News
Europe is responding to a looming energy crisis by reviving and ramping up fossil fuel power. But its longer-term commitment to renewables transition remains in place and is only being enhanced by a new focus on energy security, according to new research from MUFG Securities’ capital markets strategy group. While Australia will be shielded from the crisis to at least some extent, local companies should not mistake emergency measures elsewhere for a change in direction.
When SMART Alabama – a Hyundai consolidated subsidiary – was caught allegedly using children as young as 12 on its factory floor in the US, QIC immediately jumped to respond. In an exclusive interview with KangaNews, Marayka Ward, director, sustainable investments, liquid markets group at QIC in Brisbane, explains how the fund manager tackled this thorny issue.
The New Zealand Financial Markets Association’s recently published debt capital market guidelines give participants a roadmap to greater clarity and best practice, particularly for new and infrequent issuers. The guidelines are part of the association’s push to develop New Zealand’s debt market, making it more inclusive.
New Zealand’s official cash rate will likely hit 4 per cent, but a range of domestic and global factors will dictate how long it stays elevated. The impact of a higher rate on the country’s economy, however, is unclear – particularly as interest rate risk remains to the upside, according to economists.
Australian nonbank lenders have long discussed the potential alignment of the type of lending they do with social-bond funding. As the first local issuer to bring an all-social residential mortgage-backed securities deal, Pepper Money says the value of the platform is primarily about the opportunity this type of funding offers for future development of lending product.
The nascent revival in Australian credit issuance appears to be spreading beyond domestic borders. Private banks in Asia – particularly Singapore – are showing increased interest in high yielding, quality Australian dollar fixed income with a particular focus on subordinated financial debt, intermediaries say.
The term funding facility was a sufficiently large market intervention to all but negate Australian banks’ wholesale funding requirements for around 18 months. The bill starts to come due on this vast sum of central-bank liquidity early in 2024, but while the refinancing need will elevate wholesale funding needs, market sources say it will likely not be a like-for-like replacement.
CPP Investments defied a recently sluggish high-grade Kangaroo market to record the second highest volume of any Australian dollar print by a supranational, sovereign and agency (SSA) borrower this year. Deal sources say the transaction speaks to an improving market tone and interest in the borrower’s profile, as well as an extension in duration demand to five years.
New Zealand Debt Management says its recent inflation-indexed bond tap – its first syndicated linked deal for more than five years – uncovered interest from new and offshore investors sufficient to support a significant oversubscription. The tap and simultaneous repurchase of the 2025 linker follow changes to the tendering process, which together should help reinvigorate the asset class, according to market participants.
International Finance Corporation’s new three-and-a-half year Kangaroo print marks its first new line issued in the Australian market since November 2020. The deal also hints at improving conditions for supranational, sovereign and agency issuers in the Kangaroo market as the first deal of A$500 million (US$345.2 million) or more in the sector since June and just the second since February.
APM Human Services International has executed what it believes is Australia’s first use-of-proceeds social loan via a unique structure that funds operating expenditure. The transaction refinances the newly listed company’s Australian dollar term loan B financing and preference shares, and can be extended if the group embarks on further acquisitions over the next 12 months.
Commonwealth Bank of Australia rode domestic support for its latest senior-unsecured transaction to a record orderbook. The multitranche bond surpassed the bank’s previous record print, from January this year, making the new deal the largest Australian dollar bank deal ever executed.