04 March 2011

Dear Investor,


The Second World War was a merciless teacher. Papua New Guinea and the Kokoda Trail produced men who knew the value of order and fellowship and how it could save lives. One such man was the founder of La Trobe Financial, Ray O'Neill. He figured that if rigor, discipline and sense of comradeship were so valuable in the fluid situation of war then they could equally be applied to business.

Apply them he did. Sixty years ago he established the values that this week earned La Trobe the most Innovative Fund award at the Melbourne Financial Services Symposium (MFSS). Not a first for La Trobe Financial either - over the last two years it has been lauded by Money magazine as the "Best of The Best" in 2010 and 2011 for its Mortgage Fund.

La Trobe Financial's current CEO Greg O'Neill (the founder's son) said "These 'innovative' values - the sanctity of the client's money, conservatism in investment, and thoroughly understanding the business we are in contributed to the 'overnight' success that took sixty years. All our Investors - Wholesale Institutions, banks and individuals, have benefited."

The MFSS Award Chairman of the expert judging panel, Mr John Gall, made special mention of La Trobe Financial's outstanding performance throughout the recent Global Financial Crisis. Unlike many other companies, La Trobe Financial has continued through this period to pay outstanding returns to its investors and never refused or delayed a redemption request.

The innovations highlighted by the judging panel of the Awards in the La Trobe Australian Mortgage Fund were as follows:

  1. Dedicated Income Reserve which ensures that investors received reliable monthly income by smoothing income distributions and providing significant protection from capital losses. Because of the Reserve, there has been not a single cent lost of investor capital in the Pooled Mortgages Option ("PMO") since its inception in 2002.

  2. Co-investment which dramatically improves the diversification of the Fund by allowing the PMO to co-invest in mortgages with other funders. As a consequence, the PMO's average investment in any single loan is an industry low of around $200,000. This massively reduces the risk profile of the PMO for its investors.

  3. Term investment structure which provides a closer match between the assets and liabilities of the PMO and is the most fundamentally sound structure for any mortgage fund. The targeted term structure of the PMO is a key reason that it has never had to freeze, restrict or delay redemptions at any time in its history2.

Regular readers of Investment News will be aware that the PMO has also:

  • recently had its independent rating by Adviser Edge increased to 3.75 stars (from 3.5 stars), which is the highest rating for any mortgage fund in Australia4; and

  • retained its top ranking by Morningstar for returns by any mortgage fund over 1, 3, 5 and 7 years3.

Call our friendly Investor Liaison team on 1800 818 818 to see how the Pooled Mortgages Option can benefit you.

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.