Bonds with choice of assets

NZAX-listed propertyfinance group has launched a new bond programme which it says will help address a significant need for investors wanting interest-bearing investments.

Friday, 24 November 2006

Who is the company behind it?
They are being promoted by Christchurch-based, NZAX listed company Propertyfinance Group Limited.

Who is the target market?
Investors looking for an investment grade, listed interest bearing investment.

What return does it offer?
There are two types of bonds, one with commercial property backing and the other with residential mortgage back. The rates are set quarterly and the opening rates are 8.97% and 9.02% for the residential and commercial bonds respectively,

When was it launched?
November 20.

What other products is it like or is it competing with?
The bonds are up against finance company debentures , and other secured bonds listed on the NZDX.

Is it long term, short term or medium term?
Because of the way the bonds are structured it would suit medium term investors.

What is the unique selling point?
The first offering of these bonds are expected to have a BBB rating from international agency Fitch (an alternative to Moody's and Standard and Poor's). In the future investors will have a choice between different levels of returns, based on AAA, AA, A or BBB rated bonds. Other pluses are that investors can choose whether they want exposure to residential or commercial property loans with the latter offering slightly higher rates.

How strong a stomach do you need for it?
These bonds have an investment grade rating and are tradable which gives investors a good degree of comfort.

What's the hitch?
The biggest issue investors need to get their mind around is a call option which kicks in after five years when the company intends buying back the notes.

Comments from our readers

No comments yet

Add your comment:

Your name:
Your email:	Not displayed to the public
Comment:
Comments to Deposit Rates go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Anti-spam verification:

Type the text you see in the image into the field below. You are asked to do this in order to verify that this enquiry is not being performed by an automated process.