News
Deal sources say real-money investors embraced Bank of Queensland (BOQ)’s decision to print the first conditional pass-through (CPT) covered bond in Australian dollars. The A$750 million (US$483.8 million) five-year deal priced on 7 May.
QBE Insurance has become the first offshore-domiciled issuer to execute a capital transaction in the US 144A market since the escalation of the COVID-19 crisis, with a deal that leads say has piqued the interest of bank and insurance borrowers globally.
Including yen-dominated notes in its latest residential mortgage-backed securities (RMBS) deal is the culmination of many years work with Japanese investors, Liberty Financial says. It expects issuing in yen will form a component of its ongoing funding strategy.
Australian market participants generally expect only a gradual and marginal impact from the Reserve Bank of Australia (RBA)’s 5 May decision to make certain corporate bonds eligible collateral for open market operations. Even so, the criteria encompass a massive portion of Australian dollar corporate debt and took the market by surprise.
BNG Bank’s benchmark Kangaroo deal priced on 30 April was the first broadly distributed new line established in Australian dollars by a supranational, sovereign and agency (SSA) borrower in 2020. Deal sources say relative value to Australian semi-government borrowers drove demand.
COVID-19 has thrown up challenges even for the most established capital markets borrowers. The crisis is particularly acute for newer financial institutions with shorter track records and smaller asset books. Government support should help, but a protracted downturn could make survival of the fittest a best-case scenario.
APT Pipelines, the borrowing entity of APA Group, has returned to the euro market for the first time since its 2015 debut. Deal sources say the borrower’s credit story and lack of exposure to oil enabled a successful transaction amidst a pocket of volatility.
In March, Europe’s technical expert group on sustainable finance (TEG) delivered the final report on the EU’s taxonomy for climate change mitigation and adaptation. The taxonomy – and the green bond standard (GBS) that is expected to follow it – will have global ramifications for sustainable finance including opportunities and challenges for Australasian market participants.
Fitch Ratings and KangaNews have been conducting the Fixed-Income Investor Survey since the first half of 2014. The 2020 iteration combines a deeply negative outlook with vast areas of uncertainty to produce the survey’s most worrying set of data ever.
The Reserve Bank of Australia (RBA) jumped into the fog of dislocated debt capital markets in March with an unlimited government and semi-government asset purchase programme. Local investors are contemplating a cascade of market consequences.
Inflation-linked bonds could come to form a greater portion of Kāinga Ora – Homes and Communities’ funding portfolio as it provides long-term funding matched to its primary revenue stream, the issuer tells KangaNews after its debut deal in the format.
The Reserve Bank of Australia is meeting its targets for unconventional monetary policy and has begun tapering its purchases. The market appears to have avoided an adverse response so far, indicating a degree of comfort with the RBA’s policy, analysts say.