Can Australian RMBS market continue recovery?
The Australian residential mortgage-backed securities market has performed better than its peers for several years, thanks mainly to its blemishless default history. After a post-crisis slump, a revival of domestic issuance is under way; but it could take much longer for cross-border transactions to follow. Hardeep Dhillon reports
In the months preceding the credit crisis, Australian residential mortgage-backed securities (RMBSs) were the poster child for the success of the global securitisation market. With transactions showing unequalled collateral performance, global investors were sold on the Aussie RMBS story; buying paper in large quantities despite the razor-thin spreads on offer.
The peak came in February 2007 with the A$7 billion ($5.5 billion at time of issue) multi-currency transaction by the Commonwealth Bank
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