The machinery of securitisation may be grinding back into gear, with Macquarie Bank the latest to market a pool of mortgage-backed securities. The bank is selling $500 million in bonds through Puma Masterfund P-16 Series A.The planned bond is the first from Macquarie in two years, and serves as a reminder of the recovery of a market segment badly knocked by the credit crunch. Macquarie, through Puma, was a busy issuer of mortgage-backed securities and funding loans originated by a wide network of mortgage managers.Macquarie went close to leaving the mortgage market altogether. The bank is funding loans once again, though on a more restrained basis than before.As with all recent issues of mortgage-backed securities, this Puma bond has the support of the Australian Office of Financial Management.Still, additional investment demand is around for the current wave of RMBS deals that emerged six weeks ago.AOFM bought $500 million out of $1.6 billion in securities sold by Bank of Queensland this week. AOFM also bought $100 million out of $200 million in bonds sold by Liberty; $170 million out of $250 million sold by MyState; $500 million out of $1.5 billion sold by Bendigo and Adelaide Bank and $250 million out of out $1.2 billion sold by ME Bank in early July.The fresh funding flow is beginning to show up in product design and pricing.Mortgage managers funded by Adelaide Bank from next week will have access once again to a home loan with a maximum loan to valuation ratio of 95 per cent. The bank will also capitalise the mortgage insurance.Loans of 95 per cent LVRs, while available from other lenders, tend to be restricted to current bank customers.This new loan will be available to owner occupiers and targeted at first home buyers. The bank will not lend at elevated LVRs to investors.A degree of loan discounting is also showing up around the market. HSBC earlier this week promoted an introductory rate on one loan package of 5.69 per cent for 12 months (with a comparison rate of 6.54 per cent), a discount of 1.65 percentage points to its notional rate. The bank also pledged an ongoing discount of up to 0.75 percentage points over the life of the loan.