Friary No 4 Plc: 03 June 2017

This will be the fourth stand-alone residential owner-occupied pass-through RMBS transaction from The Principality Building Society, with the portfolio consisting of prime residential owner-occupied mortgages originated in the UK. The Principality Building Society is the sixth largest building society (ranked by total assets) in the United Kingdom, with total assets as at 31 December 2016 of £8.3bln and a network of 53 branches and 18 agency offices.

Eligibility criteria for inclusion (includes): all Loans were made no earlier than 31 December 2000 and on or before 31 December 2016; each Loan was originated by the Seller in the ordinary course of business and was denominated in pounds Sterling; at least one monthly payment due in respect of each Loan has been paid by the relevant Borrower as at the Cut-Off Date; no Loan is a staff loan; each Loan has been designated as a prime Loan under the Seller's Lending Criteria; no Loan is more than one monthly payment in arrears; to the best of the Seller's knowledge, no Borrower had ever filed for bankruptcy, entered into an individual voluntary arrangement or had a county court judgment entered against him on or prior to the date on which the Borrower executed the relevant Mortgage.

At the cut-off date (30 April 2017) the portfolio consisted of 5,676 accounts (6,285 sub-accounts) with an average current borrower balance of £101,289 and a maximum loan size of £598,844. Repayment type (by total balances): repayment 87.16%, interest only 11.34% and part/part 1.50%. Interest rate product: fixed rate to SVR 89.09%, discounted SVR 7.36% and SVR for life 3.55%. The WA current LTV is 58.99% (original LTV was 63.12%) and the WA seasoning is 23.52mnths. Regional concentration (by current balances): Wales 23.41%, South West 12.37%, West Midlands 12.28%, North West 12.05% and South East 10.26%.

Significant Investor: Principality will, on the closing date, purchase all of the Class B Notes.


CRR/405: Principality will undertake that it will retain a material net economic interest of at least 5% in accordance with each of Article 405 of Regulation (EU) No.575/2013 and Article 51 of Regulation (EU) No. 231/2013, referred to as the Alternative Investment Fund Managers Regulation. As at the Closing Date, such interest will be comprised of an interest in the first loss tranche, in this case the Class B Notes, as required by Article 405 of the CRR and Article 51 of the AIFMR.

The Seller, as the sponsor under the U.S. Risk Retention Rules, does not intend to retain at least 5% of the credit risk of the securitised assets for purposes of compliance with the final rules promulgated under Section 15G of the Securities Exchange Act of 1934, but rather intends to rely on an exemption provided for in Section __.20 of the U.S. Risk Retention Rules regarding non U.S. transactions.


Compare/contrast: Friary 3, Brass RMBS No 5 plc, Ripon Mortgages Plc