ASX-listed non-bank lender Pepper Money has priced an $850-million residential mortgage-backed securitisation transaction (PRS30).
The program – which is Pepper’s third public securitisation in calendar year 2021, comprises a mix of non-conforming and prime mortgages, and is designed to enhance the funding of its Australian mortgage originations.
The non-conforming transaction (which is due to settle on 19 August 2021) would provide the lender with over $2.3 billion in aggregate of funding, with Pepper adding that it would provide a “strong funding foundation to drive its future growth”.
The A1 notes have been priced at the tightest level achieved by Pepper Money since before the GFC for a non-conforming transaction of a similar nature, it said.
The Commonwealth Bank of Australia acted as arranger while Macquarie Bank and National Australia Bank acted as joint lead managers.
Commenting on the deal, Pepper Money CEO Mario Rehayem said: “We are delighted to see strong support from new and long-term investors in debt capital markets for our prime and non-confirming issuances.
“Our issuance this year positions us well to leverage the opportunities for ongoing growth available to us, in particular in the underserved segments of both the mortgage and asset finance markets, where we have a strong track record and compelling customer value propositions.”
Treasurer Anthony Moir said the strong market response to the transaction has demonstrated Pepper’s established investor relationships and “exemplary track record of calling every term deal at the first opportunity and providing an attractive investment proposition for investors”.
[Related: Pepper Money to list on the ASX]