$2.5 billion RMBS sets new benchmark for Australian non-bank lending industry
Firstmac has set a new benchmark for Australian non-bank lenders, completing a $2.5 billion residential mortgage-backed securities (RMBS) issue – its largest to date.
The oversubscribed transaction has also set a new record for an RMBS issued by an Australian non-bank lender.
Attracting 2.4-times its initial launch volume, thanks largely to substantial interest from Japanese investors, the issue “reflects continued faith in our loan book”, said Firstmac chief financial officer James Austin.
It was priced at a tight margin of 95 basis points over the one-month bank bill swap rate (BBSW).
Brisbane-based Firstmac included a substantial Yen-denominated tranche, demonstrating the continued importance of Japanese investors in its funding program.
“We’ve developed strong relationships with leading Japanese institutional investors over the past decade, so issuing in Yen was a natural next step,” Austin said.
“Our benchmark prime RMBS continue to attract strong demand thanks to their exceptional credit performance – with arrears consistently lower than the major banks – and their appeal as conservative investments.”
The funding round, Firstmac’s fourth RMBS issue in 2025, brings its total issuance this year to $6 billion. Its mortgage portfolio continues to outperform, with 90+ day arrears at just 0.29% as of 30 September.
“This issue further strengthens our funding base and ensures we can continue to offer highly-competitive prime home loans to support real competition in the broker channel,” added Austin.
Lead managers on the issue were ANZ, Commonwealth Bank, DBS, JPMorgan, Natixis, NAB, SMBC and UOB, with Westpac as arranger.
