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Second MTF medium term note issue oversubscribed

Second MTF medium term note issue oversubscribed

Motor Trade Finances Limited (MTF) has today issued $200m of medium term notes to institutional investors, in its second asset backed security issue.

The original offer of $150m was heavily oversubscribed, resulting in the offer increasing to $200m. A broad mix of offshore and domestic institutional investors are participating in the issue.

The medium term notes are issued by Trustees Executors Ltd, in its capacity as trustee of the MTF Valiant Trust 2014. The notes are backed by motor vehicle receivables originated by MTF dealers and franchises, who are all MTF shareholders, and have an aggregate expected term of up to four years.

Fitch Ratings has assigned its highest structured finance rating, AAA (sf), to $176.4m of medium term notes. A further $18.8m of notes rated from AA (sf) to B (sf) will be issued, with the balance of $4.8m of unrated notes held by MTF. The ratings assigned to the notes reflect the credit quality of MTF receivables, and the track record and industry experience of MTF.

Very little securitisation activity has appeared in New Zealand post the global financial crisis, with only four issues coming to market in recent years, one of which was the June 2012 issue of the MTF Zephyr Trust. The issue of all classes of rated notes to institutional investors is a further endorsement of the funding structure put in place in 2010 in response to the global financial crisis by MTF, its bankers and professional advisors.

Commonwealth Bank of Australia and Westpac New Zealand acted as joint arrangers and lead managers, assisting MTF to organise and place the notes with investors.

MTF is pleased with the strong investor support shown for the issue and welcomes the opportunity to broaden its investor base and provide MTF dealers and franchises with competitive, longer term funding.


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