Confusion over its association with high yield mortgage
funds has caused LM Investment Management (LM) to change the
name of its mortgage trust.
The LM Mortgage Income Fund will be re-named the LM First
Mortgage Income Fund in order to clarify the trust as a
registered first mortgage only vehicle.
“This simple change should differentiate the conventional
assets of our fund from those of the mixed asset funds
included within the industry labelled high yield mortgage fund
sector,” said LM chief executive Peter Drake.
LM provides registered first mortgage funding on
residential, commercial, industrial, retail and
pre-development land around Australia.
In June Standard & Poor’s downgraded LM’s mortgage
income fund from three stars to two on concerns that loan
arrears for the fund had grown to 16.6 per cent rather than
the 1 per cent at the fund's initial rating in February.
LM today reported the latest figures on loan arrears
stood at just under 5 per cent.
LM currently has $1 billion in funds under management and
has loaned around $2.5 billion nationally in the last eight
years.
