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Suncorp RMBS prompts calls for additional AOFM support package

Staff Reporter 1 minute read

Suncorp Metway has issued $1.2 billion in residential mortgage-backed securities, effectively draining the last of the government’s $8 billion support package for the securitisation market.

The lender was mandated in June as one of the last recipients for Australian Office of Financial Management (AOFM) funding.

Only $547 million remains from the pool of government funds.

Suncorp’s decision to issue the securities yesterday has intensified the second-tier banks pledge to the government to announce a revised support package.

The program was announced last September and involves the government acting as a cornerstone investor to help get deals off the ground, despite the effective closure of the RMBS market.

Industry participants are calling for another round of $8 billion to stimulate competition in the sector.

Lack of funding has hampered the capacity of regional banks and non-bank lenders to write new mortgages, resulting in the Big Four banks increasing their market share to more than 90 per cent.

Suncorp RMBS prompts calls for additional AOFM support package
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