Pepper prices $1bn securitisation

Successful result comes just two months after the completion of a $700m transaction in mid-June

Pepper prices $1bn securitisation


By Madison Utley

Pepper Group successfully priced its PRS 27 transaction on 12 August, issuing $1bn worth of bonds backed by Australian mortgages after strong support from investors led the group to increase the transaction from its initial deal size of $500m.

This pricing comes just two months after the group’s completion of a $700m transaction.

Pepper Australia CEO Mario Rehayem said, “I am delighted that Pepper has been able to achieve this upsized billion dollar transaction, in such short order following the completion of our last transaction in June.

“This result recognises Pepper’s reputation in the capital markets for quality underlying assets and provides Pepper with the ability to assist more customers achieve their lending goals in 2020.”

“While the transaction did not require involvement, direct or otherwise, from the Australian Office of Financial Management (AOFM), Pepper Group once again wishes to express its appreciation for their willingness to participate in the transaction, and their broader support of the Australian securitisation markets.”

Pepper Treasurer Andrew Twyford also welcomed the strong outcome for the group.

“Pleasingly, PRS27 was able to be executed in larger size and well within the pricing of PRS26 even though only 8 weeks have passed, underscoring the resilience of the Australian RMBS market,” he said.

“Participation from investors was strong. We welcomed a diverse range of new and existing domestic and offshore investors and thank them for their continued support of our programs.”

Pepper’s PRS program is comprised of a mix of prime and non-conforming mortgages and is designed to optimise the funding of its asset originations.

The transaction is scheduled to settle on 18 August 2020.

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