Non-banks announce RMBS, funding deals

La Trobe Financial has priced a $1.25-billion residential mortgage-backed securities (RMBS) issuance, marking the first RMBS transaction for 2021.

The Blackstone majority-owned lender said that around 65 per cent of the transaction was placed with institutional, real-money investors across the structure, while 71 per cent was placed with international investors.

It will pay 83 basis points over the bank bill swap rate (BBSW) on $937 million of A1 notes, which have a weighted average life of 2.5 years.

Pricing on $177 million of A2 notes, which have a weighted average life of 2.5 years was 105 basis points over BBSW.

The arranger of the deal was Macquarie Bank, while joint lead managers included the Commonwealth Bank of Australia (CBA), Citi, HSBC, Macquarie Bank, National Australia Bank (NAB), Natixis and Westpac.

La Trobe Financial said that it was able to complete the transaction with repeat support from domestic and global investment houses, with support seen across the structure with all notes oversubscribed. It also said that the transaction’s pricing outcomes have not been seen in the sector since the GFC.

The underlying mortgage pool is consistent with prior issuances from the lender, consisting of 68 per cent to self-employed borrowers, which it said is a traditionally underserved segment of the mortgage market.

The weighted average loan-to-value is 71 per cent (with no loans approved at greater than 80 per cent LVR), while super-prime self-managed superannuation fund (SMSF) investment loans comprised 14 per cent of the pool and 92 per cent of the pool has nil prior credit events, the lender said.

Commenting on the transaction, La Trobe Financial president and CEO Greg O’Neill said: “This is our 12th successful issuance to market since 2014 that sits alongside over $30 billion of fully repaid term debt and warehouse funding lines since inception in 1952.

“RMBS is one of our important funding channels to the business, and this new funding will continue to support underserved borrowers as the Australian economy rebounds from COVID-19.”

The lender’s deputy CEO and chief investment officer, Chris Andrews, said: “The pricing and order book reflects a strong endorsement of La Trobe Financial’s high-quality assets, expertise and long, consistent, track record as Australia’s oldest diversified asset manager.

“With the current trend of loan originations now at over $12 billion per year, this issuance complements our current institutional mandates and our nationally and internationally awarded $6-billion retail credit fund.”

La Trobe Financial’s chief financial officer, Martin Barry, said the latest issuance has expanded the lender’s RMBS funding channel comprising of around 52 active holders of its paper, while the issuance was 1.5 times over bid.

“The proceeds of the issue will be used by La Trobe Financial to continue writing home and business loans for everyday Australians at a critical time in the history of our economy,” he said.

“We welcomed a significant large global investor to our existing 52 investor-strong RMBS program and are delighted by the interest we have received both offshore and domestically as we build out our diverse global investor base.

“With this RMBS transaction, we achieved our goal of industry-leading pricing, notwithstanding increased levels of market supply and note participation from a select group of chosen investors comprising 10 domestic, five from Asia, five from the United States and two from Europe or the UK.”

Plenti doubles renewable energy funding capacity

Fintech lender Plenti has announced that it has doubled the funding capacity of its renewable energy and personal lending warehouse facility from $100 million to $200 million.

The lender said that funders – including a big four bank and other domestic investors – had approved the funding limit increase.

It also said that the additional warehouse capacity has brought its total warehouse funding capacity to $550 million (including the recently increased automotive warehouse funding facility).

Plenti said the demand for renewable energy systems has continued to increase, with 370,000 homes installing solar systems in 2020, up from 280,000 in 2019.

In its trading update for the March quarter, the lender had flagged that it expected to upsize its personal and renewable warehouse in the coming quarter.

Commenting on the warehouse facility increase, Plenti CEO Daniel Foggo said: “With faster, simpler finance that offers better value, Plenti has been successfully taking market share in the renewable energy and personal loan verticals.

“This additional funding will enable our continued growth.”

Plenti recently launched an interest-free finance product in the renewable energy vertical, following the completion of a pilot program.

Resimac settles $1-billion RMBS deal

Non-bank lender Resimac has announced the financial close of the Resimac Bastille Series 2021-1NC non-conforming RMBS transaction, with a deal size of $1 billion.

This is Resimac’s second RMBS transaction for 2021, and represents 30 per cent of its total non-conforming funding, the lender said.

CBA and NAB acted as co-arrangers of the RMBS deal.

Speaking about the deal, Resimac group treasurer Andrew Marsden said: “This deal supports the market-leading offering that Resimac provides to self-employed borrowers and borrowers who fall outside traditional lending guidelines.

“Resimac’s growth aspirations are supported by strong demand for RMBS in the capital markets, with sound underlying credit performance as business conditions improve.”

Resimac recently announced the completion of the $1.5 billion Resimac Premier Series 2021-1 RMBS dual currency transaction, marking its largest deal since 2006 and first transaction for 2021.

[Related: Non-bank completes $2bn RMBS issue]