Pepper Money Tests Dollar Funding Route in Rare Move for Specialists

Pepper Money, a UK non-conforming mortgage lender, is exploring the issuance of a US dollar tranche under its Polaris RMBS programme. This move marks an uncommon step for specialists in the industry, as they typically use sterling-denominated tranches.

The proposed deal includes two tranches: one in sterling and another in US dollars. Bank of America has been appointed sole arranger, with Barclays, Lloyds, MUFG, and Societe Generale serving as joint lead managers.

A spokesperson for Pepper Money said the company is 'exploring the potential for our first USD-denominated note issuance' to broaden its investor base and diversify its funding platform. The lender has not disclosed a pricing date or confirmed final tranche sizes.

The proposal comes as the UK specialist lending market continues to work through the aftermath of Market Financial Solutions' collapse in February 2026. This incident led to allegations of fraud, including claims that some loans were 'double pledged' against the same property assets.