NEWS


SMARTER MONEY FUND 'A' RATING AFFIRMED
Friday, November 04, 2016


Melbourne, 4 November 2016 – Australia Ratings has affirmed its credit rating of ‘A’ to the units issued by the Smarter Money Fund, formerly the Smarter Money Active Cash Fund, (the Fund). The ‘A’ credit rating represents a high degree of creditworthiness on the rating scale used by Australia Ratings to assess the credit profile of a managed fund. The rating primarily reflects the credit quality of the Fund’s investments as well as the experience and skill of the investment manager, Smarter Money Investments.

Australia Ratings analyst Renee Corcoran said “the Smarter Money Fund has continued to pursue its investment objective through actively managing a liquid portfolio of fixed income securities that have a high degree of credit quality.” Ms. Corcoran also noted “investors in the Fund have a low exposure to volatility arising from changes in interest rates and the credit risk of the portfolio is restricted to investment grade securities.”

Smarter Money Fund (formerly the Smarter Money Active Cash Fund) was launched in February 2012 and aims to generate a return of 1.0% to 2.0% above the cash rate by investing in Australian dollar fixed income securities that carry minimal interest rate risk such as cash and floating-rate securities. During the past year to 30 September 2016, the Fund’s return was 3.8% after all fund fees to investors.

While the rating primarily reflects the credit quality of the assets of the Fund, Australia Ratings noted the stability of the investment team and the demonstrated track record of exceeding the investment objective of the Fund.

The units provide investors with a periodic distribution of income and a return of principal via a redemption request. Australia Ratings has also affirmed its Product Complexity Indicator of ‘BLUE” to the Fund’s units to indicate that an investment in the units represents a relatively straightforward type of fixed interest investment.

A full rating report is available from www.australiaratings.com.

For more information contact:
Chris Dalton, Managing Director
chris.dalton@australiaratings.com
03 8080 6684

Renee Corcoran, Director
renee.corcoran@australiaratings.com
03 8080 6684

SMARTER MONEY HIGHER INCOME FUND 'A-' RATING AFFIRMED
Friday, November 04, 2016


Melbourne, 4 November 2016 – Australia Ratings has affirmed its credit rating of ‘A-’ to the units issued by the Smarter Money Higher Income Fund. The ‘A-’ credit rating represents a high degree of creditworthiness on the rating scale used by Australia Ratings to assess a managed fund’s credit profile. The rating primarily reflects the credit quality of the Fund’s investments and the experience and skill of the investment manager, Smarter Money Investments.

Australia Ratings analyst Renee Corcoran said, “Investors in the Fund have low exposure to volatility arising from interest rates changes through a portfolio of fixed income securities with a high degree of credit quality.” Ms. Corcoran added, “The Fund’s credit risk exposure is actively managed with the majority of its assets in investment grade securities such as Australian denominated cash or cash equivalents and Australian denominated floating rate bonds, including RMBS, ABS and hybrid securities.”

The Smarter Money Higher Fund was launched in September 2014 and aims to generate a return of 1.5% to 3.0% p.a. above the RBA official cash rate. The Fund invests in Australian dollar fixed income securities that carry minimal interest rate risk such as cash and floating-rate securities. During the past year to 30 September 2016, the Fund’s return was 4.1% after all fund fees to investors.

While the rating primarily reflects the credit quality of the assets of the Fund, Australia Ratings noted the stability of the investment team and the demonstrated track record of exceeding the investment objective of the Fund.

The units provide investors with a periodic distribution of income and a return of principal via a redemption request. Australia Ratings has also affirmed its Product Complexity Indicator of ‘BLUE” to the Fund’s units to indicate that an investment in the units represents a relatively straightforward type of fixed interest investment.

A full rating report is available from www.australiaratings.com.

For more information contact:
Chris Dalton, Managing Director
chris.dalton@australiaratings.com
03 8080 6684

Renee Corcoran, Director
renee.corcoran@australiaratings.com
03 8080 6684

MASONS CREDIT FUND’S 'BBB' RATING AFFIRMED
Friday, October 14, 2016


Melbourne, 14 October 2016 – Australia Ratings has affirmed its credit rating of ‘BBB’ to Masons Stevens Credit Fund (“the Fund”).

A rating of ‘BBB’ represents that the Fund has a moderate level of protection against loss from credit risk on the rating scale used by Australia Ratings for fixed income funds. The rating primarily reflects the weighted average credit quality of the Fund’s assets and the experience and skill of the Fund’s Investment Management team, Mason Stevens Asset Management Limited.

Mason Stevens Credit Fund was launched in May 2013 and aims to generate a return of 3.5% above the Cash Rate by investing in securities that generate both income and yield. The Fund units provide investors with a quarterly distribution of income and a return of principal via a redemption request subject to redemption terms and conditions.

Australia Ratings analyst Renee Corcoran said “Investors in the Fund benefit from a diversified portfolio of debt securities with the current portfolio comprising investment grade assets.” Ms Corcoran added, “During the past year, the Fund’s foreign currency exposure remains relatively stable while the majority of the Fund’s assets are held in Australian dollars and across diversified asset classes including asset-backed, senior-unsecured bonds, and tier 1 hybrids, government and futures”.

Australia Ratings has also confirmed its Product Complexity Indicator of ‘YELLOW’ to the Fund indicating that an investment in the units represents a complex investment.

The YELLOW indicator highlights two important conditions. Firstly, the Fund’s documentation allows for using derivatives and borrowing in managing the Fund. Risk arising from the use of derivatives and borrowings will depend on the Investment Manager’s judgement. Secondly, if redemption sought is for over 20% of total units in any one month, the constitution of the Fund does permit redemptions to be spread over 3 months or in certain circumstances, redemption may be delayed to manage liquidity.

A full rating report is available from www.australiaratings.com/rating-reports.

For more information contact:

Renee Corcoran, Director, Australia Ratings
Phone: 03 8080 6684
Email: renee.corcoran@australiaratings.com

 

SEMINAR - UNDERSTANDING LISTED DEBT AND HYBRID SECURITIES IN MELBOURNE, 7 NOVEMBER
Thursday, October 06, 2016


Melbourne, 7 October 2016 – Australia Ratings is pleased to invite investors and those interested in the listed debt market to familiarise with some basic topics in investing in fixed income. Participants will be introduced to various fixed income debt securities available to help with investment portfolio diversification.

Designed to help self-directed investors, the 90 minute seminar will introduce investors to the types of listed debt securities and hybrids on the ASX and the role of credit ratings and complexity indicators in the investment market.

The seminar will take place on Monday 7 November at Collins Street Business Centre.

Register now to secure your spot.

If you have any further queries contact us by email: info@australiaratings.com or Tel: (03) 8080 6684.

 

ARTESIAN AUSTRALIAN CORPORATE BOND FUND ASSIGNED INDICATIVE ‘A-‘ CREDIT RATING
Tuesday, August 23, 2016


Melbourne, Tuesday, 23 August 2016– Australia Ratings has assigned an indicative ‘A- credit rating’ to the Artesian Australian Corporate Bond Fund (the Fund).

Australia Ratings also assigned its product complexity indicator of ‘BLUE’ to the Fund’s units, indicating that an investment in the Fund represents a relatively simple financial investment.

An investment in the Fund represents a purchase of units - Standard Units and Institutional Units - in a registered managed investment scheme. The Fund’s objective is to earn a return above the RBA Cash Rate by 1.75% to 2.75% (net of the ordinary costs of the Fund as apportioned to the two classes of units).

Australia Ratings’ credit analyst, Renee Corcoran said “the ‘A-’ rating of the Fund reflects the Fund’s strong degree of protection against loss from credit risk. The Fund’s assets are of a credit quality that supports its ability to meet redemption requests.” Ms Corcoran added “The “A-“ rating is an indicative rating based on an indicative portfolio and the rating will be confirmed after the actual Fund is launched.”

The credit rating reflects the following key strengths of Artesian Australian Corporate Bond Fund:

  • focuses on investment grade fixed and floating securities issued by Australian companies;
  • at least 90% of the funds not invested in cash are invested in investment grade securities rated BBB- or higher;
  • a conservative risk appetite focusing on large floating rate exposure to manage interest rate risk.

The credit rating also reflects the following key risks to the Artesian Australian Corporate Bond Fund:

  • future adverse credit market conditions could affect the unit value and credit quality
  • the assigned rating reflects analysis based on an indicative portfolio as the Fund has not yet been launched. If the actual launched portfolio differs materially in credit quality, the rating could change
  • limited track record as it is a newly established investment scheme
  • The ‘BLUE’ Product Complexity Indicator of the Fund’s units is confirmed. A BLUE designation indicates that an investment in the Fund represents a relatively simple financial investment on Australia Ratings’ five point Product Complexity Indicator scale.

    A full rating report is available from www.australiaratings.com/rating-reports.

     

    Contact:

    Renee Corcoran, Director, Australia Ratings
    Phone: 03 8080 6684
    Email: renee.corcoran@australiaratings.com


     

AUSTRALIA RATINGS LAUNCHES LISTED DEBT SECURITIES INDICES
Friday, June 03, 2016


Melbourne, 3 June 2016 – Australia Ratings is pleased to announce the launch of its family of indices that tracks the security price movements, distributions and returns of debt securities traded on the ASX: Australia Ratings Listed Debt Securities Indices.

Based on securities that are rated by Australia Ratings, the indices will provide investors and fund managers with a benchmarking tool for assessing portfolio performance.

The family of indices consists of individual indices following Australia Ratings’ Product Complexity Indicator (PCI) scale; and a composite index that includes all securities tracked in the individual indices. There are also sub-indices for securities that make franked and unfranked distributions.

Chris Dalton, Managing Director of Australia Ratings, said “The indices are the first benchmark of the performance of ASX listed debt and hybrid securities. This exciting initiative completes our credit ratings and product complexity indicators assigned to listed securities.”

The indices are accumulation indices with a start date of 1 January 2015 and track security price movements and distributions since that date.

Included in the indices are only those securities with a call or maturity date of more than twelve months and those with floating rate distributions. The pre-tax equivalent value of the distribution is used when distributions are franked, and each security is volume weighted.

It is expected that the Australia Ratings Listed Debt Securities Indices will become a valuable tool for investors and fund managers specialising in this part of the market to compare their investment performance against the individual indices and/or composite index.

The indices will be published on Australia Ratings’ website www.australiaratings.com at the start of each month based on market prices of the previous month end. Fund managers keen to use the indices for performance benchmarking should contact Australia Ratings.

Australia Ratings was appointed by ASX Limited, under the ASX Debt & Hybrid Research Scheme, to assign credit ratings to debt and hybrid securities traded on the ASX in late 2014. Australia Ratings has assigned credit ratings to most listed securities that consist of an assessment of the creditworthiness of the security issuer and an assessment of the complexity of the security. The rating assigned consists of both alphabetical and colour indicators. The alphabetical indicator follows the typical rating scale of ‘AAA’, ‘AA’, ‘A’, ’BBB’ etc.; while the colour indicator follows Australia Rating’s Product Complexity Indicator (PCI) scale of GREEN to RED.

For more information contact:

Chris Dalton, 0403 584 600, chris.dalton@australiaratings.com

SANDHURST STRATEGIC INCOME FUND’S ‘A’ RATING AFFIRMED
Tuesday, May 31, 2016


Melbourne, 31 May 2016 – Australia Ratings has affirmed its credit rating of ‘A’ to the Class A and Class B units issued by the Sandhurst Strategic Income Fund (“the Fund”).

A rating of ‘A’ represents that the Fund has a strong degree of protection against loss from credit risk on the rating scale used by Australia Ratings for fixed income funds. The rating primarily reflects the credit quality of the Fund’s investments and the experience and skill of the Fund’s Management team of Sandhurst Trustees Limited.

Australia Ratings analyst Renee Corcoran said “Investors in the Fund benefit from a highly diversified portfolio of term deposits and debt securities with low volatility risk due to short interest rate duration of the portfolio.” Ms Corcoran added “Over the last 12 months, the Fund reduced its exposure to term deposits and has invested a greater proportion of funds in corporate bonds and floating rate notes.”

Sandhurst Strategic Income Fund was launched in July 2011 and is part of the Bendigo Wealth division and a wholly-owned subsidiary of Bendigo and Adelaide Bank Group.

The units provide investors with a quarterly distribution of income and a return of principal via a redemption request. Australia Ratings has also confirmed its Product Complexity Indicator of ‘BLUE” to the Fund’s units to indicate that an investment in the units represents a relatively simple type of fixed interest investment. The BLUE indicator highlights that in certain exceptional circumstances the Fund may defer redemption requests to manage its liquidity.

A full rating report is available from www.australiaratings.com/rating-reports.

For more information contact:

Renee Corcoran, Director, Australia Ratings
Phone: 03 8080 6684
Email: renee.corcoran@australiaratings.com

AUSTRALIA RATINGS LAUNCHES NEW-LOOK WEBSITE
Wednesday, February 24, 2016


Melbourne, 24 February– Australia Ratings is pleased to announce the launch of our updated, new-look website – www.australiaratings.com.

The website brings a fresh and clearer presentation of our ratings and research and a menu layout that makes it easier to navigate the site. It will also allow easy access from mobile devices including smart phones and tablets.

Registered users of our current website will need to create a new login id and password to access ratings and research. We suggest you use your email address as your id. There is no restriction on the password format.

For further information contact us at info@australiaratings.com.

‘STRONG’ RANKING AFFIRMED FOR LA TROBE FINANCIAL ASSET MANAGEMENT LIMITED
Wednesday, February 24, 2016


Melbourne, 24 February – Australia Ratings has affirmed its ranking for La Trobe Financial Asset Management (LFAM) as ‘Strong’.

A ‘Strong’ Operational Capability Assessment (OCA) ranking reflects the embedded processes and procedures adopted by LFAM to successfully perform its operational role and successfully execute La Trobe Australian Credit Fund’s investment mandates and deliver expected income to investors.

Australia Ratings analyst, Daniela Crisafi said “Sound governance, compliance and risk management frameworks give LFAM direction and support to successfully fulfil its role and to provide expected returns to Fund investors. Such frameworks have been embedded in their processes, supporting LFAM’s role. Furthermore, experienced employees’ focused and consistent approach in managing the Fund firmly supports LFAM.”

LFAM’sStrong OCA indicates continued demonstration of a strong capacity to perform its obligations and role as Responsible Entity for the La Trobe Australian Credit fund. LFAM is supported by very strong capabilities and qualities.

LFAM’s ‘Strong’ ranking also takes into consideration the operational and financial support from the La Trobe Financial Group. On a consolidated basis, the Group held net assets of more than $101 million as at 31 January 2016.

Download copy of the full Operational Capability Assessment ranking report.

 

For further information contact:

Daniela Crisafi,  Director,  Australia Ratings
Phone: 03 8080 6684
Email: daniela.crisafi@australiaratings.com

 

RATING OF HERITAGE BANK RETAIL BONDS REVIEWED AND AFFIRMED AT ‘BBB+’
Monday, December 07, 2015


Melbourne, Monday 7 December 2015 – Australia Ratings has reviewed and affirmed its credit rating of ‘BBB+’ of the Heritage Bank Retail Bonds (the Bonds). This rating is the highest long-term rating in the intermediate category of creditworthiness on the rating scale of Australia Ratings (see the rating scale below). The Bonds are senior and unsecured debt obligations of Heritage Bank Limited.

Australia Ratings also confirmed its product complexity indicator of ‘GREEN’ on the Bonds, indicating that Australia Ratings considers the Bonds to be a debt investment with simple and straight forward terms and conditions. A coupon of 7.25% p.a. is payable quarterly in arrears until maturity of the Bonds in June 2017.

Australia Ratings’ credit analyst, Chris Dalton said “the ‘BBB+’ rating of the Bonds reflects the credit quality of Heritage Bank”. Mr Dalton added “earnings and profitability dipped slightly in FY2015 reflecting competition in the markets for term deposits and residential mortgages. Heritage’s performance in keeping down arrears remains significantly better than the industry average, with only 0.39% of loans in arrears as at 30 June 2015. Heritage continues to execute a consistent business strategy and based on the current economic outlook and the business and financial risk profile of Heritage, the rating is expected to remain unchanged in the medium term”.

The credit rating reflects the following key strengths of Heritage Bank’s business:

  • a low risk portfolio of residential mortgages with below industry average arrears and losses;
  • a conservative risk appetite with regard to maintaining capital and liquidity above regulatory capital requirements; and
  • a diversified funding base with experience in raising funds via both wholesale and retail funding markets.

The credit rating also reflects the following key risks to Heritage Bank’s business:

  • a slowing of demand and increased competition in the residential mortgage market which may constrain earnings growth; and
  • a reliance upon retained earnings to build capital base for future asset growth.

The ‘GREEN’ Product Complexity Indicator of Bonds is confirmed. A GREEN designation indicates the terms and conditions of the Bonds are simple and straightforward with a very low level of complexity on Australia Ratings’ five point Product Complexity Indicator scale.

For more information contact:

Chris Dalton, 0403 584 600, chris.dalton@australiaratings.com


 

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