Sanlam Home Loans securitises its second R1 billion

Sanlam Home Loans (SHL), through Absa Corporate & Merchant Bank successfully placed the second R1 billion of a R5 billion mortgage-backed programme in the capital markets. The issue was three times oversubscribed and was taken up by various investors.

Piet Van der Walt, chief executive of SHL confirms that such securitisation forms an integral part of SHLs overall funding strategy.

Since its inception in 2005, SHL has built up a home-loans book of close to R3 billion through its vast distribution network. Currently, the company grants home loans to the value of more than R300 million a month.

As SHL relies on Sanlams distribution network of financial intermediaries, it does not require an expensive infrastructure to market home loans. The client benefits, as securitisation facilitates the entry of new lenders such as SHL to the local housing market, which increases competition and offers the consumer a wider choice, says Van der Walt.

Even though SHL primarily focused on taking over existing home loans, it also finances new home loans. SHL targets the middle market and is integrated in Sanlam Topazs tailor-made portfolio of solutions.

Fitch Ratings, the international credit-rating agency recently affirmed the rating of senior bonds as outstanding notes. This is proof of the quality of loans granted by SHL, says Van der Walt

Finally, Van der Walt cautions that homeowners and prospective property buyers should always ensure that their investments are aligned with their future financial needs. According to him the sale of a home loan by a financial intermediary benefits clients because their financial circumstances are holistically evaluated.