REDS EHP Trust (Series 2018-1): 23 November 2018
The Bank of Queensland established a securitisation programme known as the REDS programme in February 1998, pursuant to the Master Trust Deed, for the purpose of enabling the Trustee to issue debt instruments and to apply the proceeds of those debt instruments to invest in assets originated from time to time by the Bank of Queensland group. The Master Trust Deed provides for the creation of an unlimited number of series trusts.
On the Closing Date, the Trustee will use the proceeds from the issue of the Notes to purchase a pool of hire purchase receivables, lease contracts and specific security agreements relating to vehicles and commercial plant and equipment (the EHP Receivables) and related Retained Title Rights, mortgages and collateral securities. These EHP receivables will be purchased from the seller and the purchase price for the EHP receivables will be equal to the total principal balance outstanding as at the cut-off date in respect of the purchased EHP receivables.
Loan eligibility criteria (includes): is denominated and payable in Australian dollars in Australia; relates to the financing of an asset which is a new or used car, truck or bus, or an asset which is commercial equipment which is leased for use in Australia; requires the Obligor to make payments (including any final balloon payment) which will amortise the outstanding balance of the receivable to zero over the remaining term of the receivable; does not have a Principal Balance in excess of A$ 1mln; does not have arrears days greater than 30 and it is not otherwise in default; is not a vendor finance product; bears a fixed interest rate for its remaining term; has an obligor which is a resident of Australia.
The collateral consists of 15,159 contracts secured on 19,103 assets, where the average balance (per contract) is A$51,693 and the largest contract in the poll is for A$929,530. Finance type (by outstanding balance): SSA 90.84%, Finance Lease 7.29% and CHP 1.87%. Payment frequency (by outstanding balance): monthly 92.23%. Asset type: Trucks, Cars, Buses 51.98%, Mine, quarry, construction 16.90%, Bodies - vehicles, trailers 12.28% and Agricultural machinery 10.83%. Obligor industry: Building & construction 25.00%, Transport 22.69%, Agriculture & farming 16.02% and Professions & business services 15.75%. Regional concentration: Queensland 44.41%, NSW 22.80%, Victoria 17.94% and Western Australia 7.90%. The WA seasoning is 18 mnths.
EU Risk Retention: Bank of Queensland, as originator, will retain a material net economic interest of not less than 5.0% in the securitisation in accordance with the text of each of Article 405, Article 51, and Article 254 of Regulation (EU) No 2015/35 (the Solvency II Regulation). As at the Closing Date, such interest will be comprised of an interest in the first loss tranche and other tranches having the same or a more severe risk profile than those sold to investors as required by the text of Article 405. Such retention requirement will be satisfied by Bank of Queensland holding the Class B Notes.
Compare/contrast: REDS EHP Trust (Series 2015-1), CNH Capital Australia Receivables Trust 2017-1, Flexi ABS Trust 2018-1