Mumbai: ICICI Bank has carried out the country''s largest rated securitisation transaction. The securities - Pass Through Certificates (PTC) - for an amount of Rs1,929.9 crore, is backed by its new and old car loans.
The securities, issued by Indian Retail ABS Trust under the bank''s securitisation programme, are backed by the new and used car receivables originated from ICICI Bank.

Credit rating agency Crisil has assigned the high investment grade rating (AAA) to these securities. The bank would assign the pool to the trust and will receive a purchase consideration equal to the pool''s principal outstanding.

The total rated securitisation amount consists of a liquidity facility of Rs76.65 crore and a credit enhancement of Rs77.75 crore. The balance Rs1,837.6 crore consists of the loan amount, of which new car loan receivables comprise 81.6 per cent and used car loan receivables account for 18.4 per cent.

The pool has a weighted average season of 6.4 months and is well diversified. It is predominantly current with about 95 per cent of receivables coming from contracts that do not have any overdues on the cut-off date.

"Including the credit opinions assigned to the liquidity and second loss facilities, the rated amount of Rs1,992.99 crore is the largest in any securitisation transaction in India,'''' a Crisil statement said.

Meanwhile, RBI deputy governor Vittal Leeladhar has said ICICI Bank with HDFC Bank, the two large Indian banks, can in fact be termed as ''foreign banks''.

''Besides the foreign banks, there are also two large Indian private sector banks in which the non-resident ownership is very close to 74 per cent permitted, which could, therefore, be considered as incorporated in India but predominantly foreign owned banks. These banks, together with foreign banks, have a combined market share in the country in the deposits, advances and off-balance-sheet business of 17.46 per cent, 18.65 per cent and 76.63 per cent, respectively,'' Leeladhar said.

He clubbed the two banks with other foreign banks operating in India to drive home the point that they together control more than 15 per cent of the banking business. This is a trigger point, since under the World Trade Organisation commitment, licences for new foreign banks may be denied when the share of foreign banks' assets in India (both on- as well as off-balance sheet items) exceed 15 per cent of the system.

''However, we have autonomously not invoked this limitation so far to deny licences to the new foreign banks...,'' he said.