Slaughter and May advised NewDay Cards on its first US dollar and 144A debt issue under credit card master trust securitisation

Slaughter and May advised NewDay Cards Ltd (NewDay Cards) and its affiliates in relation to a public debt issue under its own-brand credit card securitisation.

The transaction involved the issuance, through a master trust structure, of $93 million and £261.84 million of Series 2018-1 Floating Rate Asset Backed Notes (the Series 2018-1 Notes) by NewDay Funding 2018-1 Plc (the Issuer). The issuance was the first dollar issuance from any of NewDay Card’s funding structures and also the first such issuance under Rule 144A under the US Securities Act.

The Series 2018-1 Notes are ultimately backed by income from a portfolio of credit card receivables beneficially owned by NewDay Funding Receivables Trustee Ltd (the Receivables Trustee).

The Series 2018-1 Notes have been listed on the London Stock Exchange and comprise $93 million Class A1 Notes (rated Fitch:AAAsf/DBRS:AAA(sf)), £100 million Class A2 Notes (rated AAAsf/AAA(sf)), £26.18 million Class B Notes (rated AAsf/AA(high)(sf)), £38.76 million Class C Notes (rated Asf/A(high)(sf)), £48.28 million Class D Notes (rated BBBsf/BBB(low)(sf)), £26.18 million Class E Notes (rated BBsf/BB(low)(sf)) and £22.44 million Class F Notes (rated Bsf/B(high)(sf)). The Class A1, Class A2, Class B, Class C and Class D Notes were publicly issued, whilst the Class E and Class F Notes were retained by Newday Funding Transferor Ltd, an affiliate of NewDay Cards.

An innovative feature was added to the Class A1 Notes allowing the Issuer to reset the scheduled redemption date and rate of interest for the Class A1 Notes and giving Class A1 Noteholders a corresponding put option upon such reset.

BNP Paribas, Citigroup Global Markets Limited, Santander Global Corporate Banking and Société Générale S.A., London Branch acted as joint lead managers and Merrill Lynch International acted as a co-manager.

Under the securitisation structure, the Receivables Trustee has appointed NewDay Cards as servicer in respect of the portfolio. Legal title to the receivables within the portfolio remains with NewDay Ltd, which is an authorised payment institution and a wholly-owned subsidiary of NewDay Cards.

The transaction was co-arranged by Santander Global Corporate Banking, Societe Generale and NewDay Cards.

Paul, Weiss, Rifkind, Wharton & Garrison provided US law advice to NewDay Cards and its affiliates.

Clifford Chance provided English and US law advice to the joint lead managers and the co-arrangers.

Richard Jones Partner
Gareth Miles Partner
Alex Sim Associate
Kristina Locmele Senior Counsel