Mosaic's USD-308m solar loan securitisation gets "overwhelming" demand

US solar loan provider Mosaic Inc said today it has completed a USD-307.5-million (EUR 264.2m) securitisation of residential solar loans, the largest such securitisation so far.

The MSAIC 2017-2 deal attracted "overwhelming" investor interest. There were more than USD 1.7 billion in investor orders and the offering was ultimately placed with 29 institutional investors from the US and Europe.

Mosaic says solar loans are a growing asset class as consumers increasingly prefer to own rather than lease residential solar systems. With more than USD 1.3 billion in solar loans funded since its creation, the company expects to continue tapping the securitisation market.

The just-completed deal is Mosaic's second term securitisation. It saw USD 307.5 million of notes sold across four tranches with ratings from A to BB+. The tranches all priced inside the initial guidance levels, achieving an all-in yield of 4.2%, the company said. The bonds are modelled to a weighted average life of about 4.1 years. They are backed by an initial collateral pool of USD 275 million of loans, while another USD 75 million of loans may be acquired during a three-month supplemental purchase period.

The deal has been designated a green bond based on the standards published by the International Capital Markets Association.

GTM Research recently said that solar securitisations would breach USD 1 billion this year, a record level, following completion of this Mosaic transaction.

(USD 1 = EUR 0.859)

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