Home loan provider RHG Ltd plans to move back the call date on some of its outstanding residential mortgage-backed bonds, in a sign the credit crunch is still affecting financial institutions.

RHG, which used to own the Rams brand before it was sold Westpac Banking Corp, will ask bond holders whether it can move the call date for $232 million debt to April 2010 from May 2008, the company said in a statement today.

The bonds, which were issued in 2002, were in four classes, of which the A1 and A2 notes have been repaid.

RHG is proposing to raise the yield on $187 million of A3 notes to 85 basis points over the three-month bank bill swap rate (BBSW), which is the step-up margin plus an additional five basis points, from the original 39 basis points.

There will be a new step up margin of 100 basis points if RHG chooses to extend the call date again in 2010.

The coupon will also be increased on $45 million of class B notes to 105 basis points from the original 70 basis points over BBSW.

RHG would contribute further credit support for the B notes, which should result in their credit rating being upgraded, the company said.

RHG said if bond holders do not approve the proposal, the company would not call the notes and the original step up margin would be paid.

The company said a similar proposal would be made for about $364 million of outstanding bonds due in June.

AAP