Amresco Cites Record Pricing on $1B Deal

Amresco Residential Mortgage Banking Group, Dallas, has announced record pricing for a $1 billion home equity deal.Amresco Residential Securities Corp. Mortgage Loan Trust 1998-2 consisted of nine classes of fixed-rate certificates totaling $350 million and five classes of adjustable-rate certificates totaling $650 million. The triple-A rated floaters priced at 4 basis points above the London Interbank Offered Rate for the shorter bond and a record LIBOR plus 15.5 bp for the longer bond, Amresco said. The blended average spread was less than 13 bp above LIBOR. Scott J. Reading, president of Amresco Residential Mortgage, said the execution "shows investors have begun to differentiate between home equity issuers." Greg Richter, head of asset-backed security trading for Prudential Securities, the lead underwriter for the issue, said the spreads on the floating-rate tranches "were perhaps the tightest to date and the fixed rate was the tightest in quite some time." Mr. Richter said the Amresco name attracted diverse investors and cited the level of oversubscription on many tranches as evidence of investor confidence.