Scotiabank plans SRT transaction tied to US$2 billion of loans

Skip to Content News Archives Economy Defence Energy Oil & Gas Renewables Electric Vehicles Mining Commodities Agriculture Real Estate Mortgages Mortgage Rates Finance Banking Insurance Fintech Cryptocurrency Defence Work Wealth Smart Money Wealth Management Investor Personal Finance Family Finance Retirement Taxes High Net Worth FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials More Innovation Information Technology FP500 Podcasts Small Business Lives Told Tails Told Shopping Financial Post Store Obituaries Place a Notice Advertising Advertising With Us Advertising Solutions Postmedia Ad Manager Sponsorship Requests Classifieds Place a Classifieds ad Working Profile Settings My Subscriptions My Offers Newsletters Customer Service FAQ News Economy Energy Mining Real Estate Finance Defence Work Wealth Investor FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials This advertisement has not loaded yet, but your article continues below.HomeBankingNewsScotiabank plans SRT transaction tied to US$2 billion of loansCanadian banks are regular issuers of significant risk transfer loansAuthor of the article:Esteban Duarte and Paula SamboScotiabank’s deal would cover a first loss piece of the reference portfolio. Photo by Cole Burston/BloombergBank of Nova Scotia is working on a significant risk transfer tied to around US$2 billion of loans, joining a growing list of lenders looking to take advantage of strong demand to wrap up deals before year-end.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountThe potential transaction would hedge a portfolio of large corporate loans, according to people familiar with the matter. Terms of the deal may change during discussions with investors, they said, asking not to be identified because the talks are private.This advertisement has not loaded yet, but your article continues below.SRTs are high-risk, high-yield investments that typically insure a first loss or junior portion of a portfolio in exchange for coupons that regularly exceed 10 per cent. Issuance has boomed in recent years, enabling mainly European and North American lenders to offload risk tied to US$1 trillion in loans to investors, releasing regulatory capital for new lending, shareholder payouts or acquisitions.Breaking business news, incisive views, must-reads and market signals. Weekdays by 9 a.m.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Posthaste will soon be in your inbox.We encountered an issue signing you up. Please try againOther lenders discussing transactions that could be completed this year include BNP Paribas SA, Societe Generale SA, Banco Santander SA and Intesa SanPaolo SpA.Scotiabank’s deal would cover a first loss piece of the reference portfolio, the people said. Representatives for Scotiabank didn’t respond to multiple requests for comment.Canadian banks are regular issuers of SRTs. Earlier this year, Bank of Montreal completed two deals covering about US$5 billion of corporate loans.We apologize, but this video has failed to load.This advertisement has not loaded yet.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.