It’s been “some time” since the recent origination PL RMBS market has seen two deals in one month, Fitch managing director Roelof Slump noted, but the closeness between the two deals is due to the fact that much work on the 2013-1 transaction had been performed in December in advance of the January closing.
Slump told this publication that the relatively large $600-million-plus deal utilizes the “I” structure Sequoia typically employs. More than half of it is backed by jumbo loans originated by First Republic Bank, Sequoia’s original main post-downturn originator.
FRB has a strong track record as an originator, but also San Francisco/California concentrations that the issuer had sought to diversify away from.
However, due to other positive features in the transaction such as particularly high reserves and more conservative combined loan-to-value ratios, the deal’s credit enhancement levels remained in line with those of other Sequoia securitizations, Slump said.