Ashley Burtenshaw
Gryphon Capital Income Trust (GCI or Fund) has commenced trading on the ASX, under the code GCI. This follows a successful and comprehensive roadshow process which raised $175.3m.
Ashley Burtenshaw, co-founder and Chief Investment Officer of GCI, said “The ability to achieve diversification within a fixed income portfolio and receive a monthly income stream resonated strongly with investors.
“This type of exposure plays an important defensive role in a portfolio, as it is not correlated to traditional asset classes such as equities.
The Listed Investment Trust provides a unique opportunity for investors to access a portfolio of Residential Mortgage Backed Securities (RMBS) and Asset Backed Securities (ABS) in an ASX listed vehicle managed by a specialist fixed income asset manager that manages $1.7bn on behalf of institutional investors.
RMBS and ABS have a number of important structural protections that mitigate the risk of bondholders taking a principal loss. These credit enhancements include borrower’s equity, lenders mortgage insurance, originators excess interest and originators first loss.
Every proposed RMBS investment is stress tested to withstand the APRA stress scenarios that are used by Lenders Mortgage Insurers in calculating Probable Maximum Loss which corresponds to a 1 in 200 year event, prior to consideration for the portfolio.
Morgans and NAB were Joint Arrangers and Lead Managers to the transaction.
Chris Donohoe, Partner at Seed Partnerships, advisors to GCI said: “We are really pleased to be able to bring a listed investment trust to investors that offers exposure to an alternative fixed income strategy. The quality of the investment managers, the robustness of their processes and track record, made this a very compelling offer and contributed to this excellent result.”