SYDNEY (Reuters) – Australian non-bank lender Columbus Capital has sold the first ever batch of mortgage bonds backed primarily by home loans to Chinese investors, funding operations in a segment that has been abandoned by the country’s four major banks.
The A$250 million ($168.85 million) residential mortgage-backed bond deal had been popular among Australian, European and Asian investors, Columbus’ treasurer, Karl Sick, said on Monday.
“In hindsight, we could have done a larger transaction,” Sick told Reuters in a phone interview.
“There is still a strong appetite in Asian countries to hold assets in other jurisdictions. This drives the acquisition of real estate in countries like Australia.”
The bonds are backed by 719 loans to properties in the eastern Australian states, 84% of which were to Chinese residents.
Australia’s four largest lenders dominate the country’s home lending market, but higher capital requirements and regulatory restrictions on risky lending have caused them to halt lending to foreign investors.