UPDATE 1-Australia's RAMS says extends funding facilities
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SYDNEY, Dec 28 (Reuters) - RAMS Home Loans Group Ltd (RHG.AX), Australia's first high profile victim of the subprime mortgage crisis, said it had extended two funding facilities worth A$750 million ($658 million) that had been due to expire on Dec. 31.
RAMS is trying to refinance its debt after it failed to roll over A$6.17 billion of paper in August, when credit markets suddenly dried up and cut off its main funding source. The group said in a statement on Friday that a A$500 million facility had been extended to May 2, 2008, and a A$250 million facility had been extended to Jan. 31. Both facilities are fully drawn.
Shares in RAMS rebounded from a negative start to gain as much as 8.3 percent on the comments. RAMS was up 3.3 percent at A$0.31 by 0026 GMT, but has plunged from an initial public offer issue price of A$2.50 in July.
The mortgage lender is also seeking to refinance a A$5.5 billion loan book funded from U.S. extendible commercial paper (XCP) markets that were hit hard by the subprime mortgage crisis.
RAMS said it hopes to start refinancing the loans in January.
Like other non-bank lenders, RAMS borrowed money in the short-term commercial paper market and lent it to home buyers for a longer duration. It ran into trouble when that short-term funding dried up.
RAMS agreed in October to sell its brand and distribution business to Australia's Westpac Banking Corp (WBC.AX) for A$140 million. RAMS retained its existing mortgage book in the deal.
Shopping mall operator Centro Properties Group (CNP.AX) became Australia's second high-profile victim of the global credit crunch when it revealed similar refinancing troubles earlier in the month, forcing it to restructure. ($1=A$1.14) (Reporting by Cecile Lefort; Editing by James Thornhill)
