Emerald II - Second Reverse Mortgage Securitisation for Bluestone

Bluestone has completed its second (and also Australia's second) Reverse Mortgage securitisation – Emerald II.The notes were oversubscribed between 2.5 and six times, depending on the tranche, according to Bluestone Equity Release chief executive Peter McGuinness.
Spreads tightened between 25 and 45 per cent across the three tranches, he added, compared to Emerald I, which last year became Bluestone (and Australia’s) first-ever reverse mortgage securitisation.
“This reflects the increased confidence of investors looking at Bluestone Equity Release as an originator, and also in the asset class more generally.”
In turn, McGuinness said Bluestone customers now have “the confidence of knowing that their future loan advances are backed by AAA rated funding”.
The securitisation is the “first reverse mortgage deal in Australasia to have been rated by all three rating agencies”, he said.Details on the transaction are:
Emerald II Reverse Mortgage Series 2007-1 is Bluestone's and Australia's second Reverse Mortgage securitisation
Total of $124.2m in AUD issued notes; with 3 tranches $102.6m rated AAA, $11.2m of AA and $10.4m of A
Structure was rated by all 3 rating agencies and is the first Reverse Mortgage deal in Australasia to have been rated by all 3 rating agencies
Transaction is supported by a $71m liquidity facility, and $29m of committed and further advance facilities - all provided by Barclays
4 new investors were welcomed into the Emerald program. The majority (75%) of the notes were placed domestically, with the balance in Europe
Strong demand for the Notes, which were oversubscribed between 2.5 and 6 times, depending on the tranche
The deal was arranged by Barclays Capital
Spreads tightened between 25% and 45% over the 3 tranches, compared to Emerald I, reflecting the increased confidence of investors looking at Bluestone Equity Release as an originator, and the asset class more generally
Total Reverse Mortgage market grew to $1.5bn as at 31 December, with $700m of new Reverse Mortgage approvals in calendar 2006 (source: Deloitte Trowbridge,SEQUAL)
Bluestone Equity Release customers now have the confidence of knowing that their future loan advances are backed by AAA rated funding
Editor's Note
Bluestone provides specialist financial products to Australians and New Zealanders who fall outside the lending criteria of traditional lenders. The business has enjoyed strong growth since its launch in 2000 particularly amongst self-employed workers and the older community.
For further information, please contact:
Alistair Jeffery Group CEO, Bluestone Group Tel 02 8115 5010 fff123 Tony Pescott Chief Operating Officer, Bluestone GroupTel 02 8115 5020