The fifth corporate deal of the year in New Zealand has completed a successful bookbuild with the Warehouse Group (Warehouse) (NR) claiming double oversubscription for its NZ$100 million (US$70.61 million) June 2015 transaction. However, with local corporates relatively well-funded intermediaries say the medium-term deal pipeline may be limited.
National Australia Bank (NAB) subsidiary National Wealth Management Holdings (NWM) (AA-) priced a new three-year domestic deal on March 23, selling A$350 million (US$320.74 million) at 195 basis points over swap. The issuer has not brought a deal to the domestic market for just over three years but it does have a A$150 million maturity on March 26.
Macquarie Securitisation (Macquarie) has priced a A$1.2 billion (US$1.11 billion) privately placed residential mortgage-backed securities (RMBS) deal – PUMA Masterfund S-8 – as an agreed restructure of an externally provided mortgage warehouse facility. Some 54 per cent of the deal's pool is represented by full documentation mortgages with the balance low doc loans.
The third Australian market corporate bond deal of the year – also the third in just four days – priced on March 19 as Mirvac Group Funding (Mirvac) (BBB) placed A$150 million (US$138.26 million) in a significantly oversubscribed five-year transaction. The issuer says the emerging appetite for longer-tenor credit among Australian investors was also evident in the lead-up to its transaction.
Sweden's local government funding agency, Kommuninvest (AAA/Aaa), has visited debt investors in Australia and New Zealand for the first time with the message that its growing balance sheet means it intends to become a regular issuer in both Kangaroo and Kauri markets. The firm roadshowed in New Zealand on March 15 and 16 and Australia on March 17-19.
Gradually building deal flow in the Australian corporate market is starting to establish confidence on pricing and relative value, market participants say. Meanwhile investors say the most recent corporate transaction – the upsized A$300 million (US$276.21 million) September 2017 placed by SP AusNet (A-/A1) on March 18 – clearly demonstrates appetite for longer-tenor deals.
Colonial First State Global Asset Management (CFS) priced the first Australian commercial mortgage-backed securities (CMBS) deal for over six months on March 18, with the leads claiming "heavy oversubscription" allowed an early close. The deal, for A$370 million (US$341.29 million), wholly refinances a June 2010 maturity from the same issuer.
The third Kangaroo deal in two days priced on March 18, with European Investment Bank (EIB) (AAA/Aaa/AAA) adding A$600 million (US$553.8 million) to its April 2015 line to bring the total issue size to A$2.1 billion. The tap came to market at 59.75 basis points over the April 2015 Australian government bond or 29 basis points over semi-quarterly swap.
Following a recent debt investor update, on March 18 Mirvac (BBB) launched a five-year domestic deal with minimum size of A$100 million (US$92.21 million). While the issuer has two domestic maturities in 2010 it is also understood to be comfortably funded and only to be seeking a relatively limited volume in the latest transaction.
The residential mortgage-backed securities (RMBS) transaction priced by Bendigo and Adelaide Bank (BEN) on March 17 was upsized by A$450 million (US$413.42 million) to a final volume of A$1.1 billion. The transaction – Torrens Series 2010-1 (Torrens 2010-1) – also saw a significant scaling of investment from the Australian Office of Financial Management (AOFM).
The new April 2016 benchmark line priced by New South Wales Treasury Corporation (TCorp) on March 17 saw nearly twice as much demand in its book than the A$1 billion (US$918.5 million) final deal size. The deal came in towards the tighter end of its indicative pricing range and just inside levels predicted by analysts at launch a day earlier.
Recent concerns over European sovereign risk do not appear to have dampened demand for European issuers from the supranational, sovereign and agency (SSA) sector in the Kangaroo market, with KfW Bankengruppe (KfW) (AAA/Aaa/AAA) and Council of Europe Development Bank (CEB) both pricing deals on March 17. Combined volume on the two trades was A$475 million (436.38 million).