19th March 2008

Dear Investor,

In June 2007, we issued an Investment News entitled "Know who you are investing with". In that issue we highlighted the difference between La Trobe and a number of debenture companies that had experienced difficulties and sustained losses.

We noted in that Investment News that La Trobe does not permit lending to related entities, or to directors or staff. We highlighted La Trobe's tightly managed approach to construction and development projects, with the percentage of the Fund exposed to property developments currently standing at 16.34%. We noted that the average loan-to-valuation ratio for the Fund rarely exceeds 66%, with the average currently standing at 59.65%. Finally, we reminded investors about La Trobe's track record of over 50 years' successful operations.

So, in March 2008, with the global economic and financial environment in turmoil, interest rates rising, and a number of Australian financial institutions such as MFS, Centro, City Pacific and Allco in trouble, we thought that we should again reiterate for investors the conservative differences and attributes of the Fund's investment profile and the key strengths of La Trobe as the Responsible Entity of the Fund:

  • La Trobe specialises in making loans secured by registered mortgages over Australian properties; it's all we do, and it's where our expertise lies. We have been lending for over 50 years, and we've successfully negotiated the ups and downs of the markets over that time. We do not manage any other type of assets.
  • The La Trobe Australian Mortgage Fund is exactly that - a mortgage fund. It is not a property fund, and does not invest in property. The Fund lends money on the security of Australian property and, as noted above, the average amount lent by the Fund by way of mortgage is only 60% of the independently assessed property value.
  • The Fund has no borrowings whatsoever and in the underlying investments we are almost invariably the first mortgagee on title.
  • The Fund invests in a portfolio of mortgages broadly diversified by geography, security type, loan purpose and loan size, the latter currently averaging $259,778. Construction and development currently represents only 16.34% of Fund's investments. The Fund only lends to a limited number of select construction and development projects at a time and we don't undertake any construction developments ourselves.
  • La Trobe does not have any relationships with property trusts, either listed or unlisted, and we don't lend to property trusts.
  • The La Trobe Group is not listed on any Stock Exchange - so the Group is unaffected by the day-to-day turbulence of the stock markets, and we are not exposed to margins loans, which many investors will have read about.
  • Neither La Trobe nor the Fund has any credit exposure to the US sub-prime mortgage markets.
  • The Fund was established by La Trobe in 1999 and is registered with the Australian Securities & Investments Commission ("ASIC") as a managed investment scheme.
  • La Trobe Financial Asset Management Limited, the responsible entity of the Fund, holds Australian Financial Services Licence No. 222213.
  • The Pooled Mortgages Option of the Fund has been independently rated by PIR and S & P, and both research houses will be undertaking update reviews over the next few months.

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.