European pension fund manager, Santander , has completed a € 2.3bn trade to insure loans of PGGM , in a deal that highlights the growing appeal of exotic financial instruments in a world of ultra-low interest rates. Since 2006, the asset manager has made similar risk-sharing deals with a number of banks on several continents, including Rabobank, Citibank and Credit Suisse. The "synthetic" securitisation deal will involve PGGM selling credit insurance against potential losses on a portion of eight Santander loans to small and medium enterprises (SMEs).
European pension fund manager, Santander , has completed a € 2.3bn trade to insure loans of PGGM , in a deal that highlights the growing appeal of exotic financial instruments in a world of ultra-low interest rates. The "synthetic" securitisation deal will involve PGGM selling credit insurance against potential losses on a portion of eight Santander loans to small and medium enterprises (SMEs).