One feature of the Pepper Homeloans purchase of GE Capital's back book is the identity of, and the number of, investors in the subordinated and equity tranches of the funding.Pepper said there were five "mezzanine investors" assisting with the funding: Deutsche Bank, Varde Partners Asia, York Capital Management, Industry Fund Management's Alternative Fixed Income Fund and MKM Capital.Finding more than a single investor in the subordinated or equity tranches of mortgage-backed and asset-backed securities is comparatively rare in Australia since the credit markets froze over in late 2007 and early 2008.According to some accounts, it is the long-term investment appetite of Industry Funds Management for subordinated tranches of mortgage-backed bonds that has propped up the mortgage-backed sector in Australia in recent years.Without the co-investment of IFM the better publicised investments of the Australian Office of Financial Management (which invested in AAA rated securities) would not have fostered the rebirth of this market following the GFC.Scott Barker, investment director for IFM, said that the Alternative Fixed Income Fund, which invested in the Pepper purchase of the GE book, was a "focused, pure credit fund" with a 12-year history and a much wider investment mandate than funds that conformed to the composite index of fixed interest securities maintained by investment bank UBS.The Alternative Fixed Income Fund has around A$1.5 billion under management.Barker said of the fund's investment mandate: "It's a much broader universe. If the UBS composite bond index tracks 300 to 350 securities, our overall universe is around 1500 securities."We hold 100 issuers or so and around 150 different securities."Barker confirmed that the IFM fund was, as far as he knew, the only investor buying subordinated securities in mortgage-backed transactions in 2008 and for much of 2009.Even today IFM is one of very few buyers of subordinated paper, though Pepper has flushed out MKM (in turn funded by Australian institutions) as another local investor, along with two investors (Varde and York) that have supported Pepper's former owner Oakwood Capital in transactions in the UK.Bruce Potts, investment director at IFM and co-manager, with Barker, of the AFIF, commented on talk in the market that IFM may be getting choosier in its support for RMBS deals in the present market. "In 2008, we were underweight [regarding] our target allocation in the asset-backed sector because the pricing and relative value was not attractive."We've been increasing our allocation since then, thanks to attractive pricing."While we are not full yet, every deal brings us closer to that point.  So we must judiciously consider each opportunity when deploying our limited capacity. What that limit currently is, we won't say."Barker also noted that RMBS deals since the GFC are more attractively structured, so it is not just the higher returns that motivated IFM to increase the weightings of AFIF in this asset class over recent years.He also pointed out that regional banks and major banks were the buyers of their own subordinated securities and equity tranches in mortgage-backed transactions; for example, the National RMBS Trust 2011-1 priced yesterday (and