Given unprecedented Australian RMBS issuance of over A$20 billion ($14.6 billion) in the second quarter, the razor-thin spreads that have characterized transactions throughout 2006 could not be expected to continue indefinitely. And early evidence of pricing moving outwards - at least on triple-A tranches - could be seen on transactions completed last week by Heritage Building Society, Bluestone Group and Adelaide Bank.

Heritage closed an A$750 million prime RMBS through its HBS Trust facility. Societe Generale and Westpac Institutional Bank acted as joint lead managers on the transaction, which unusually featured no low-documentation mortgages.

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