Securitisation door ajar

Philip Bayley
The story for the domestic securitisation market is seemingly stronger than for the sovereign, bank and corporate bond market. Issuance volume at the end of the June 2010 half totals A$9.3 billion, compared with A$16.4 billion for all of 2009.

Prime, mortgage-backed securities accounted for 66 per cent of debt sold; low-docs 19 per cent, other asset-backed securities seven per cent and commercial mortgage-backed securities also seven per cent.

Average monthly issuance volume in the second half of 2009 was A$1.8 billion and this accelerated in the first quarter of 2010 to A$2.4 billion. But average monthly issuance fell to just A$0.8 billion in the second quarter of 2010.

However, on a positive note, the first euro and US s144A market securitisation issues were announced the week before last. Both issues are of reasonable size too, with the SMHL Securitisation Fund 2010-2E RMBS issue being upsized to A$1.2 billion on Friday, and the SMART Series 2010-1US Trust totalling just over A$660 million. Details of these debt sales are in the following article.