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National Australia Bank has announced the launch of its second multi-seller securitisation program, Quasar Securitisation Ltd. Quasar Securitisation Ltd will be launched in October 2001 with an initial A$3 billion funding limit. As a multi-seller securitisation vehicle, Quasar will enable the National's wholesale clients from a broad cross section of industries to securitise a range of assets and in doing so, access cost-effective, off-balance sheet finance. Securitisation programs allow a client to raise finance by selling a pool of assets from its balance sheet to an off balance sheet vehicle which issues rated term debt securities or asset-backed commercial paper to investors. The National launched Titan, its first A-1+/P-1 rated, multi-seller securitised program in April 1999 with a funding limit of A$1 billion. By January 2001, due to strong support from clients, the limit for the Titan program was expanded to A$5 billion. As well as providing funding from the traditional forms of securitised assets such as mortgages and lease receivables through Titan, the National has recently arranged transactions for clients involving margin lending and commodity-based receivables as well as unsecured personal loans. Quasar will bring even greater funding flexibility to clients with access to asset-backed commercial paper rated A-1 and A-2 by Standard & Poor's and equivalently rated term debt securities. These ratings enable the National to source debt funding for a broader range of client assets without the need to source the additional credit support typically needed to issue at the A-1+/P-1 ratings. Ross Bacon, the National's Global Head of Securitisation, said multi-seller securitisation programs were now very popular with clients. "Many corporate clients are now utilising balance sheet assets to access cost-effective finance through securitisation. "Clients can achieve cost effective funding, often improving their balance sheet ratios and, if desired, achieve anonymity in sourcing the debt markets," said Mr Bacon. Kristen Carroll, who is a Director, Global Securitisation at the National, also added: "The multi-seller approach, where a range of client assets can be securitised through the one vehicle, can provide clients with lower set up costs, a shorter time to market and access to a deeper pool of funding than other types of securitisation programs." The National is also now finalising a funding subsidiary in the United States for its first multi-seller securitisation program, Titan, which will provide an alternative and often cheaper source of funding for clients. Titan is also being rolled out in New Zealand to enable the National to offer the same off-balance sheet funding capability to its New Zealand clients.
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