Selling the golden mix: surety, clarity and returns

Rated Mortgage Bonds are a secure, mortgage back security investment that has weathered the financial storm.

We were approached by one of the Directors of Property Finance Securities, Leigh Davis. He was looking for a creative partner that was on his philosophical wavelength. Leigh was an incredible talent, both in business and in the arts. He was a celebrated poet and artist and an incredible academic. Sadly he passed in 2009.

He wanted a partner that could help him launch a complex financial product to the market, illustrate its benefits and give people clarity around its risk profile. We spent an invigorating two days ensconced in his holiday home up in Whale Bay in Northland to crack the naming and product proposition.

We had to go into fast-track to create branding and a launch mechanism for the product, followed hot on the heels by prospectus and offer documentation.

The product needed to be explained to what amounts to fairly naïve investors; not much was known about mortgage backed securities. It’s risk profile was good, rated between B and AAA by Fitch at the time. We had to find a mechanism that made it all seem easy. Human hands were a great device. They suggested the real people behind the investments, quality Ma and Pa mortgage-holders. They were also a great way to communicate product attributes and benefits.

The first offer was fully subscribed, and a second. They were on their way to becoming THE new product in the New Zealand investment market just prior to the worldwide financial collapse.