19th September 2007

Dear Investor,

Does Size Really Matter?

According to independent research specialist on property related assets, Property Investment Research Pty Ltd (“PIR”), our mortgage Fund is currently Australia’s 13th largest Mortgage Fund. In terms of our Select Mortgages Investment Option, we offer the largest select or “contributory” mortgage option in Australia – that is where an investor chooses the underlying mortgage to invest in.

Specific benefits to investors

  • Experienced Investment Manager – specific to the mortgage industry – we focus exclusively on mortgages and have a track record back to 1952;
  • The Investment Manager originated over $2.06billion of mortgage loan enquiries in 2007 (2006: $2.7billion) giving strong deal flow to the Fund;
  • Competitive risk-reward returns with investor choice of four (4) Investment Options;
  • Independently rated;
  • Monthly income deposited directly into the investor’s bank account;
  • A diversified portfolio of mortgages over Australian real property;
  • All properties independently valued;
  • Group Funds under management over $1.4 billion;
  • One of Australia’s largest mortgage funds;
  • Real property mortgage security;
  • Capital stable investment in mortgages with all securities independently valued and actively managed;
  • No investment entry fees;
  • No exit fees, on maturity of the investment;
  • Minimum investment of $1,000;
  • Flexibility for the investor to manage his or her investments to meet his or her own needs and risk profile;
  • Conservative average loan to valuation ratio 59.87% (as at 31 August, 2007); and
  • No foreign exchange exposure risks.
  • Minimum investment $1,000
  • Minimum investment term for the Pooled Mortgages Option - 12 months
  • Investment term for the Select and Special Situation Options – Loan terms range from 12 months to 5 years.
History of the company

La Trobe commenced operations in 1952, and has grown steadily and consistently since then. The company remains privately owned and highly focused, employing over 130 finance professionals. We have authorised representatives in each state of Australia, and total mortgage loans exceeding $1.4 billion spread across Australia.

La Trobe has managed and maintained a significant number of Institutional mortgage funding investment mandates since inception, and has lent more than $9.3 billion to over 96,000 customers cumulatively. In 1990 we decided to diversify our funding base from purely institutional mandates to include retail investments. We embraced new financing and investment structures, including our managed investment scheme, the La Trobe Australian Mortgage Fund, which now serves over 3,500 active members and some $400m in funds under management invested by the retail public.

How we rank our fund compared to others in the sector

La Trobe’s Fund compares favourably to others in the same space on a host of measures:

  1. Our rate of return for just one of our investment options, the Pooled Mortgages Option at 7.50% p.a.* is higher than the average of top 7 major mortgage funds operating in Australia who offer a 5.81% pa average return for their equivalent investment;
  2. Sector and geographical diversification of the Fund is strong with limited exposure to high risk development projects, (less than 11% as at Aug 07), and the Fund has a high bias towards lower risk residential houses;
  3. The Investment Manager has a strong ability to source continuous credit quality loan applications (strong deal flow) for the Fund with over $2.06 billion sourced this year;
  4. Strong track record of staff and key personnel, with over 130 full time staff;
  5. An Indirect Cost Ration (ICR) of 1.35% just slightly higher than the industry benchmark of 1.3%;
  6. Cash-to-mortgage ratio of 6.28%:93.72% as at Aug 07 (other funds have under-deployed cash assets diluting their investor's monthly returns)

Best regards,
Chris Andrews


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Chris Andrews
Head of Funds Management

t  +61 3 8610 2811
e  candrews@latrobefinancial.com.au

Chris Andrews is the Head of Funds Management for the La Trobe Group and has responsibility for the La Trobe Australian Mortgage Fund.
Read full profile here.

La Trobe is one of Australia's leading independent specialist mortgage Financiers. Its business includes residential mortgages, commercial mortgages, and investment services operating one of Australia's largest Mortgage Funds under AFSL 222213. It employs over 115 staff and has raised over AUD$10Billion to assist over 100,000 customers since inception in 1952.

Copyright 2010 La Trobe Financial. All rights reserved. No portion of this may be reproduced, copied, or in any way reused without written permission from La Trobe Financial. Disclaimer

* La Trobe Financial Asset Management Limited ABN: 27 007 332 363 and AFSL No: 222213 is the issuer and manager of the La Trobe Australian Mortgage Fund. It is important for you to read the Product Disclosure Statement for the Fund before you make any investment decision. You can get a copy of the PDS by calling 1800 818 818. You should consider carefully whether or not investing in the Fund is appropriate for you.
(1) The rates of return from the Fund are not guaranteed and are determined by future revenue of the Fund, and may achieve lower than expected returns. Past performance is no guarantee of future performance. Investors risk losing some or all of their principal investment.
(2) Withdrawal rights are subject to liquidity and may be delayed or suspended.
(3) As at 30/11/10 the La Trobe Australian Mortgage Fund had received a Morningstar RatingTM of 5 stars. The Morningstar Rating is an assessment of a fund's past performance - based on both return and risk - which shows how similar investments compare with their competitors. A high rating alone is insufficient basis for an investment decision. © 2010 Morningstar, Inc. All rights reserved. Neither Morningstar, nor its affiliates nor their content providers guarantee the above data or content to be accurate, complete or timely nor will they have any liability for its use or distribution. Any general advice has been prepared by Morningstar Australasia Pty Ltd ABN: 95 090 665 544, AFSL: 240892 (a subsidiary of Morningstar, Inc.), without reference to your objectives, financial situation or needs. You should consider the advice in light of these matters and, if applicable, the relevant product disclosure statement, before making any decision. Please refer to our Financial Services Guide (FSG) for more information at www.morningstar.com.au/fsg.pdf
(4) 3.75 star rating out of a possible 5 star rating indicates that Adviser Edge believes that La Trobe has performed in line with its peers and exceeded its peers on some fronts.
(5) The Standard and Poors rating of 4 out of 5 stars indicates that S + P has high conviction that La Trobe Financial will consistently generate risk-adjusted fund returns in excess of its relevant investment objectives and relative to its peers.
(6) The award was given to the La Trobe Australian Mortgage Fund, Pooled Mortgages Option.
Research Ratings are subject to change. To view the latest research information please visit www.adviseredge.com.au or www.standardandpoors.com.au. Ratings issued by Adviser Edge Investment Research AFS Licence No. 236783 and Standard & Poors Information Services (Australia) Pty Ltd AFS Licence No. 258896 are solely statements of opinion and not statements of fact or recommendations to purchase, hold, or sell any securities or make any other investment decisions. The ratings are only one factor to be taken into account in deciding to invest. Research Houses receive a fee from La Trobe for rating the product. The Adviser Edge rating is generally a measure of the rated entity's capacity to meet its repayment obligations in all market circumstances.
IMPORTANT: This message, together with the La Trobe Financial website (www.latrobefinancial.com.au) and all its contents have been prepared for general information only and should not be taken as legal or financial advice, and as such the specific needs, investment objectives or financial situation of any particular user have not been taken into consideration. Individuals should therefore talk with their financial planner or advisor before acting on any information present on this message or the La Trobe website.