ItalFinance Securitisation Vehicle 2 2007-1

This will be the 14th leasing transaction originated by Gruppo Banca Italease. It is the leader
in the Italian leasing market, with a market share of 17.8% (Sept 2006). It operates predomin-
antly in the financial leasing businesses for real estate, equipment and naval. With a year-on
-year growth of 15% compared to a market growth of 4%, Banca Italease grows faster than
the leasing market thanks in particular to the naval, auto and real estate segments. Banca
Italease mainly provides domestic leasing services to small and medium-sized Italian companies
with fewer than 100 employees.

The underlaying collateral pool consists of 14,625 Italian performing auto, equipment and real
estate lease contracts to 11,824 obligors. 73% of the collateral portfolio has been originated by
Banca Italease and approximately 27% by Mercantile Leasing. Since July 2004, Mercantile Leas-
ing has been 100% owned by Banca Italease. Average seasoning is 1 1/3yrs, with a current
average LTV of 68.4%. Geographically, the portfolio is split: 57.2% North, 26.1% Centre and
16.7% South.

Approximately 59.5% of the portfolio is made up of real estate assets, 29% represent equipment
and 11.5% auto. The average size of lease by debtor is Eur143,426, with the top 10 debtors
esponsible for 4.33% of the total pool. The top 20 debtors account for 8.30% of the pool.

Good investor interest resulted in aggressive pricing, which either matched the lows of or beat
the original 13a/lo 30s/55-60/75-80 guidance. Taking the last Leasimpresa deal as a comparator,
(launched Oct06), the Leas-impresa securitisation however, was more granular and had a much
stronger focus on Northern Italy, reflected in lower AAA credit enhancement of 9.2%. Neverthe-
less the current deal manages to hold its own at the top of the capital structure pricing 1bp inside
the smaller Eur931.5m Leasimpresa equivalent. However at the mezzanine level pricing was 2bps
wider. The top tranche was 2.7x subscribed at the original 13a guidance and 1.73x covered at its
revised 12a guidance. The mezz and junior notes were as much as 6x over subscribed. The main
buyers came from France (35%), Germany (25%), the UK and Ireland (20%).


Compare/contrast: AgriSecurities 2006-1, Leasimpresa Finance Srl 2006, Locat Securitisation
Vehicle 4 S.r.l,