Competition in the housing loans market is being bolstered by a revival of wholesale funding, with Australian Finance Group re-launching its securitisation business and Police & Nurses Credit Society launching its first-ever issue of mortgage-backed secur
Competition in the housing loans market is being bolstered by a revival of wholesale funding, with Australian Finance Group re-launching its securitisation business and Police & Nurses Credit Society launching its first-ever issue of mortgage-backed securities.
This follows Bankwest’s successful issue of $750 million of mortgage-backed securities earlier this month.
The securitisation market died after the global financial crisis, erasing one of the main funding options for non-bank lenders.
Its gradual revival, helped by backing from the federal government’s Australian Office of Financial Management (AOFM), augurs well for competition in the housing loans market.
West Perth-based mortgage aggregator AFG has secured a ‘warehouse’ facility with National Australia Bank, which will enable it to fund its wholesale mortgage business and distribute home loan products to housing loan brokers across the country.
Managing director Brett McKeon said the facility would help AFG members drive further competition in the lending market.
“The only way to drive competition in the Australian market is to ensure that consumers have multiple home loan options from a diverse range of mortgage funders,” Mr McKeon said.
“The re-launch of AFG Securities requires real skin in the game and shows our commitment to our members and to their customers who are looking for a viable alternative for their mortgage.
“The addition of AFG Securities products to the full suite of lenders on our panel will support our brokers to deliver the right product from the right lender to suit each and every one of their customers,” Mr McKeon said.
Meanwhile, Police & Nurses chief executive officer Fred Huis said he was very pleased with the support provided by the AOFM and domestic wholesale investors for its first public residential mortgage backed securities transaction.
The transaction was launched at $250 million and subsequently upsized to $275 million.
“The transaction will enhance Police & Nurses’ ability to continue and expand its lending to its members in the future,” Mr Huis said.
ANZ was the sole arranger and lead manager of the Police & Nurses transaction, which is scheduled for settlement on 3 December.
The AOFM purchased $111 million of the notes.
“ANZ is pleased to bring a first time credit society issuer to the capital markets. The upsizing of the transaction is a strong result,” ANZ executive director, structured capital markets Dom Di Gori said.
