Background Over the decade leading up to the financial crisis, securitisation was a rapidly growing segment of the financial sector globally and in Australia. This is demonstrated in the share of housing lending in Australia financed through securitisation, which rose from less than 5 per cent in the mid 1990s to over 20 per cent in 2008 (Graph 1).
While residential mortgage-backed securities (RMBS) accounted for the bulk of securitisation activity, growth in other parts of the industry, including the securitisation of commercial property, auto and equipment loans also grew faster than aggregate lending in these market segments. A range of factors on both the demand and supply side underpinned the rapid growth in securitisation.