Macquarie Bank priced U.S. $350 million of securities backed by Australian auto loans and leases via its SMART ABS Series 2015-1US Trust, according to a regulatory filing.
The $104 million money market tranche, rated P-1 by Moody’s Investors Service and F1 by Fitch Ratings, yields 0.40%.
There are also two classes of triple-A rated term notes, each split into a fixed-rate notes and floating rate notes. The $62 million class A2A notes with a weighted average life of 1.08 years pays 42 basis points over the Eurodollar synthetic forward curve and the $65 million class A2B notes with the same average life pays 42 basis points over one-month Libor.
The $69 million class A3A with an average life of 2.16 years pays 50 basis points over the interpolated swaps curve and the $50 million class A3B with the same average life pays Libor plus 52 basis points.
$127 million of class A2 notes due August 2017 and $119 million of class A3 notes due September 2018. The A2 and A3 notes will be split into fixed- and floating-rate tranches.
Novated leases represent a significant portion of the lease contracts included in the SMART pool, according to an offering circular. A novated lease is a type of motor vehicle lease common in Australia that allows a business to lease a motor vehicle on behalf of an employee. The employee, as lessee, leases a motor vehicle and then novates it to the employer who pays the lease rentals while the lessee remains its employee.
The lessee remains fully liable to perform and observe all of the other obligations under the lease agreement not related to payment of the rentals.
The pool is also comprised of hire purchase contracts where the purchaser of a motor vehicle obtains possession of the motor vehicle before paying in full for it or obtaining legal title. Under a hire purchase contract, the purchaser pays installments which together with an initial deposit (if any) and a final balloon payment (if any) enable Macquarie Leasing, as owner of the motor vehicle, to recoup its capital outlay and interest on that outlay. The purchaser has a guaranteed option to purchase the motor vehicle during the term of the hire purchase contract.
The pool has a weighted average seasoning of 6.44 months and weighted average remaining term of 3.6 years.
JP Morgan, RBS, Citigroup and Macquarie Capital are the joint lead managers.