Beyond mortgage securitisations are cards and cards
The Australian Securitisation Forum conference for 2015 ran several panels and "in conversation" style discussions along the theme of "broadening the appeal of securitisation beyond the mortgage sector".The second half of yesterday's program therefore featured a number of non-bank securitisation market favourites, including Resimac, Pepper Group, FlexiGroup, Liberty Financial, Firstmac and Eclipx, a vehicle leasing and management player. One common factor for a successful securitisation program was to go to market and go often.In one of these sessions, Peter Riedel, chief financial officer for Liberty Financial reminded the panel and delegates that his company has been very active in the securitisation market for the past 16 years. "We have issued about 35 transactions in that time and raise $14 billion," he said, setting out his credentials. Liberty has also issued four securitisations that Riedel called "SME deals" - a combination of commercial property loans and residential mortgages.Liberty also issued its inaugural medium-term note issue earlier this year, raising $1.1 billion.Likewise, June McFadyen, group treasurer for FlexiGroup said that the company tries to be a regular issuer to the market - once or twice per year, even if these are for relatively small amounts - recognising the amount of work that there investors put into these transactions.Paul Jamieson, treasurer for Fisher & Paykel Finance in New Zealand explained that his firm runs two types of credit cards, and these provide the underlying collateral for two types of securitisations that generate fully revolving funding. "We've been able to tap that [asset pool structure] twice this year for NZ$50 million each," Jamieson said. "It's good to have reverse enquiry from investors," he added, noting that this requires educating investors to make sure they are comfortable with the protections inherent in the structure - said to be the closest any securitisation deal in this region comes to replicating the mastertrust structure popular in UK mortgage securitisations.Liberty suggested that the supply-side needed boosting, in that there were fewer and smaller ABS transactions being originated than RMBS transactions in Australian market.The sole investor on the panel was Pete Robinson, a portfolio manager at Challenger Investment Partners. He reminded his fellow panellists and conference delegates how important it was for any firm contemplating a securitisation to explain to potential investors how it makes its money, how it's operations are best funded and what are the key risks associated with that business."That's one of the hurdles in getting new investors into the market," he said.