transaction Structure p. 19 6. Oak 3 Portfolio and Historical Performance p. 26 Appendices & Disclaimer A Aldermore History p. 32 B First Ra
Slide 3: Section 1: Oak No.3 PLC - Transaction Overview
Section 1: Oak No.3 PLC - Transaction Overview
Slide 4: Transaction Overview
Transaction Overview Spread Credit Principal WAL to WAL to Expected Rating Benchmark over Step-Up and Legal Final Class Enhancement Amount Call2 Maturity Status (Moody’s / Fitch) Index Benchmark Call Date Maturity Date (%)1 (£mm) (years) (years) Index A Aaa(sf) / AAA(sf) 10.00 [●] 2.77 3.33 SONIA [
Slide 5: Section 2: Aldermore Bank Overview
Section 2: Aldermore Bank Overview
Slide 6: Ten Years of Banking as it Should be
Ten Years of Banking as it Should be • A UK bank providing award-winning lending and deposit products to its customers to help them seek and seize opportunities in their professional and personal lives • Customers include Small and Medium-sized Enterprises (SMEs), homeowners, landlords and savers, w
Slide 7: Supported by Diversified Funding Platform
Supported by Diversified Funding Platform Deposit Funding • Predominantly deposit led funding model, complemented by wholesale Funding Sources1 • Award winning savings franchise across Retail & SME 22% • Growing Corporate Deposit book 7% £10.2bn 51% Wholesale Funding • Two Prime RMBS have been issue
Slide 8: Section 3: Origination and Underwriting
Section 3: Origination and Underwriting
Slide 9: Mortgage Strategy Overview
Mortgage Strategy Overview Since launching in 2009, Aldermore has established a presence in both the owner occupied and BTL sectors with attractive product offerings, supported by: • A prudent and skilled underwriting approach with flexible and scalable technology • An in-house approach enabling bet
Slide 10: Route to Market
Route to Market Distribution Routes • Strong distribution network established with Mortgage Clubs, Networks and Directly Authorised Firms. Conduit to market as this reduces the requirement for a large field sales team, complemented by a direct to market offering • Aldermore has over 10,557 active FC
Slide 11: Lending Criteria – Loan
Lending Criteria – Loan Loan Criteria Mortgage Indemnity Guarantee • Lending criteria approved via Credit Committee (CC) Residential mortgage loans with an LTV between 80.01% (excluding fees) and 95% LTV will have a Mortgage Indemnity • Policy lays down the parameters within which any Guarantee (MIG
Slide 12: Lending Criteria – Applicant
Lending Criteria – Applicant Applicant Criteria Affordability • Criteria includes Income, Affordability and the below The rates used within the affordability calculation are tiered by attributes: LTV bandings as follows with a 3% stress: Applicant Criteria Owner-Occupied Oak Criteria Term Variable F
Slide 13: Lending Criteria – Income & Property
Lending Criteria – Income & Property Income Property • No self-certified income • The property which a loan is secured against is used as protection of our interest as a lender, rather than as an • Evidence of income required for all mortgage alternative method of repaying the debt for the borrower
Slide 14: Robust Underwriting Processes
Robust Underwriting Processes 1 Clear products, credit policies and procedures • Clearly defined credit criteria and product terms • Underwriting processes designed to ensure Robust underwriting approach 2 consistency of approach and decision • Traditional approach to assessing creditworthiness • St
Slide 15: Strong Quality Control
Strong Quality Control Monitoring & Management Summary of Monitoring Process • Underwriters are closely managed and monitored Area Description Quantity Frequency through a variety of sources and business areas 5% per Full Offer Review • Decision quality, adherence to policy, regulation, and person p
Slide 16: Section 4: Servicing and Collections
Section 4: Servicing and Collections
Slide 17: Servicing and Collections
Servicing and Collections Servicing & Collection Overview Single collections strategy • Operate a shared Servicing and Collections platform Stage Days which allows consistent standards for each boarded loan Start of Collections Process 1 • Customer Service Advisers manage all activity post the compl
Slide 18: Forbearance & Collections Performance
Forbearance & Collections Performance Forbearance OO Case Volumes • Careful consideration is given to the individual B. < 1 C. >=1, < 2 D. >=2, < 3 E. >=3, < 4 customer’s financial circumstances in order to arrive at F. >=4, < 5 G. >=5, < 6 H. >=6 a suitable action plan to rehabilitate the loan with
Slide 19: Section 5: Transaction Structure
Section 5: Transaction Structure
Slide 20: Provisional Portfolio Characteristics
Provisional Portfolio Characteristics Portfolio Eligibility Criteria Provisional Portfolio Overview All Loans Aldermore Tier I Aggregate Loan Balance (GBP) 386,198,070 No CCJ or Bankruptcy History Number of Loans 2,708 No Self Certified Income Average Loan Balance (GBP) 142,614 No BTL WA Ori
Slide 21: Transaction Structure
Transaction Structure Principal and Interest Sale of Mortgage Class A Noteholders Portfolio Aldermore Oak No.3 PLC (Originator, Cash Manager, (Issuer) Note Proceeds Servicer) Consideration Class Z VFN Holder Aldermore Citibank N.A., London Maples Fiduciary Branch Citicorp Trustee Barclays Bank Servi
Slide 22: Possible Weighted Average Lives
Possible Weighted Average Lives Possible WALs of Class A Notes (unaudited) Assumptions CPR Assuming Issuer call on Assuming no Issuer call • The Issuer exercises its option to redeem the Class A on the Step-Up Date Step-Up Date, in the first scenario, or the Issuer does not 0% 4.56 years 9.83 years
Slide 23: Priority of Payments
Priority of Payments Summarised Pre-Acceleration Priority of Payments Post-Acceleration Priority of Payments Revenue Principal (a). Amounts due to the Note Trustee and Security Trustee (a). Amounts due to the Note Trustee and Security Trustee (a). Class A Principal (b). Amounts due to the Agent Bank
Slide 24: Deal Comparison
Deal Comparison Elvet RMBS Oak 3 Oak 2 Bowbell 2 Brass 7 Gosforth 2018-1 CMF 18-1 Brass 6 2018-1 Originator Aldermore Aldermore Bank of Ireland Atom Bank Yorkshire BS Virgin Money CCFS Yorkshire BS Structure Standalone Standalone Standalone Standalone Standalone Standalone Standalone Standalone Clos
Slide 25: STS Requirements
Simple, Transparent, Standardised (STS) • Oak No. 3 is structured to comply with the Simple, Transparent and Standardised (STS) criteria for securitisations • A draft of the STS notification, historical performance data and draft Transaction Documents will be available STS on https://editor.eurodw.e
Slide 26: Section 6: Oak 3 Portfolio and Historical Performance
Section 6: Oak 3 Portfolio and Historical Performance
Slide 27: Provisional Portfolio Characteristics
Provisional Portfolio Characteristics Current Balances OLTV 40% 40% % of Current Balance % of Current Balance % of Loans % of Loans 30% 30% Average: £142,614 WA: 72.2% 20% 20% 10% 10% 0% 0% CLTV Indexed CLTV 40% % of Current Balance 40% % of Current Balance % of Loans % of Loans 30% WA: 70.0% 30% WA
Slide 28: Provisional Portfolio Characteristics
Provisional Portfolio Characteristics Seasoning (months) Remaining Term (years) 70% 40% % of Current Balance % of Current Balance 60% % of Loans % of Loans 50% 30% WA: 13.8 WA: 23.8 40% 20% 30% 20% 10% 10% 0% 0% Geographic Region Repayment Method 3.6% South East West Midlands 10.3% 9.3% 17.9% South
Slide 29: Provisional Portfolio Characteristics
Provisional Portfolio Characteristics Purpose of Loan Interest Rate Type 4.1% Fixed rate loan to floating 44.6% Purchase Floating rate loan 55.4% Re-mortgage 95.9% Current Interest Rates Fixed Rate Loans Reversion Date 60% 60% % of Current Balance % of Current Balance 50% 50% % of Loans % of Loans 4
Slide 30: Oak Historical Performance vs. Peers
Oak Historical Performance vs. Peers 30 day delinquency by Seasoning 90+ day deliquency vs Moody’s UK Prime 0.40% RMBS 2.00% 0.30% 1.50% 0.20% 1.00% 0.10% 0.50% 0.00% 0.00% 2 3 4 5 6 7 8 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Oak No.2 Oak No.1 Elvet 2018-1 Oak No.2 Oak No.1 Brass No.7 Gosforth 2018-1 CM
Slide 31: Appendices & Disclaimer
Appendices & Disclaimer
Slide 32: Appendix A: Our History
Appendix A: Our History Helping our customers to seek and seize opportunities since 2009 Source: Aldermore 32
Slide 33: Appendix B: FirstRand Group Structure
Appendix B: FirstRand Group Structure OTHER WHOLLY-OWNED LISTED HOLDING COMPANY (FIRSTRAND LIMITED, JSE: FSR) SUBSIDIARIES OF FIRSTRAND LTD FirstRand Bank Limited 100% SA banking FirstRand International Limited (Guernsey) FirstRand EMA UK banking (Pty) Ltd (FREMA) Banking subsidiaries 100% in the re
Slide 34: Appendix C: UK Mortgage Market
Appendix C: UK Mortgage Market Market Overview Self Employed Market £1,451bn £268 bn £37.1bn Size of the UK housing Total mortgage lending Gross buy-to-let lending 4.8 million 15.1% in 2018, up 3.6% on The number of self- Percentage of total market. As large as the in 2018, up 3% on 2017 2017 but do
Slide 35: Disclaimer Important notice
Disclaimer Important notice By accessing, viewing or reading this Communication you confirm, represent, warrant and undertake that you understand, acknowledge and agree to comply with the contents of this disclaimer. REGULATION S BEARER-FORM SELLING RESTRICTIONS: NOT FOR DISTRIBUTION TO ANY US PERSO
Slide 36: Disclaimer Important notice
Disclaimer Important notice This document contains certain tables and other statistical analyses (the Statistical Information) which have been prepared in reliance on information provided by the Seller. Numerous assumptions have been used in preparing the Statistical Information, which may or may no
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