Four veterans of the sub-prime U.K. mortgage market have set up a new London-area lender, Money Partners, as a joint venture with Kensington Mortgages, an established originator and issuer of residential mortgage-backed securities. All of the collateral originated by MP will go on KM's balance sheet and could wind its way to the European structured finance market.
Simon Kingdon, finance director at KM, joined Money Partners in October, while Colin Sanders, ceo, and Peter Brennan, chief operating officer, joined the startup a few months prior from Watford-based sub-prime lender igroup. The three are all executive directors at MP and are joined by David Johnson, non-executive chairman. He was managing director of igroup until 2001 and remains ceo of Commercial First, another mortgage originator.
The new firm originates second-charge as well as the first-charge mortgages which are KM's traditional business, broadening the pool of collateral it can include in its mortgage-backed bonds. It is not yet clear whether these new mortgages will be combined with collateral originated by KM in future deals or will be kept separate.
KM has issued 21 mortgage-backed securities to date, the latest of which was the 19th in its RMS series, which securitizes first-charge mortgages originated by KM.