15th April 2009

Dear Investor,

More positive signs

At La Trobe, we believe that even though times are still tough, it is important to keep an eye out for the positive indicators that Australia is well-placed to cope with the inevitable challenges that lie ahead. Here are 2 more positive signs that should give us confidence about the future.

Aussie banks amongst the world's safest

Australia's banks are amongst the safest in the world. Analysis conducted by US publication Global Finance, which ranks the top 50 safest banks based on their credit ratings, places all four of Australia's major banks in the top 20. At number 11, National Australia Bank was the highest ranked Australian bank, followed by CBA (12), ANZ (15) and Westpac (16). New Zealand's ASB Bank, which is owned by CBA, followed closely, at number 18.

The list was dominated by the European Supra Sovereign and Agency (SSA) sector, with German bank KfW topping the list, ahead of CDC of France, BNG of the Netherlands, Rentenbank of Germany and Rabobank of Netherlands. Only four US banks were placed in the top 50: Wells Fargo (21), US Bancorp (26), BNY Mellon (35) and JPMorgan (47). Canada fared better with five banks placing in the top 50. RBC was the highest placed at 10, followed by TD at 14. The top UK bank was 19th-placed HSBC. Other notables were BNP Paribas (8), Banco Santander (9), Deutsche Bank (30), Société Générale (31), Barclays (45) and UBS (46).

Global Finance has produced the list for 17 years, and bases its rankings on a combination of long term credit ratings (supplied by S&P, Fitch and Moody's) and total assets of the world's 500 largest banks.

Mortgage Arrears – Australia very well placed internationally

Recent interest rate cuts from the Reserve Bank of Australia will help improve serviceability and may improve arrears if unemployment remains contained. As a whole, underlying residential loans continue to perform very well. Arrears are rising but off a very low base and from an international standpoint, Australian collateral is performing very favourably versus offshore peers. Over the third quarter of 2008, the level of arrears from some of our most comparable offshore counterparts showed significant increases. As can be seen in the chart below, Spain, Portugal and the United States were the worst performers with 30+ day arrears increasing significantly to 5.1%, 4.0% and 4.3%% respectively. Italy, Germany and the UK also showed further signs of deterioration pushing up towards the 3% level. Despite the recent slight rise, Australia continues to track favourably, joined at the lower end of the arrears spectrum by the Dutch.


So, while no one can predict the future, the foundations of the Australian financial system are holding and there is reason to be confident about the future.

Best regards,
Chris Andrews


> Home
> About Us
> PDS - Want to invest?
> FAQs
> Subscribe Free
> Independent Ratings
> Mortgage Shopping List

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.