News
In the wake of its return to domestic issuance, Suncorp-Metway says likely volatility in the months ahead mean it is more important than ever to secure funding when the opportunity presents. The issuer became the first Australian-domiciled credit issuer to print a new bond deal since the emergence of the COVID-19 crisis, on 20 April.
New Zealand intermediaries are optimistic on market momentum but say it may still be some time before the market truly returns to normality. The tone is emerging in the wake of unprecedented volume of supply from 7-17 April as local government-sector borrowers re-entered the syndicated market.
Two more blue-chip Australian corporate borrowers have successfully printed deals in the euro market, despite not being eligible for the EU corporate-sector purchase programme (CSPP). Deal sources say euro investors are demonstrating ongoing appetite for high-quality corporate names.
Kāinga Ora – Homes and Communities has become the first New Zealand issuer without direct secondary support from the central bank to print a primary deal in New Zealand since the COVID-19 crisis began. The issuer says demand for the 17 April transaction outstripped expectations, particularly at 10-year tenor.
The Australian Office of Financial Management (AOFM)’s first syndicated deal since the beginning of the COVID-19 crisis and the consequent deluge of fiscal stimulus is a key moment in the Australian market recovery. Deal sources are confident the jumbo volume and broad-based demand signal that large transactions will be possible.
New Zealand Local Government Funding Agency is confident domestic market conditions are improving, supported by an expanded central bank asset-purchase programme. The issuer says its latest transaction is an encouraging sign the market will have capacity for increased supply from New Zealand’s semi-government borrowers.
The Australian dollar credit market has been reopened by three Canadian bank covered bond deals that priced within a week. Each deal showed signs of market development, although demand remains driven primarily by bank balance sheets as liquidity gradually improves with central bank support.
The Australian Office of Financial Management (AOFM) has provided an update on how its Structured Finance Support Fund (SFSF) will invest. The 9 April announcement describes a broad allocation strategy, including helping to clear an “overhang developing in the secondary market” and working with the Australian Securitisation Forum (ASF) to support securitisation trusts affected by missed interest payments.
New Zealand Debt Management (NZDM) faces a mountain of issuance in the coming months despite a NZ$3.5 billion (US$2.1 billion) May 2031 syndicated transaction printed on 7 April. The sovereign debt-management agency spoke to KangaNews about its strategy in the wake of the new transaction.
The Australian semi-government sector is undertaking a flurry of issuance in syndicated and privately placed format, as borrowers seek to stay ahead of growing funding tasks. Deal sources say the market is functional but challenging, as issuers try to overcome substantial sovereign supply and an evolving central bank buying programme.
International Finance Corporation (IFC)’s latest Kangaroo social bond leverages increased recognition of the product’s utility in the COVID-19 crisis, the issuer states. It is the first new green, social and sustainability bond line established in the Australian dollar market this year.
Fitch Ratings (Fitch) downgraded the long-term issuer default ratings of the Australian major banks and their New Zealand subsidiaries on 7 April, to A+ from AA-, and kept all four on negative outlook. The decision reflects the expected effect on core markets and bank operations of measures being implemented by governments to limit the spread of COVID-19.