Southern Pacific Securities 06-1 plc

The fifteenth public issue off the Southern Pacific conduit (Finance & Securities), and the
first non-conforming RMBS transaction of the year, the deal following the structure of the last
non-con deal brought by Lehman, the SPS 2005-3.
(all docs for previous issues also available on EuroABS)

In the underlaying portfolio, past/present CCJs are against 46.7% of the borrowers, and 68.8%
are self-certified, with 20% of the pool consisting of second ranking loans. Some 11.75% of
the loans are discounted (usually for the first year).A point of potential concern is also
that 60% of the pool has been originated by (commision based ?)intermediaries who's interests
may be decidedly different to the lender. At close, the LTV is 72.54%.

However, nothing seems to dampen investor demand, with all tranches well subscribed, with good
demand seen from the UK and continental Europe as well as Asia and the US. Pricing was achieved
at guidance levels, with the 4.27yr AAA piece pricing around 9bps over prime UK RMBS, matching
SPS 2005-3's equivalent




Compare/contrast: SPS 2005-3