Pepper Money Limited has entered into a binding agreement to acquire the approximately NZ$1.4 billion New Zealand prime residential mortgage portfolio of The Hongkong and Shanghai Banking Corporation Limited, New Zealand Branch (HSBC).
This agreement followed HSBC’s June announcement that it was winding down its New Zealand Wealth and Personal Banking business. The sale of a domestic loan portfolio of this size, in the context of a market exit, makes it a significant deal in the New Zealand mortgage loan market.
The transaction will be funded using a combination of senior and mezzanine funding.
The Chapman Tripp team was led by corporate partner Alex Franks and finance partner Luke Ford, alongside partners Bevan Miles and Kelly McFadzien. Emma Bowman, Tom van Schaik, Conor Tinker and Grayson Hardy also provided support.
Chapman Tripp also advised Pepper Money on the establishment of its New Zealand securitisation programme in 2019.
Alex Franks said, “We are pleased to support Pepper Money as they take the next step in their growth strategy.”
The transaction is anticipated to complete in late November 2023 and is subject to approval of the New Zealand Overseas Investment Office.
King & Wood Mallesons also acted for Pepper Money on the financing of the transaction. HSBC was represented by Norton Rose Fulbright and Bell Gully.
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