Obligations à l'Habitat - OH

1	Who is the issuer?	Specialized credit institution
		Comments: Société de Financement de l'Habitat

2

Does the bondholder have recourse to the credit institution?

Yes, direct

3	Who owns the cover assets?	Credit institution, but pledged to the issuer (with transfer to the issuer upon trigger event)
		Comments: Article L. 515-19 provides a security to the benefit of the bondholders.

4	Is the issuer the originator of the assets?	No
		Comments: Art. L.515-35

1	Are the bonds governed by a special covered bond Legislation?	Yes
		Comments: Article L. 515-34 and seq. of the French Monetary and Financial code.

2	What is the legal framework for bankruptcy of the issuer of covered bonds?	General insolvency law Specific legal framework superseding the general insolvency law
		Comments: Article L. 515-27 of the French Monetary and Financial code excluding any extention of insolvency procedure of the parent company of the issuer.

1

What types of assets may be included in cover pools?

Mortgage loans (Mortgage loans for the purpose of this question are taken to include guaranteed real-estate loans.) Group originated Senior MBS Senior MBS issued by third parties

2	What is the geographical scope for public sector assets?	Other
		Comments: Not applicable.

3	What is the geographical scope for mortgage assets?	Domestic EEA Other
		Comments: Countries with the best possible rating with one of the rating agencies recognised by the French banking supervisor. In practise, SFHs have solely domestic loans for now.

4

Are regular covered bond specific disclosure requirements to the public mandatory?

Yes

1

LTV is calculated using which valuation?[4]

Market value

2	Are there any special LTV limits used solely for calculating collateralisation rates for the cover pool (if yes, specify)?	Residential       80 %
		Comments: Only loan amounts up to 80% LTV are taken into account in the asset test.

3

Do bondholders get the benefit of that portion of the loan which exceeds the LTV cap?

Yes

4a	Is there an LTV cap which makes the entire loan ineligible to be put in the cover pool (if yes, specify)?	No
		Comments: Only loan amounts up to 80% LTV are taken into account in the asset test.

4b	Is there an LTV cap which would require a loan to be removed from the cover pool?	No
		Comments: Only loan amounts up to 80% LTV are taken into account in the asset test.

5

Is there any additional LTV limit on a portfolio basis?

No

Exposure to market risk

1

Is exposure to market risk (e.g. interest rate, currency risks) required to be mitigated by law or contract?

Yes

2

What is the primary method for the mitigation of market risk?

Use of derivative hedge instruments

3

If the answer to the above question on market risk mitigation is “Use of derivative hedge instruments”, please specify whether those instruments are entered into:

By the time of issue of covered bonds or entry of asset in the cover pool

4

What type of coverage test is applied?

Nominal cover

5

What is the frequency of coverage calculations?

Monthly

6

What types of stress scenarios are applied?

Dynamic

7

What is the frequency of stress test calculations?

Monthly

Exposure to liquidity risk

8

Is exposure to liquidity risk required to be mitigated by law or contract?

Yes

9

What is the primary method for the mitigation of liquidity risk on interest payments?

Contractual arrangements, e.g. a requirement to establish a reserve fund

10

What is the primary method for the mitigation of liquidity risk on principal payments?

Contractual arrangements, e.g. maturity extension or prematurity test

11

Is there any grace period in case of a breach of liquidity risk mitigants?

No

12

What is the consequence of not fixing a breach of liquidity risk mitigants?

Programme freeze (neither sale of assets nor new issuance allowed) Event of default of the issuer

Monitoring of exposures to market and liquidity risk

13

Who monitors the maintenance of coverage tests?

Supervisory authority Rating agency Trustee/cover pool monitor

14

Are there any regular public reporting requirements for market and liquidity risk?

Yes

Overcollateralisation

15

Is mandatory minimum overcollateralisation required?

By legislation/regulation

16	What is the level of minimum mandatory overcollateralisation?	2 %
		Comments: 2% is level required by the law, and 8,1 % in the documentation.

17

If mandatory overcollateralisation is required, are the amounts above the minimum OC level protected?

Yes

18

Is there any grace period in case of a breach of the coverage test?

No

19

What is the consequence of not fixing a breach of the coverage test?

Programme freeze (neither sale of assets nor new issuance allowed) Event of default of the issuer

1

Is a special license required for the issuing of covered bonds?

Yes, but no additional requirements

2

Are there special reporting duties of the covered bond issuer to the supervision authority concerning covered bonds and the cover pool, which go beyond the regular banking supervision?

Periodic reporting required Reporting on demand for special occasions

3	What is the role of the banking supervision regarding covered bonds?	To check whether eligibility criteria are fulfilled and documented Checking quality of cover assets (real estate valuations, etc) Monitoring of exposure to market risk and liquidity risk Evaluation of operational risk To check minimum mandatory overcollateralisation requirements
		Comments: Done by the specific controller.

4

Is there a special role of banking supervision in crisis regarding covered bonds?

Safeguarding ongoing management of the cover pool directly or via a special administrator Involvement in transfer of cover assets and covered bonds to another credit institution

5	Is there a cover pool monitor independent from the issuer?	Yes
		Comments: There is an Asset Monitor and a specific controller.

6	If there is an independent cover pool monitor, what are its duties?	Performing audits of the cover pool Reporting duties to the supervision authority Verification of coverage tests
		Comments: There is an Asset Montor and a specific controller who gives a sepcial authorization for any issue superior to 500 mio euros.

1

Do covered bonds automatically accelerate when the credit institution goes insolvent?

No

2

What is the cover pool?

All qualifying assets

3

How are the covered bondholders protected against claims from other creditors in case of insolvency of the issuer?

Preferential claim by law Specific cover pool administration

4

Is there recourse to the credit institution’s insolvency estate upon a cover pool default?

Yes, senior to unsecured creditors

5

Are there provisions that require derivatives to continue in case of insolvency of the credit institution?

Yes

6

If derivatives are permitted in the cover pool, what is their ranking?

Pari passu to covered bond holders

1

Does the covered bond fulfil the criteria of UCITS 52(4)?

Yes

2

Does the covered bond legislation completely fall within the criteria of the Annex VI, Part 1, Paragraph 68 (a) to (f) of the Capital Requirements Directive (CRD)?

No

3

Are listed covered bonds eligible in repo transactions with the national central bank?

Yes

4

Are there any special investment regulations regarding covered bonds?

Yes

1

Link to National Association representing covered bond interests

Association

2

Link to national regulators and supervisors

List ACP - Autorité de Contrôle Prudentiel AMF - Authorité des Marchés Financiers

3	Fact Book Country Chapter	Chapter
		France

4	Hypostat Country Chapter	Chapter
		France.pdf