Norton Rose Fulbright advises BofA Merrill Lynch on residential mortgage-backed securities program

Global law firm Norton Rose Fulbright advised BofA Merrill Lynch on its role as lead placement agent for the structuring and launch of an innovative residential mortgage-backed securities (RMBS) program for Home Trust Company.

Home Trust’s program is issued through the Classic RMBS Trust. Home Trust, a principal subsidiary of Canadian holding company Home Capital Group Inc., provides customers with a range of credit products, including mortgages, credit cards and deposit services.

The Classic RMBS Trust issued C$425m of notes, which were privately placed with investors in Canada and the U.S. by a syndicate led by BofA Securities and co-managed by BMO Capital Markets and RBC Capital Markets. Another C$75m of the series 2019-1 notes comprising B and Z tranches were taken by Home Trust Company. The A tranche was rated AAA(sf) by global credit rating agency DBRS and Aaa(sf) by Moody’s.

The Classic RMBS Trust program is the first-ever private RMBS program in the Canadian market designed to offer notes to investors in both Canada and the U.S. It is Home Trust Company’s first offering of residential mortgage-backed securities, and one of only a few such private (non-federal government housing agency) RMBS programs in Canada. 

Toronto-based partner Elana Hahn, who led Norton Rose Fulbright’s cross-border team, commented:  

“The Classic RMBS Trust program, with the support of other industry participants, should help to establish a robust and liquid private RMBS market in Canada.”

The Norton Rose Fulbright team also included Abigail Court, Denise Gan, Matthew Lau (Toronto), Michèle Friel (Montreal), Eric Reither, Barry Segal, Troy Ungerman, Tommy Wong, (Toronto), Patrick Dolan, Bill Cavanagh, and Leslie Teng (New York).