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Plenti prices ABS transaction

by Kate Aubrey4 minute read

The fintech lender has announced the pricing of its asset-backed securities has jumped more than $100 million since the transaction was priced last year. 

In a trading update, Plenti Group Limited (Plenti) revealed it had priced its asset-backed securities (ABS) transaction covering automotive receivables Plenti Auto at $437 million.

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It comes following the inaugural transaction in August last year, through which it issued $306.3 million of notes to investors backed by secured automotive loan receivables.

The transaction is expected to settle around 16 June 2022 subject to customer’s satisfaction and is said to reduce funding costs on the underlying receivables and free capacity in Plenti’s renewable energy and personal loan warehouse facility.

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Commenting on the transaction chief financial officer Miles Drury said Plenti was pleased to be announcing the pricing of its automotive ABS transaction as it reflected the growth of its automotive loan originations.

“We are delighted this transaction has attracted strong support from domestic investors and several new large international investors, reflecting the continued credit strength of Plenti’s prime loan portfolio,” Mr Drury said.

The ASX-listed lender confirmed the transaction was rated by credit rating agencies Moody’s and Fitch and said the credit support required at each rating level reflected the “strength of the credit performance” and credit profile of the underlying loans.

NAB, Deutsche Bank and Westpac have acted as joint lead managers of the transaction, with NAB acting as arranger.

Marking its strength, Plenti reported its automotive division had seen a 151 per cent rise in originations year-on-year to $203 million worth, closing the quarter with $745 million in its loan portfolio, almost triple from the year before (up 182 per cent).

Overall, the lender revealed during its March quarter 2022 that its loan portfolio reached $1.3 billion, surging by 111 per cent year-on-year and up 17 per cent on the previous quarter.

It had also entered into a corporate debt facility agreement with an Australian funder in March, to provide capital for its growth. The facility was initially drawn to $18 million.

As the Reserve Bank of Australia lifted the cash rate by 50 bps and lenders begin to hike mortgage rates, Plenti previously stated its increased funding costs would be reflected in the borrowers’ rates and expects pricing to continue to increase over the coming month as the market adjusts.

[Related: Plenti hits record quarterly originations]

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