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ISCOVER
Staff Reporter
Firstmac has increased its Residential Mortgage-Backed Securities (RMBS) offer to $440 million due to strong demand from investors in Australia and abroad.
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The Firstmac Mortgage Funding Trust Series 3-2012 residential mortgage-backed notes were successfully placed and priced today, well above the initial offer size of $300 million.
Firstmac chief financial officer James Austin said the transaction attracted strong interest from offshore investors, primarily from the USA, Asia and Europe, who accounted for about one quarter of the deal.
Mr Austin said 11 real money accounts invested approximately 78 per cent of the transaction. Fund managers were traditionally Firstmac’s investor base.
“Pricing was much tighter this time than in Firstmac’s previous RMBS launch in August,” he said.
“The August deal was +160 while this deal priced at +145. We have also seen a considerable increase in offshore investors recognising the value of Australian RMBS.”
Firstmac has issued about $11 billion in RMBS since 2003, with the Australian Office of Financial Management (AOFM) taking a $1.5 billion stake.
The AOFM did not invest in the latest issuance, arranged by ANZ with joint lead Westpac.
The Firstmac 3-2012 placement included $331.8 million in class A-1 notes which priced at bbsw1m+1.45 per cent; $73 million in class A-2 notes which priced at a fixed rate of 5.0 per cent; and $18.5 million in class AB notes which priced at bbsw1m+3.00 per cent, all AAA-rated.
