The securitisation market is going through a purple patch, with Pepper Group pricing its latest non-conforming issue of residential mortgage-backed securities at the tightest margin since before the 2008 financial crisis.
Pepper raised A$750 million of funds through the transaction, PRS29 – its second RMBS this year.
Pricing on the A1 notes was 83 basis points over the one-month bank bill swap rate and pricing on the A2 notes was 110 bps over one-month BBSW.
Pepper treasurer Anthony Moir said the offer was “significantly oversubscribed”.
Other issuers have also reported very favourable conditions in the RMBS market. RedZed and Columbus have done record deals this year.
Resimac reported last month that its first issue this year, which raised $1.5 billion, was priced at a weighted average margin 30 bps lower than the deal it did in December.