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Pepper Residential Securities Trust No. 20: 02 April 2018

As per previous Pepper issues, this issuance consists of notes backed by a pool of non-conforming mortgages originated by Pepper Homeloans Pty Limited through accredited mortgage aggregators and third-party brokers, and is secured by properties located in Australia.

The Eligibility Criteria for each mortgage loan (includes): is denominated in, and only payable in, Australian dollars; requires monthly or fortnightly payments sufficient to pay interest and fully amortise the principal over the loan term; the Debtor has no ability to make further advances under the Mortgage Loan other than with the consent of the relevant Warehouse Trustee in its entire discretion; the Debtor has no right to convert from a variable loan to a fixed rate in respect of Mortgage Loan; the Mortgage Loan is not a construction loan.

The portfolio consists of 2,250 variable-rate consolidated loans secured by first registered mortgages over residential real estate, where the average consolidated mortgage loan balance is A$444,444. Documentation level (by current balance): Full 65.33%, Alt 34.61% and Low 0.06%. Distribution by Repayment Type: Principal and Interest 74.85%, Interest Only 25.15%. Distribution by Occupancy Status: Owner Occupied 69.71%, Investment 30.29%. The WA current LVR is 70.9% and the WA seasoning is 5.62 months. Geographic Location: VIC Metro 29.66%, NSW Metro 26.80%, NSW Non-Metro 11.24% and Queensland Metro 9.93%.

CRR/405: On the Closing Date and thereafter Pepper will, as an originator for the purposes of the risk retention rules under Articles 404 – 410 (inclusive) of Regulation (EU) No 575/2013 of the European Parliament and Council, retain a material net economic interest of not less than 5% in this securitisation. As at the Closing Date, the EU Retention will be in the form of a pro-rata retention in each of the tranches sold or transferred to investors and will be comprised by Pepper holding 100% of the shares in the Retention Vehicles who will, between them, hold not less than 5% of the aggregate Invested Amount of each Class of Notes.

Compare/contrast: Pepper Residential Securities Trust No.19, La Trobe Financial 2017-2