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Firstmac completes $600m RMBS issue

Firstmac completes $600m RMBS issue

Non-bank lender Firstmac has priced a $600-million residential mortgage-backed securities issue at 1.05 per cent over the bank bill swap rate.

Firstmac CFO James Austin said that the success of the deal showed the confidence of major institutional investors in Firstmac’s online loan book and the quality of its customers.

“This was a pleasing result which recognises the fact that we have among the lowest rate of mortgage arrears and defaults in the country, and well below those of the major banks,” Mr Austin said.

“It is a strong endorsement of our non-bank lending model and our industry-leading credit policies.”

This issue attracted a large number of new accounts, particularly from South East Asia, as well as continued interest from Japan and the UK.

Mr Austin said that the dual currency AUD and USD issue, which was listed in Singapore, was upsized from its original size of $500 million due to significant oversubscription. The final and maximum deal size was several times subscribed across all tranches with the A1-U 3x, the A1A 2x, the A1-B 1.8x, and the A2 4x subscribed.

“It was particularly pleasing to attract many first-time investors to the Firstmac program,” Mr Austin said.

The issue brings the total amount of RMBS issued by Firstmac since 2003 to more than $20 billion.

Its most recent prior RMBS issues were $600 million issue in November 2017, $1 billion in September and $1.7 billion in March 2017.

The latest issue was jointly led by National Australia Bank and United Overseas Bank.

Firstmac completes $600m RMBS issue
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