AOFM makes first two investments in RMBS
The Australia Office of Financial Management (AOFM) has made two investments of $600 million in Residential Mortgage Backed Securities (RMBS) under the Government’s initiative to invest $8 billion in RMBS.
The first agreement was reached for an issue of $600 million in RMBS by FirstMac with the ANZ Bank, HSBC and Macquarie bank as arrangers, while a second arrangement was reached for the same amount by Members Equity Bank, with Westpac and Credit Suisse as arrangers.
The AOFM is participating in each as a cornerstone investor and is contributing around $500 million to each.
The Federal Treasurer, Wayne Swan, said the completion of these two issues would help reinvigorate the RMBS market in Australia and contribute to competition in home lending.
“I am particularly pleased that other investors have been encouraged to participate in them, thereby adding to the total funds that will be available for new housing mortgages.”
The AOFM has also announced it will provide two further mandates for additional RMBS issues.
These mandates are for issues by Challenger Mortgage Management and RESIMAC. It is expected that these issues will be priced and placed during December.
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