News
On 21 February, BNP Paribas priced a dual-tranche senior nonpreferred EMTN, the first Australian dollar deal in this format for 2019. Lead managers say taking a simple, broadly appealing structure to the market was essential in achieving benchmark volume in what can be a challenging format.
African Development Bank (AfDB) made its first foray into the Kauri market in more than four years on 21 February, with a rapidly launched and priced 10-year socially responsible investment (SRI)-linked deal. The issuer and lead say the deal was made possible by reverse enquiry from Asia, and insist the theme and maturity present a positive development for the market.
World Bank’s latest Kangaroo deal marks its return to large mid-curve volume issuance, having been absent since September 2017. The leads and issuer say a softening global rates environment and increasingly positive market tone were key in achieving very robust volume outcome.
National Australia Bank (NAB)’s latest Australian dollar senior deal faced some challenges in execution, deal sources say, but still managed to draw significant volume and tightened pricing relative to guidance. The transaction is evidence of a growing trend of higher volume but lower issuance frequency by Australia’s major banks.
Trustpower kicked off New Zealand corporate flow for 2019 with an outcome that sources insist carries over positive momentum from the previous year. It is the first New Zealand unrated corporate deal to break a 4 per cent coupon floor, using the 10-year resetting structure which gained in popularity late in 2018.
Broad investor participation characterised Westpac Banking Corporation (Westpac)’s first residential mortgage-backed securities (RMBS) transaction since 2015. The issuer attributes robust demand to structural features including a funding-only structure, a date-based call and a Hong Kong listing – and envisages a more regular RMBS issuance schedule going forward.
A debut Kangaroo transaction from General Motors Financial Company (GM) has kick-started Australian corporate issuance in 2019. Deal sources say the tenor and volume achieved were a good result for this segment of the corporate market and lay a good platform for an issuer that has also established a domestic subsidiary.
In January 2019, KangaNews invited representatives of New Zealand’s major government-sector funders to a roundtable discussion in Wellington. The discussion covered all the factors most relevant to these issuers in today’s market – including the global funding environment, supply-and-demand dynamics and the future of New Zealand sustainability financing.
The start of 2019 marks an interesting juncture for Australia’s government-sector borrowers, characterised by falling sovereign issuance, heightened market volatility and the emergence of sustainable debt as a regular funding option. KangaNews gathered the market’s key players at a roundtable discussion in Sydney to exchange views on the outlook.
National Australia Bank (NAB) launched an Australian dollar additional tier-one (AT1) capital transaction on 11 February, its first in more than two years. The deal’s arranger predicts robust demand despite various headwinds, based on recent secondary-market activity and appropriate primary-market pricing.
Teachers Mutual Bank (Teachers Mutual) has taken its commitment to responsible investment a step beyond its peers, by having Responsible Investment Association Australasia (RIAA) certify its retail deposits, mortgages and wholesale funding. According to Teachers Mutual, the move could generate more than A$3.5 billion (US$2.5 billion) of socially responsible investments for the bank by 2021.
Offshore investor participation surprised to the upside in Export Development Canada (EDC)’s latest Kauri deal. While the rates differential between the US and New Zealand has tended to dampen international demand for New Zealand dollars of late, the Canadian issuer found an uptick in the global bid thanks to a favourable relative-value proposition.