Plans to reinvigorate non-bank lending are on track with the Australian Office of Financial Management (AOFM) inviting submission proposals for the first round of RMBS investments earlier this week.
The invitation kicks off a $4 billion plan announced by the treasurer last month to invest in non-bank RMBS and boost competition in the mortgage market.
The first selection round is for RMBS issues that are expected to be priced and placed between early November and the end of December. Each issue will be eligible for an investment of between $200-500 million from the AOFM.
The proposals will be assessed on the contribution they will make to maintaining competition in housing lending.
Non-bank lenders have welcomed the AOFM investment scheme as a step in the right direction but emphasised that more would be needed to maintain competition in the market.
$4b RMBS investment not enough: Mortgage Choice, First Mac 30-09-08
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