In a panel session on master trusts held at yesterday's Australian Securitisation annual conference, the previous day's keynote presentation, by Charles Littrell, the Australian Prudential Regulation Authority's executive general manager of policy, research and statistics, on prudential reform was reviewed by issuers and their advisers.Sofie Sullivan, the executive director of the securitised products group in JP Morgan's Australian office, moderated the session and was decidedly bullish over some of the proposals from APRA. "Yesterday was an absolutely great day for securitisation. APRA has given us the tools to open up the way for master trusts," she said.APRA's prudential standard, APS 120, will be revised to allow changes to the way securitsations are structured, in a bid to encourage banks to take Australian products to the global markets.Panel members also noted that offshore investors like to focus on two asset classes, credit cards and residential mortgages, particularly in the UK; master trusts allow issuers to de-link maturitiesArun Sharma, head of European RMBS and ABS for Barclays, said: "The key risk is extension risk, so investors prefer to see issuance from the larger banks."Offshore, there will be less issuance as the banks are de-leveraging, and have support from central banks."Ed Freilikh executive manager of group funding for the Commonwealth Bank's treasury operations, said that so far CBA has issued A$5.7 billion in RMBS. Predominantly, the proposal by APRA for removal of the 20 per cent limit on the seller's holding of its own securitisation program was of the most use, he said. This will allow banks to issue foreign currency-denominated tranches and reduce their hedging costs, which he put at about 30 basis points.Tim Hughes, treasurer at Suncorp Bank, expects master trusts will create more diversity among investors. If applied at his bank, the Apollo program would be incorporated to create more certainty around funding. "Looking at the economics and the value of capital relief for us, I wonder: are we better off just doing a capital raising?" He added that "we would consider going down… [that] path. The message that came loud and clear from Charles Littrell was not to make structures that are no different to covered bonds."Henry Cooke, from major UK investment house Threadneedle Asset Management, went back the problems in issuing bullet securities, which have the lowest hedging costs. "APRA giving themselves the whole of 2014 to discuss these changes seems like a long time," he said.Vera Chaplin, from S&P, also latched on to the need for more detail: "We need to look at the triggers, for instance, as these alter the cash flow," she said. Freilikh said that securitising other asset classes, such as credit cards, could be a possibility, but this depends on where his bank was in terms of its funding needs. "Credit cards are appealing as their spreads are stable, but we would need to look at these at the time of issue against other options, and, if sold to US investors, there are hedging costs to consider," he said.The answer may be less