ME Bank last week launched its latest non-AOFM backed mortgage-backed securities issue via SMHL Securitisation Fund 2009-3. The A$500 million RMBS issue, with a final legal maturity of November 2040, will comprise: A$239.5 million of Class A1 notes, rated 'AAA/AAA' by S&P and Fitch; A$239.5 million of Class 1R notes, rated 'AAA/AAA'; A$10.5 million of Class AB notes, rated 'AAA/AAA'; and A$10.5 million of Class B notes, rated 'AA-/NR'.The issue has an innovative structural feature that is now being used in RMBS issues in the UK, mentioned here a few weeks ago. The Class 1R notes are redeemable and convertible into Class 1 notes. The redeemable feature of the Class 1R notes is intended to give investors liquidity and is supported by a standby line of credit provided by National Australia Bank. The merits of the redeemable/convertible feature can be debated and obviously will be subject to various terms and conditions but the intention is to try to meet the needs of investors, as much as possible, to get the RMBS market moving again.Based on ME Bank's success with its two prior, non AOFM-backed RMBS issues, this one should also be very well received by investors and can be expected to be upsized. Pricing is scheduled for tomorrow.