BankWest enters securitisation fray

BANKWEST is entering the securitisation market with an issue of $1.005 billion of mortgage-backed securities.

BankWest managing director Terry Budge said this would be the first of several issues.

The process of securitisation involves the transfer of the $1.005 billion of housing loans to the special purpose Securitisation of WA Notes Trust. As a result, the loans will be removed from BankWest’s balance sheet.

Sale of the mortgage-backed securities will be undertaken in Europe next week by lead manager Warburg Dillon Read.

The issue will comprise three tranches of senior notes and $29.4 million of subordinated notes, with an anticipated maturity of 5.7 years.

Credit ratings of AAA have been assigned to the senior notes by Standard & Poor’s, Moody’s and Fitch IBCA.

The subordinated notes have been given a AA- rating by Standard & Poor’s and Fitch IBCA.

The transaction will lift the bank’s Tier One capital ratio, which was 6.83 per cent on 31 August, by about 0.25 percentage points and will lift the bank’s total capital ratio by 0.45 percentage points.

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