Market Chatter: BBVA Plans 3 Billion Euro Mortgage Risk Transfer Deal

MT Newswires Live03-30

Banco Bilbao Vizcaya Argentaria (BBVA) is working on a significant risk transfer tied to about 3 billion euros ($3.5 billion) of high loan-to-value mortgages, Bloomberg reported Monday, citing unnamed sources familiar with the matter.

The transaction would cover loans where borrowers typically finance 85%-95% of property value, increasing lender exposure if home prices fall, according to the report.

The risk transfer transaction is equivalent to over 10% of the reference portfolio and will be in part placed through unfunded credit protection, where insurers don't provide cash up front but compensate the bank only if losses occur.

BBVA did not immediately respond to MT Newswires' request for comment.

(Market Chatter news is derived from conversations with market professionals globally. This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed.)

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