Liberty prices $1.25 billion RMBS issue

17/10/2024

Liberty Financial Pty Ltd (Liberty) has priced the $1.25 billion Liberty Series 2024-2 RMBS issue, its eighty-third term securitisation. The Liberty Series 2024-2 Trust is Liberty’s fifty-third issue of securities backed by a portfolio of residential mortgages.

Given strong investor demand across all offered tranches, the transaction was upsized from a launch volume of A$750 million to A$1.25 billion. BofA Securities is the sole Arranger. BofA Securities is also a Joint Lead Manager along with Commonwealth Bank of Australia, Deutsche Bank, National Australia Bank, SMBC Nikko Capital Markets and Westpac Banking Corporation. The transaction comprises A$1.25 billion of notes rated by Moody’s Investors Service (Moody’s) and Fitch Ratings (AAA notes only).

  • The A$425 million Class A1a notes to be rated Aaa(sf)/AAAsf with a weighted average life of about 0.4 years, priced at a margin of 85 basis points over one-month BBSW.

  • The A$575 million Class A1b notes to be rated Aaa(sf)/AAAsf with a weighted average life of about 2.5 years, priced at a margin of 125 basis points over one-month BBSW.

  • The A$186 million Class A2 notes to be rated Aaa(sf)/AAAsf with a weighted average life of about 3.4 years, priced at a margin of 145 basis points over one-month BBSW.

The pricing of the Class B, C, D, E and F notes to be rated Aa2(sf), A2(sf), Baa2(sf), Ba2(sf) and B1(sf) is not disclosed.

The issue consists of a pool of residential mortgages with a weighted average loan-to-value ratio of 62% and is seasoned at 20 months. The Liberty Series 2024-2 transaction will settle on 25 November 2024.

Peter Riedel, Chief Financial Officer at Liberty, said: “Liberty is a leader in providing households and small businesses with the freedom to choose from a wide range of products and services to meet their financial needs. We are grateful for the support investors have extended to our business.”

Liberty has a rating of “STRONG” from Standard & Poor’s for the servicing of commercial mortgages as well as prime and non-prime residential mortgages and auto loans. Liberty is also Australia’s only investment-grade rated non-bank issuer (BBB, outlook stable by S&P) and one of only a few lenders with an unblemished capital markets record with no ratings downgrades or charge-offs ever experienced by its securitisation program.