Australian Finance Group's funding arm, AFG Securities, has priced a $1.2 billion Prime Residential Mortgage-Backed Securities (RMBS) transaction, matching the company's previous record issuance from February and taking total RMBS issuance to $13.1 billion since the program began.
The deal, AFG's 21st term Prime RMBS transaction, attracted strong demand from both domestic and international investors and is scheduled to settle on 29 September 2026.
AFG chief executive David Bailey (pictured) said the transaction marked another important milestone for the company.
"We are very pleased with the response to this transaction and the breadth of engagement from investors in Australia and international markets," Bailey said.
The transaction was structured across nine note classes. The two largest senior tranches, Class A1S and A1L, carry expected Fitch and S&P ratings of AAAsf/AAAsf and 10.00% initial credit support. Class A1S totals $384 million with an expected weighted average life of 0.4 years, priced at 73 basis points over BBSW, while Class A1L totals $696 million with an expected weighted average life of 2.9 years, priced at 103 basis points over BBSW. The Class A2 tranche, worth $60.59 million, carries the same AAAsf/AAAsf rating with lower credit support of 4.95%, priced at 120 basis points over BBSW. Mezzanine and junior tranches range from Class B, rated AAsf and priced at 140 basis points over BBSW, down through Classes C to F, with the unrated Class G priced without a disclosed margin.
More than half of AFG Securities' total outstanding funding is now sourced from long-term RMBS issuance, reflecting the growing role securitisation plays in the group's broader home loan funding mix.
Bailey said the transaction "further supports the strength and diversity of our funding program and provides an important foundation for AFG Securities to continue delivering competitive home loan solutions for AFG brokers and their customers."
The RMBS issuance follows a strong FY26 for AFG overall: the group's manufacturing loan book grew 30% to a record $7.1 billion over the year, supported by a broker network that expanded to more than 4,300 brokers writing one in nine Australian mortgages nationally.
Read the full AFG announcement.
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