Rated Mortgage Bonds Media release – 22 November 2006
Deutsche Bank launches new Mortgage Backed issue
Deutsche Bank, as Lead Manager, today launched a new programme of Rated Mortgage Bonds to the New Zealand public. This
is an issue of secured first ranking bonds backed by mortgage backed securities, which carry an investment grade credit
rating of BBB from Fitch rating agency. The notes are expected to be listed on the NZDX exchange.
The programme was created by Propertyfinance group (PFG), a Christchurch based non-bank property lender with offices in
Auckland and Wellington. PFG develops innovative lending and investment products to the New Zealand market and currently
has $350m of assets under management. PFG does not guarantee any obligation to holders of the Rated Mortgage Bonds.
The first issue under the programme is for up to $39.8 million of bonds. 2 types are available backed by either
Residential or Commercial mortgage backed securities. “The underlying collateral is securities backed by first ranking
mortgages on New Zealand property so its an investment that we expect many New Zealanders will identify with” said Paul
Mowbray, Head of Debt Capital Markets at Deutsche Bank.
Mortgage backed securities are an established asset class in international markets. “They are a significant proportion
of the debt markets in Australia, Europe and the United States and global investor demand is very strong.”
A total of $15 billion of mortgage backed securities were issued in Australia last year. A lot of the issuance in
Australia has resulted from the growth in non-bank mortgage lenders, who are using this funding mechanism to efficiently
fund their mortgage book.
Deutsche Bank’s Paul Mowbray says “We expect this market sector could reach $1 billion in the next three years,
supported by investor demand for rated bonds and the increasing liquidity of NZX listed debt products.”
The current offer closes on 26 January unless it is filled earlier.
Chairman of PFG, Mr Barney Sundstrum said the development was timely.
“There’s concern among New Zealand investors about the relative security and return on interest-bearing investments.”
“Until now, investors have had the choice of lower yielding bank deposits, on the one hand or finance company
investments of uncertain risk on the other. Rated Mortgage Bonds provides a product backed by mortgage backed
securities, which have long been available to institutions, to everyday investors who would otherwise purchase
debentures or hold bank deposits.”
“PFG have developed Rated Mortgage Bonds to provide the investor market with the clarity of investment in mortgages, the
security of property and lower ranked debt, and an independent credit rating to allow a wide range of investors to
select a return consistent with their risk appetite on an informed basis.”
For further information please contact your financial advisor or broker, or free phone 0800 40 66 40 for a copy of the
registered prospectus and investment statement.
Application has been made to NZX for permission to list the securities and all the requirements of NZX relating thereto
that can be complied with on or before the date of the distribution of the advertisement have been duly complied with.
However, NZX accepts no responsibility for any statement in this advertisement.
ENDS