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By: Staff Reporter
Major European investors are eyeing off Australia’s mortgage-backed securities, according to FirstMac.
The non-bank lender’s managing director Kim Cannon said European investors are currently calling on the federal government’s Australian Office of Financial Management (AOFM) to consider supporting foreign currency transactions.
If the AOFM allows this to occur, Mr Cannon said it will significantly improve lending competition within Australia.
“It will open up competition in the Australian market again,” he said.
“European investment would allow the non-bank and regional banking sector to seriously challenge the dominance of the major four banks – a positive for customer choice.”
“There is a wall of money that investors want to release from Europe into Australian mortgages,” Mr Cannon said.
However, Mr Cannon, who is currently attending the Global ABS 2010 forum in London, said the cost of swapping from Euros into Australian dollars is a major limiting factor.
“The Australian industry attending the forum is trying to devise innovative ways to facilitate European investment at the right price,” he said.
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