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Non-bank lender reveals $280m green ABS

Plenti has priced its latest asset-backed securities transaction and its first transaction backed partly by renewable energy.

Plenti Group Limited (Plenti) has named its next asset-backed securities (ABS), with the fintech lender pricing the renewable energy and personal loan-backed transaction at $280 million. 

Named the Plenti PL Green ABS 2022-1, this latest transaction follows Plenti’s inaugural automotive ABS, issued last year, and is currently expected to settle by sometime around 10 March 2022. 

As was the case with Plenti’s previous ABS, NAB acted as arranger of this transaction, while both the major bank and Deutsche Bank were joint lead managers.  

Plenti has said that the pricing achieved on the transaction will substantially reduce its funding costs, and that the reduced equity requirement relative to the lender’s renewable energy and personal loan warehouse facility will release “capital back to the business to fund further loan book growth”.

Last May, the fintech lender announced that its funding capacity of this warehouse facility had doubled to $200 million.

Further, the lender has said that this latest transaction’s credit support required by Moody’s at each rating level “reflects the exceptional credit performance and credit profile of the underlying renewable energy and personal loans”. 

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Almost half of the notes (48 per cent) are said to be rated AAA by Moody’s. 

Plenti chief financial officer Miles Drury said that the non-bank’s successful completion of its second ABS transaction, and its first transaction backed by renewable energy and personal loans, will “further diversify and deepen” its funding structures while also “reducing our cost of funding”. 

Mr Drury said these were two of Plenti’s key strategic objectives. 

“Despite a backdrop of geopolitical instability and market volatility, we were pleased with investor support for the transaction which demonstrates their confidence in the Plenti business and our ongoing growth opportunity,” he added. 

“The inclusion of a substantial green-certified tranche in the transaction supports Plenti’s ambition of helping Australian households transition to renewable energy and improve their carbon footprint.”

The continued focus on renewable energy mirrors Plenti’s announcement last year that it would be introducing a buy now, pay later finance option for the installation of renewable energy technology in residential buildings. 

Earlier this year, the lender confirmed that during the December quarter, it had reached a record figure of originations in renewable energy loans, as well as within its personal loan and automobile segments. 

The lender flagged at the time that this growth in renewable energy was in part driven by “increased finance penetration with existing merchant partners” as well as partnering with large energy retailers. 

[Related: ​​Non-banks announce RMBS, funding deals]

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