Pepper Group

About Pepper Group

Pepper Group is a specialist residential-mortgage and consumer lender and loan servicer, operating in targeted market segments in Australia and internationally. Many of these segments are under-serviced by traditional bank and other prime lenders.

Pepper was established in 2000 and commenced operation as a specialist residential-mortgage lender in the Australian market in March 2001.

Pepper offers a broad range of lending products including residential mortgages, small-ticket commercial-real-estate-backed loans, auto and equipment finance, point-of-sale finance and personal loans. Pepper provides loan servicing for its own products as well as for third parties across residential mortgages, unsecured and secured consumer loans, and commercial-real-estate-backed loans. Pepper has become a specialist-lending and loan-servicing group through a combination of organic growth and targeted global acquisitions.

At 30 June 2020, Pepper had more than A$83.5 billion of assets under management.

Ownership and capital structure

Pepper is majority owned by leading global investment firm KKR & Co and by management.

SIZE OF LOAN BOOK A$20.5BN EQUIVALENT (GLOBAL)
MAKEUP OF LOAN BOOK PRIME RESIDENTIAL MORTGAGES: 32%

NONCONFORMING RESIDENTIAL MORTGAGES: 39%
PERSONAL LOANS, ASSET FINANCE AND OTHER: 29%

GEOGRAPHIC DISTRIBUTION OF LOAN BOOK AUSTRALIA: 67%
OFFSHORE (SPAIN, SOUTH KOREA, UK): 33%
OUTSTANDING DEBT ISSUANCE VALUE: A$19.9BN
NUMBER OF TRANSACTIONS: 37
Funding strategy

Pepper’s lending businesses have adopted a diversified approach to funding strategy, ranging from on-balance-sheet wholesale capacity through retail deposits in its South Korean mutual savings bank to traditional securitisation technology.

Pepper’s approach to securitised debt funding is to be a frequent issuer in benchmark size into a globally diversified investor base, across a number of asset classes and geographies. As part of this strategy, Pepper issues in a variety of tenors, currencies and repayment formats. Pepper began issuing in 2003 and the company has a 100% track record of calling every deal at the first available call date.

Pepper operates a proactive engagement model with its global investor base. This has included, over many years, face-to-face and other forms of one-on-one engagement to provide the current and prospective investor base the opportunity to meet and discuss all relevant topics including updates on corporate strategy, an indication of the issuance pipeline for the next 12-18 months and any new asset classes or platforms that will be coming to market.

This work is augmented with deal-specific roadshows when required. While face-to-face opportunities are likely to be limited in the near term, Pepper remains committed to meeting with investors at all times via videoconference or teleconference, to answer any questions they have and provide insights into Pepper’s programmes and the broader market.

Pepper issues Australian RMBS off two public platforms: Pepper I-Prime and Pepper Residential Securities (PRS). It issues ABS off its SPARKZ platform. It has a UK RMBS platform (Polaris), a UK second-lien RMBS platform (Castell) and a Spanish consumer ABS platform (Iberia).

FOR FURTHER INFORMATION PLEASE CONTACT:

Andrew Twyford
Treasurer
+61 401 039 700
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Steven Fischer
Deputy Australian Treasurer
+61 413 782 557
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www.pepper.com.au