European issuance of bonds backed by debt such as mortgages will see slowing growth in 2006, but changes due under Basel II and the weight of money chasing such deals are likely to cut the interest investors receive, according to the new head of the market's leading trade body.

Rick Watson, appointed managing director of the European Securitisation Forum two weeks ago, said the group's latest survey showed that growth in issuance was likely to slow to 15 per cent in 2006 from more than 30 per cent seen in 2005.