International rating agency Moody's believes the Australian structured finance market will pick up in the second half of the year following a drop in such deals during the first six months of this year.The volume of Australian structured finance securities issuance fell 3% to A$16 billion compared with the same period in 2001. Moody's said the tail-off was caused by a number of cross-border residential mortgage-backed securities (RMBS) deals that were marketed in Q2 not now being booked until Q3 this year."Even though only a small number of transactions have so far been completed, Moody's believes the non-conforming RMBS market shows healthy developments, with the supply boosted to A$591 million from A$127.5 million in the first half of 2001," said Patrick Eng, senior vice-president in Moody's structured finance group. Eng said Moody's expected more Australian RMBS issuers to seek global MBS issuance to expand their cross-border investor base beyond the traditional euro market.
He added that the property trust sector should continue to drive commercial mortgage-backed securities issuance, albeit in modest volumes, in the near term.
Future asset-backed securitisation growth should stem from a broadening of asset class deals, with auto and equipment leases, residential development project financing and lease payments securitisations from high credit quality tenants the most likely areas.
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