Funding programmes

The major sources of funding for Achmea Bank are retail funding and funding in the form of unsecured and secured notes issued on the capital markets . The bank  is a frequent issuer in the debt capital markets as part of its regular funding operations. In order to maintain a well-diversified funding base Achmea Bank issues fixed income securities in a range of maturities, formats (senior unsecured, securitisations etc) with interest rates either being fixed or floating in international debt capital markets. The primary choice of currency at this moment is EUR.
The wholesale funding programmes that Achmea Bank has its disposal are:
 
• French Commercial Paper Programme
• European Medium Term Notes Programme
• Trustee
• Securitisation
• Covered bond
 
French Commercial Paper Programme
In 2013 the Bank set up a French commercial paper programme of EUR 1.5 billion. With this programme the Bank is able to access the international money markets to further diversify its funding mix for funding purposes up to a maximum term of 364 days.
 
European Medium Term Notes Programme
In October 2012 the Bank set up a EUR 10 billion European Medium Term Note Programme. The EMTN Programme is used both for public deals and private placements for tenors greater than one year.
The Bloomberg ticker for the bonds issued under the EMTN Programme is ACHMEA <CORP>.
 
Trustee
Under the Trust agreement the Bank periodically pledges mortgage receivables to Stichting Trustee Achmea Hypotheekbank as collateral for some of the bank liabilities such as private loans and secured medium term notes (the “Secured EMTN Programme”). In the event of default by the Bank, investors can recover their investments from the pledged mortgage receivables.

It has been agreed with the Executive Committee of the Trustee that the value of the pledged mortgage debts will at all times be at least 7.5% in excess of the nominal value of the securitised loans.
The Secured EMTN Programme is used to fund a limited portion of the mortgage portfolio.
 
Securitisation
Achmea Bank also uses securitisation as a funding source. In all securitisation transactions, the Bank assigns a portfolio of mortgage receivables to a special purpose vehicle (SPV) which issues Notes. With the proceeds of the notes the SPV can finance the assigned mortgage receivables, and with the received interest on the mortgage receivables the SPV can pay the interest on the notes. The director of these companies is Intertrust Management B.V. 
 
The securitisation vehicles of Achmea Bank are named Dutch Mortgage Portfolio Loans (“DMPL”), Dutch Residential Mortgage Portfolio (“DRMP”) and Securitized Guaranteed Mortgage Loans (“SGML”). The DMPL and DRMP securitisation transactions have been placed into international capital markets while the SGML securitisation transaction is a retained transaction whereby all the notes held by Achmea Bank.
 
The Bloomberg ticker for the bonds issued under the securitisation programmes is DMPL <MTGE>  DRMP <MTGE> and SGML <MTGE>.
 
Covered bond
Achmea Bank set up a EUR 10 billion covered bond financing programme in 2007. The Achmea Covered Bond Company (“ACBC”), a bankruptcy remote special purpose vehicle, provides the covered bond investors a guarantee for full payment of interest and principal on the outstanding bonds under the programme by pledging the mortgage receivables of the Bank to the ACBC and a parallel debt agreement with the Security Trustee. For investors there is a so-called ‘double recourse’ which means that in the event of default of the Bank an investor has recourse on the bank and on the underlying mortgage portfolio.
 
ACBC's management board is formed by Intertrust Management B.V.. The management of the Stichting Trustee Achmea Covered Bond Company is formed by SSG Trust & Corporate Services N.V..
The outstanding amount of the pledged mortgage receivables will at all times be at least 33% higher than the outstanding amount of the bonds issued under the programme. The programme is not registered with the Dutch Central Bank (DNB).
 
The Bloomberg ticker for the bond outstanding under the covered bond programme is ACHMEA <CORP>.