This is nothing new – mortgage advances have been securitised on a substantial scale for many decades. Incidentally, the borrower would usually not even know that his or her mortgage loan had been securitised – the borrowers continue to send their instalments to the institution or “mortgage originator” which initially extended the loan.
This is the same rate as that which will prevail for the two fixed rate tenders to be implemented following today’s decision. Let me start by commenting on the reasons for this rise in interest rates, before the Vice-President says a few words about the move to a variable rate tender procedure.