Pepper Group’s PRS 27 transaction was successfully priced on Wednesday 12 August, issuing $1 billion worth of bonds backed by Australian mortgages. The transaction was up-sized from an initial deal size of $500m, following strong support from investors.
This pricing comes just 2 months since the completion of PRS26, a $700m transaction.
Pepper Group’s Australian 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, PRS26 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.”
Commenting on the strong outcome for Pepper, Andrew Twyford, Pepper’s Treasurer, said “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. 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 wishes to thank Commonwealth Bank of Australia (arranger), National Australia Bank, Westpac Banking Corporation and Macquarie Bank for their work as Joint Lead Managers and Citigroup Global Markets as Co-Manager.
Pepper’s PRS program comprises 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.