After a bumper year in 2021, when the Australian securitisation market recorded around A$60 billion of transactions, issuance fell back to around $54 billion last year. 

Non-bank mortgage lenders accounted for most of the fall. They were hit by a combination of lower lending volumes and reduced investor demand for mortgage-backed securities.

Non-bank lenders relying on the mortgage-backed securities market for funding reported towards the end of last year that they were having trouble competing with bank pricing in the prime mortgage market.

AFG reported a drop in lodgements in the second half of the 2022 calendar year and Resimac reported that the value of its home loan book fell.

According to data compiled on the Australian Securitisation Forum website, Firstmac, Resimac, La Trobe Financial and Liberty were among the RMBS issuers that reduced their activity over 2022.

RedZed financial controller Lisa Hood, who spoke at the ASF conference in December, said investor appetite “narrowed” through the year and some long-standing investors did not participate in transactions.

In the asset-backed securities market, trouble-plagued buy now, pay later provider Zip cut back heavily.