# Quarterly SFSF Update | April 2021

This note provides an update on the AOFM’s Structured Finance Support Fund (SFSF) activities as at 31 March 2021. As at this date, total funds committed by the SFSF were $3.8 billion. There are three main work streams for the provision of SFSF support: (1) public (primary and secondary) markets; (2) private (warehouse) markets; and (3) forbearance (the establishment of arrangements to assist small lenders to provide forbearance for borrowers experiencing Covid-19 related hardship). Public Markets Public securitisation market conditions continued to improve through the quarter, reducing the need for SFSF support for primary and secondary markets. No requests for support were received by the AOFM in public transactions during the quarter. Cumulative public market investments made since the SFSF’s inception stood at around$1.36 billion as at 31 March 2021.

Private markets

The AOFM did not receive any expressions of interest for the SFSF to invest in private warehouse facilities throughout the quarter. One limit increase was approved by the delegate during the period. As at 31 March 2021, SFSF commitments of circa $2.3 billion have supported 45 individual warehouses sponsored by 34 eligible lenders. The total capacity of warehouses for which support has been committed since the SFSF’s inception is circa$17.9 billion.

Noting the prior observations made with regards to the improvement in primary market conditions, during the last quarter there has been an increase in the number of issuers expressing an interest in replacing the AOFM’s positions with private sector commitments. As at 31 March, the AOFM had been replaced by other investors in two instances and the AOFM remains in active discussions with other originators over the replacement of the AOFM in warehouse investments.

Forbearance SPV

On the 31st March, the Forbearance SPV availability period ceased. Total draws on the fSPV stood at $47 million, well inside the approved limits for the fSPV of$101.6 million. Drawdowns under the fSPV have been substantially lower than expected due to the rapid improvement in Covid-19 Hardship portfolios through the March quarter.  Repayments of support drawn under the fSPV are scheduled to begin in April, though it is noted that some originators in the fSPV program have already commenced the repayment of principal and interest ahead of their original schedule.