On Friday August 21 KfW Bankengruppe (AAA/Aaa/AAA) priced a A$300 million (US$252 million) increase to its 5.50 per cent August 2013 Kangaroo bond. The tap, led by TD Securities and UBS, brings the total outstanding in this line to A$700 million and total Kangaroo issuance this year from all issuers to A$9.25 billion.
On Friday August 21 Rabobank Nederland New Zealand Branch (Rabobank NZ) (AAA/Aaa) closed a NZ$100 million (US$68 million) retail issue, maturing in September 2014. The transaction, which was led by ANZ and BNZ Capital, priced at 94 basis points over the benchmark mid-swap rate, wider than the issuer's A$250 million tap of its 2012 line, which priced on 27 July.
On August 18 New South Wales Treasury Corporation (TCorp) (AAA/Aaa) priced its biggest-ever single transaction inflation-linked bond. The A$800 million (US$661 million) 3.75 per cent November 2020 capital-indexed bond priced with an outright real yield of 3.75 per cent on a bookbuild basis, with J.P. Morgan as sole bookrunner.
European Investment Bank (EIB) (AAA/Aaa/AAA) has priced the A$300 million (US$245 million) increase to its 6.5 per cent August 2019 bonds, bringing the total amount on issue to A$1.05 billion. This is the third 10-year transaction priced by a supranational in the Kangaroo bond market this year, following EIB's inaugural 2019 transaction and Inter-American Development Bank (IADB)'s opening of an August 2019 bond on August 6.
Members Equity Bank (MEB) (BBB/A2) saw a twice-oversubscribed book for its debut medium-term note (MTN) issue in the domestic market, a A$500 million (US$418.1 million) fixed and floating rate three year deal that achieved the tightest pricing yet for a guaranteed transaction from a small or regional Australian authorised deposit-taking institution (ADI).
The August 13 pricing of Citi Australia (Citi)'s (A+/A2) new 2012 guaranteed deal saw the bank raise A$1.25 billion (US$1.04 billion) at the tightest margin yet seen on a guaranteed deal from a non-big four issuer. The self-led deal was also Citi's second Australia guaranteed 2012 transaction this year following its A$1.3 billion issue from June 11.
The Australian Office of Financial Management (AOFM) has sold all its holdings of Australian state government and Kangaroo bonds, with its allocation to semis falling from A$3.82 billion (US$3.19 billion) as recently as the end of May this year to zero two months later. Its Kangaroo portfolio, which peaked at A$615 million at the turn of the year, was liquidated by the end of May.
As predicted at launch earlier in the day, Nordic Investment Bank (NIB) (AAA/Aaa/AAA) completed pricing of its A$300 million (US$245.67 million) new August 2014 Kangaroo bond at the tightest margin seen in the market so far in 2009 – 36 basis points over swap or 65.5 basis points over the benchmark June 2014 Australian government bond.
A brace of Kangaroo deals from August 12 have continued the trend for tightening margins for the supranational, sovereign and agency (SSA) asset class in Australia, with the A$300 million (US$248.94 million) 2015 tap from KfW Bankengruppe (KfW) (AAA/Aaa/AAA) offering low- to mid-40s basis points over swap and a new 2014 from Nordic Investment Bank (NIB) (AAA/Aaa) expected to offer an even tighter margin at its forthcoming pricing.
After a very quiet month for Aussie bank funding teams, Westpac Banking Corporation (Westpac) (AA/Aa1/AA-) has priced a self-led A$2 billion (US$1.67 billion) fixed and floating non-guaranteed five-year transaction. J.P. Morgan was co-manager on the deal.
Volume in the 10-year Kangaroo market reached A$1.325 billion (US$1.12 billion) within a week with the August 6 pricing of the Inter-American Development Bank (IADB)'s (AAA/Aaa/AAA) A$575 million new August 2019 maturity. The latest deal demonstrates growing demand in the long end of the curve with pricing inside the other recent 10-year from European Investment Bank (EIB) (AAA/Aaa/AAA).
The August 2012 bond launched by Barclays Bank Australia Branch (Barclays) (AA-/Aa3) on August 4 has priced a total of A$1.5 billion (US$1.26 billion) of fixed and floating rate paper at 165 basis points over swap. The transaction marks the issuer's debut in the Australian market, either through its local branch or via a Kangaroo from the parent firm.