Pepper launches multi-currency RMBS deal with green tranches

Tuesday, 27 November 2018

On 27 November, Pepper Group (Pepper) launched its indicative A$750 million (US$541.6 million) equivalent residential mortgage-backed securities (RMBS) transaction, PRS 22. The forthcoming deal includes notes denominated in Australian dollars, euros and US dollars. The Class A1-G€ and Class A1-Ga notes will be exclusively backed by green mortgages.

PRS 22 indicative price guidance and structure

TrancheIndicative volume (m)Expected ratings (S/M)Weighted-average life (no. of years)Indicative price guidance (bp/1m BBSW)
A1-u US$215 AAA/Aaa 1.5 ND/1m US LIBOR
A1-a A$ND AAA/Aaa 2.6 140-145 area
A1-G€ €ND AAA/Aaa 2.6 90-95 area/3m EURIBOR
A1-Ga A$ND AAA/Aaa 2.6 140-145 area
A2 A$111 AAA/Aaa 4 210-220 area
B A$52.5 AA/NR 4 235-245 area
C A$21 A/NR 4 310 area
D A$16.5 BBB/NR 4 410 area
E A$9 BB/NR 3.9 610 area
F A$7.5 B/NR 2.9 720 area
G A$7.5 NR/NR 5 ND

Source: Westpac Institutional Bank 27 November 2018

Westpac Institutional Bank is arranger for the transaction, and joint lead manager for the Australian dollar notes alongside Commonwealth Bank of Australia and National Australia Bank. Natixis and Standard Chartered Bank are joint lead managers for the euro denominated tranche and Citi is sole lead manager for the US dollar denominated tranche. Pricing is expected on or before 30 November.