Mobius completes lease-backed ABS

Published July 31, 2006 12:00 AM EDT 2 Min Read

Australia’s Mobius Financial Services, a joint venture established by Allco Finance Group and Australian Financial Investments Group to finance asset origination through securitization, last week completed its first equipment lease-backed ABS.

Commonwealth Bank of Australia acted as sole lead on the A$163.3 million ($124.4 million) offering, sold through the Mobius ELR Trust facility.

The transaction was backed by 15,820 leases, with an outstanding principal of A$138.7 million and average seasoning of eight months. Commercial contracts – primarily originated for IT equipment – accounted for 91.3% of the pool.

The A$119.7 million class A notes – rated triple-A by Fitch Ratings and Moody’s Investor’s Service – priced at 28 basis points over the Bank Bills Swap Rate (BBSW) for a 1.7-year average life.

In addition, the A$30.3 million class-B piece -rated BBB’/’Baa1′ – priced at 78 over for 2.6-years. Pricing for three subordinated tranches totaling A$13.3 million was not disclosed.

When the transaction was initially marketed in mid-July, the borrower would have hoped to finish about three to four basis points inside the final spread levels. However, some widening in the credit markets over the past two weeks – which also affected the latest prime RMBS by Macquarie Securitisation (ASR, 07/24/06) – caused Mobius to readjust its expectations.

According to market sources, nine accounts participated in the transaction with 60% of the bonds placing with domestic investors and the remainder ending with Asian and European buyers.

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