make financial use of their asset. As Merrill Lynch's management did not feel that the product would fit into their existing product portfolio, Craig Corn approached other companies, and moved to the Swiss Bank Corporation (SBC). David Garner had joined SBC from a building society in Autumn 1995, and had knowledge of the UK mortgage and capital markets. Corn and Garner worked together on the project and obtained legal opinion. It soon emerged that homeowners could give up a share in the appreciation of their property in return for a fixed-term, low-interest mortgage, while investors could access the shared appreciation in return for their investment. (SBC bought S. G. Warburg & Co., a leading British investment banking firm, in 1995, and merged it with its own investment banking unit to create SBC Warburg.) As well as having the support of SBC as an investment bank, Corn and Garner also needed a mortgage lender to market and manage the mortgages. Of the building societies and banks they approached, Bank of Scotland had a good reputation and were considered to be innovative. In February 1996, Craig Corn contacted Willie Donald, who had recently joined Bank of Scotland as Director of Sales. Willie Donald liked the idea and took it via George While, Head of Mortgages, to George Mitchell, Divisional Chief Executive of Personal Banking, both of whom also liked the idea. Mitchell put the idea to the main board, who approved it in principle in June 1996. Getting started SBC and Bank of Scotland quickly reached agreement to cooperate. George Mitchell selected Neil Forrest to work with Willie Donald on the product. Neil Forrest had been with the bank for seven or eight years and had expertise in securitization; Willie Donald had just introduced the Personal Choice Mortgage. According to Neil Forrest, Craig Corn and Willie Donald had the ideas while he and David Garner translated the ideas into something realizable. The team spent four or five months working on the first version of the product, which did not involve securitization. This is the pooling of debt such as residential mortgages, and selling their cash flows as securities, also known as bonds. One reason that it had not initially been included was that it had a bad reputation: it was normally only used if direct financing could not be afforded. Another reason was that the proposed interest rate swaps would have been