Scottish law firm Shepherd and Wedderburn said it acted alongside Allen & Overy on a £6.1 billion securitisation of residential UK mortgages by US investment firm Cerberus Capital Management.

Shepherd and Wedderburn partner Hamish Patrick and solicitor Neil Campbell advised Morgan Stanley — the arrangers and joint lead managers of the securitisation — on all Scots law matters.

The transaction is the latest in a series of big residential mortgage portfolio transactions on which the Shepherd and Wedderburn banking and finance team has acted.

The £6.1 billion deal is the largest residential mortgage-backed securitisation since the financial crisis of 2007-08.

Shepherd and Wedderburn said the bonds in the £6.1 billion securitisation are backed by a pool of mortgages from the legacy mortgage book of NRAM, the former Northern Rock mortgage business nationalised in 2008.

This latest transaction follows Shepherd and Wedderburn’s work on the sale of the £13 billion mortgage portfolio by UK Asset Resolution to Cerberus and its affiliates in December 2015.

The latest transaction consists of seven rated tranches of bonds, the largest of which is a £4.7 billion tranche rated AAA by Standard & Poor’s, Moody’s Investors Service and Fitch Ratings.

“The transaction is of great significance to the market,” said Patrick.

“Not only is it the largest RMBS since the global financial crisis but it also demonstrates the growing market confidence in assets such as residential mortgage portfolios.

“We expect to see more deals like this in the near future.”