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Commonwealth Bank Launches Sixth Global Australian Mortgage Securitisation

19 March 2004

The Commonwealth Bank has launched its sixth global issuance of AUD3.4 billion mortgaged backed securities through Medallion Trust; its Mortgage Backed Securities (MBS) programme.

The assets comprise fixed and variable rate loans originated from the Bank’s home loan portfolio and from the portfolio of Homepath Pty Limited, a wholly owned subsidiary.

The deal is structured to include issuance of securities in three currencies and were priced as follows:

Class A-1 of US$1,300 million - US 3m LIBOR + 13;

Class A-2 of AUD810 million 3m BBSW +22; and

Class A-3 of Euro500 million 3m Euribor +14.

Class A-1 and A-3 securities are issued into the US and Euro markets under the SEC shelf programme, whilst Class A-2 are issued into the domestic market. The Class A Notes have an average life of 2.7 years. There is also A$53 million of Class B subordinated notes.

This deal brings the total issuance to date under the Medallion global programme to nearly A$15 bn. Marten Touw, the Group Treasurer at Commonwealth Bank, said "the deal received a very strong response from offshore and domestic investors; including Asian investors, who recognise the quality of the Medallion programme. We are very pleased with the pricing levels achieved in this transaction."

The transaction was joint-lead managed by Commonwealth Bank, Citigroup, Deutsche Bank Securities and Nomura International. Co-manager for the offshore issue is Credit Suisse First Boston,