Macquarie Bank has set up a A$5bn (Eu3.17bn, US$3.56bn) covered bond programme, giving the Australian bank the option to use the instrument alongside RMBS, in which it has an established presence, although the size of the new programme is relatively modest.

The prospectus for the covered bond programme, dated 15 June, dubs it the MBL Covered Bond Programme, with Perpetual Ltd guaranteeing issuance as trustee of MBL Covered Bond Trust. Barclays and HSBC are listed as arrangers.

Issuance is expected to be rated Aaa/AAA by Moody’s and Fitch, according to the prospectus. Macquarie Bank Limited (MBL) is rated A2/A/A by Moody’s, Standard & Poor’s and Fitch.

Macquarie Bank could not be reached for comment by the time The CBR went to press.

The Australian issuer is a regular participant in the securitisation market, notably through its PUMA residential mortgage-backed securities (RMBS) programme and most recently through A$1.5bn PUMA Series 2015-3 in August.

Macquarie had a mortgage portfolio of A$24.5bn as at 31 March.

It joins Australia’s big four banks in having a covered bond programme as well as Suncorp-Metway, which has only been active in the domestic market.