Residential Mortgage Securitisation: The Australian Perspective

Abstract

The purpose of this article is to examine the mechanics of and the structuring issues in a residential mortgage securitisation program in Australia. It focuses on practical issues, such as the structure of the RMBS program; procedural aspects of the mortgage origination process; the establishment of the SPV and the transfer of the lender's rights to it; the issuance of the mortgage-backed bonds; the credit enhancement mechanisms that are available; and related operational aspects, such as the appointment of a fund manager or other ancillary service providers. Finally, the article summarises the process of structuring a RMBS program and identifies the key issues that arise throughout the process that may be addressed through further research.