In late July, Rob Nicholls, the chief of the AOFM gave a speech regarding the divestment of the Residential Mortgage Backed Securities (RMBS) acquired after the GFC. In the speech he said the AOFM would sell the securities in an orderly fashion and without resorting to a “fire sale” but the latest auction would suggest an orderly sales process has become somewhat problematic.
The AOFM has nearly $3.5bn of RMBS on its books and $366m worth of securities were offered for sale. Bids for $102m were made but no bids were accepted. In a previous YieldReport article it was suggested the AOFM was seen as a disciplined seller but Westpac described the result as “disappointing” and noted the value of bids for each auction has been declining. The next auction is on 23 November 2015.
