Banco Santander will launch its first conduit a unique multi-seller, “multi-task” vehicle with a wide range of assets.
The conduit is authorized to issue $2 billion and will be set up by Jim McDonald, who recently left his position as an asset-backed commercial paper analyst at Moody’s Investors Service, after four years to arrange this vehicle.
It will be a typical multi-seller program that will support bank customers doing a wide variety of assets including trade receivables and other typical collateral found in a multi-seller conduit.
“It’s going to be different in the sense that we will also have the ability to do a securities arbitrage in the program as well as match-funded loans,” McDonald said. “Instead of having a separate securities arbitrage conduit or a loan-reciprocal program – we are going to do all three in the same program.”
Initially the conduit will be primarily be scoping out banks in the U.S. as sellers, however it will also be looking overseas.
According to McDonald, this type of conduit is not yet common, though hybrid programs seem to be a growing trend.
While Banco Santander has not had its own conduit, it is not a stranger to this product. The bank provides liquidity for other conduits and for specific transactions.
Banco Santander is a financial services organization based in Madrid, Spain. It has operations in at least 32 countries with nearly 5,000 branch offices. In addition to its strong presence in the U.S. and Puerto Rico, it is also very active in Argentina, Brazil, Colombia, Chile, Mexico, Peru, Uruguay, and Venezuela.