Mulcair Securities DAC Irish RMBS Notes Assigned Ratings


  • One or more of the credit ratings was assigned by deviating from S&P Global Ratings' published criteria.
  • Mulcair Securities DAC's issuance is an RMBS transaction backed by first-lien Irish buy-to-let mortgages.
  • We assigned our ratings to the class A, B-Dfrd, C-Dfrd, D-Dfrd, and E-Dfrd notes.
  • The ratings reflect our view of the transaction's payment structure, cash flow mechanics, and the results of our cash flow analysis, among other factors.
DUBLIN (S&P Global Ratings) April 18, 2019--S&P Global Ratings has assigned 
its credit ratings to Mulcair Securities DAC's (Mulcair's) class A, B-Dfrd, 
C-Dfrd, D-Dfrd, and E-Dfrd notes. At closing, Mulcair will also issue unrated 
class Z notes (see list).

Our ratings address the timely payment of interest and the ultimate payment of 
principal on the class A notes. Our ratings on the class B-Dfrd, C-Dfrd, 
D-Dfrd, and E-Dfrd notes address the ultimate payment of interest and 
principal on these notes. Our ratings do not address the payment of additional 
note payments on the class C-Dfrd, D-Dfrd, and E-Dfrd notes.

Mulcair is a securitization of a pool of first-ranking residential mortgage 
loans, secured on properties in Ireland originated by The Governor and Co. of 
the Bank of Ireland (Bank of Ireland), ICS Building Society, and Bank of 
Ireland Mortgage Bank. Bank of Ireland will act as servicer for all of the 
loans in the transaction from the closing date.

Although the loans in the pool were originated as prime mortgages, arrears in 
the portfolio peaked at approximately 44% in 2014, mainly due to the stressed 
macroeconomic environment in Ireland. Since then, arrears have been on a 
decreasing trend, in line with the overall mortgage market trends in Ireland 
due to a combination of improvements in the economic environment and 
restructuring arrangements implemented by the servicer.

Given that this pool comprises only buy-to-let mortgages, we have applied an 
exception from the foreclosure timing assumption of 42 months in our Irish 
residential mortgage-backed securities (RMBS) criteria. Buy-to-let mortgages 
are typically not subject to the same Code of Conduct on Mortgage Arrears 
regulations as owner-occupied mortgages, and given that the underlying loan 
contracts permit the direct appointment of a receiver, we assume that the 
issuer regains any recoveries 24 months after a payment default in our 
analysis.

Our ratings reflect our assessment of the transaction's payment structure, 
cash flow mechanics, and the results of our cash flow analysis to assess 
whether the notes would be repaid under stress test scenarios. The 
transaction's structure relies on a combination of subordination, excess 
spread, a senior reserve fund, and a general reserve fund to cover credit 
losses and income shortfalls. Having taken these factors into account, we 
consider the credit enhancement available to the rated notes to be 
commensurate with the ratings that we have assigned.
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