Canberra takes a bond ‘step change’ (The Australian)

The AOFM has started operating the $15bn Structured Finance Support Fund to help smaller lenders access funding during a period of market dislocation. Further detail on the fund provided on Tuesday evening said it was available to non-bank lenders and authorised deposit-taking institutions that did not have the collateral required to tap the RBA’s $90bn funding facility for banks. The AOFM will seek to invest in packages of loans — that are securitised — to assist smaller lenders while also considering making investments in warehouse facilities. On Friday, the AOFM started the operation of the structured fund, by investing $189m across six tranches of Firstmac’s $1bn mortgage bond. 

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28 Feb 2020

Funds cut risk, lift cash holdings (The Australian)

Firstmac chief financial officer James Austin said the residential mortgage backed securitisation market was showing “very little movement” in issuance prices.
RMBS are based on the performance of the underlying mortgages, so during the global financial crisis it was very much a credit event,” Mr Austin said. “In this case, the RMBS market will all be about how the Australian economy performs.

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