St George Bank has become the first Australian bank to securitize auto loans, putting its weight behind the domestic market's shift towards non-mortgage asset securitization and underlining growing investor acceptance of the trend with by far the biggest deal of its kind yet seen in the sector.

The bank's Crusade Auto Trust No. 1-1999 issued A$571 million (US$364 million) of floating rate notes consisting of three senior Class A tranches, two subordinated lines and a seller note. The structure reflected the tailoring of the Macquarie Bank-led issue to investor demand. It also provided the framework for the credit enhancements that were a key feature of the transaction, given the riskier nature of the underlying assets compared to those that underpinned the market's five previous auto or auto-related deals.

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