Judo Capital Holdings (ASX:JDO) priced a AU$750 million capital-relief securitization transaction that will boost the company's common equity Tier 1 ratio, according to a Friday filing with the Australian bourse.
The transaction, backed by small and medium-sized enterprise business loans, received strong investor support, allowing the company to upsize it from an initial amount of AU$500 million.
As a result of the transaction, Judo Capital said its pro forma CET1 ratio at March 31 was 13.2%, compared with a reported ratio of 12.6%.
After the transaction, which is expected to settle on June 4, Judo will generate a "significant" net interest margin on the underlying business loans without needing to hold capital for those assets, it said. Assuming a normalized level of capital, the transaction is expected to deliver a pro-forma benefit of 25 to 30 basis points to the fiscal year 2027 return on equity.