News

Reserve Bank of New Zealand (RBNZ) is reviewing the limits SSA issuers are given for repo purposes as agencies in particular reach or approach their maximum Kauri volumes. And with RBNZ hoping to complete its review by mid-year market sources say there are more agency borrowers ready to issue Kauris if a favourable decision is made.

EUROFIMA (AAA/Aaa) priced a further A$100 million (US$93.09 million) increase to its 2010 Kangaroo bond on April 11, having upped the line by A$200 million seven days previously. The total size of the bond has now reached A$700 million.

KfW Bankengruppe (AAA/Aaa/AAA) priced a A$200 million (US$185.22 million) increase to its August 2011 Kangaroo on April 8, bringing the total size of the line to A$600 million and its total outstanding 2011 Kangaroo paper to A$1.1 billion, despite ongoing volatility in the basis swap market.

A quiet Kangaroo primary market reopened on April 4 as EUROFIMA (AAA/Aaa) increased its 2010 line by A$200 million (US$182.36 million), taking the total amount on issue to A$600 million.

Rabobank (AAA/Aaa) has priced a A$200 million (US$182.8 million) increase to the 2011 bond issued by its local branch, Rabobank Nederland Australia. The deal, jointly lead-managed by Commonwealth Bank of Australia and Société Générale Australia, brings the total size of the line to A$700 million.

Bank Nederlandse Gemeenten (AAA/Aaa/AAA) (BNG) increased its 2010 Kauri bond by NZ$100 million (US$80.48 million) on March 28, bringing the total outstanding in the line to NZ$350 million.

Following a 10-day lull in Kangaroo issuance around the Easter holiday, exacerbated by a highly volatile AUD basis swap market, Instituto de Crédito Official (AAA/Aaa/AAA) (ICO) reignited the primary market with a March 28 tap of its 2011 line.

A further sign of interest in longer-dated Kangaroos came on March 18 as EUROFIMA (AAA/Aaa) priced a A$250 million (US$230.5 million) increase to its 2018 bond. The deal follows European Investment Bank's recent increase to its 2017 Kangaroo line.

The bailout of Bear Stearns (BBB/Baa1/A-) by J.P. Morgan Chase (AA-/Aa2/AA-) (J.P. Morgan) will have a direct impact on over A$3 billion (US$2.76 billion) of Kangaroo bonds from the two issuers, although Bear Stearns' paper may emerge from the trauma with an upgraded rating.

Nordic Investment Bank (AAA/Aaa) (NIB) returned to the Kauri market on March 14 with a new deal, a NZ$100 million (US$81.51 million) 2015. The transaction priced at 120.5 basis points over the benchmark 6 per cent 2015 sovereign bond, equating to 22 basis points below swap according to lead manager ANZ.

European Investment Bank (AAA/Aaa/AAA) (EIB) has reinforced its position as the leading Kangaroo issuer of 2008 to date with a further increase of A$400 million (US$374.2 million) to its 2017 line – the second time it has tapped the A$1.6 billion bond this year.

Asian Development Bank (AAA/Aaa/AAA) (ADB) priced its third Kangaroo transaction of the year on March 12, a A$300 million (US$279.4 million) five-year bond which is also its first new Kangaroo line since November 2006.