The Reserve Bank has made two amendments to its eligibility criteria for securities accepted for use in
its domestic market operations.
Exemption from BBSW Fallback language requirement for Refinancing Notes
Refinancing notes issued on or after 1 December 2022 are now exempt from the BBSW
fallback language requirement in the RBAs eligibility criteria, if the refinancing notes are used
to repay existing notes first issued before 1 December 2022 from marketed closed-pool asset-backed
security (ABS) trusts.
This exemption has been granted in recognition that refinancing notes without BBSW fallback language that
meet the RBAs relevant eligibility criterion are a relatively small and diminishing share of the
market, no new assets are being financed by refinancing notes, and an exemption for refinancing notes is
in line with our treatment of other grandfathered securities. The exemption also recognises that some
issuers could incur material costs to insert compliant BBSW fallback language into the transaction
documents of marketed ABS that were first issued before 1 December 2022.
Nevertheless, as a matter of prudent risk management, the RBA strongly encourages the insertion of BBSW
fallback language that complies with the RBAs relevant eligibility criterion into transaction
documents for refinancing notes that would qualify for this exemption.
Extension of minimum notice period for asset-backed security legal document changes to
20 business days (up from 10 business days)
The minimum notice period for events that include amendments to asset-backed security legal documents has
been extended to 20 business days (up from 10 business days).
This minimum notice period applies to transaction document changes requiring RBA consent, RBA
non-objection, and no action from the RBA.
Applications are not considered complete until all relevant documents have been submitted to the RBA.
Failure to meet this notification requirement may delay the intended execution date of proposed changes
and can affect repo eligibility.
For further information please contact the Eligible Securities Team at eligible_securities@rba.gov.au.
Risk & Compliance Department
Reserve Bank of Australia
5 July 2023