News
The new revolving loan facility Adelaide Airport signed with ANZ on 20 December is the first in Australia to feature a sustainability performance component. This “incentivises a borrower to even further improve its performance against a set of environment, social and governance [ESG] criteria” according to an Adelaide Airport statement.
New South Wales Treasury Corporation (TCorp) revealed an unchanged funding requirement of A$6.6 billion (US$4.7 billion) for the 2018/19 financial year on 18 December, following the release of the state government’s half-yearly review (see table).
On 18 December, following the release of the Australian government’s mid-year economic and fiscal outlook (MYEFO), the Australian Office of Financial Management (AOFM) revealed a reduced 2018/19 financial year borrowing requirement of around A$52 billion (US$37.3 billion), down from around A$70 billion at the 2018/19 budget.
Non-residential mortgage-backed securitisation volume is significantly down in 2018 compared with recent years – primarily, sources insist, as a result of lack of supply by regular bank issuers. However, recent nonbank issuers in the auto asset-backed securities (ABS) space say investors are still eager for diverse product, resulting in well supported deals.
The international bank debt-issuance market is constantly evolving, with the emergence of total loss-absorbing capacity (TLAC) and renewed volatility among 2018’s most notable developments. KangaNews speaks to funding executives from Asia, Australia, Europe, Japan and North America to get the latest on market conditions and outlook.
The New Zealand securitisation market welcomed a new entrant on 6 December when Latitude Financial Services (Latitude) priced its inaugural New Zealand dollar asset-backed securities (ABS) deal. The deal’s domestic focus provided insulation from external market forces according to deal sources, who add that there is growing enthusiasm for securitised product among local buyers.
Commonwealth Bank of Australia (CommBank) has printed the first Australian-origin transaction to reference an alternative benchmark rate. The bank issued £125 million (US$158.8 million) of one-year notes on 3 December at 40 basis points over the sterling overnight index average (SONIA), via RBC Capital Markets (RBCCM). Deal sources say the UK market is the most progressed towards base-rate change, but add that there is much work still to be done ahead of the forthcoming expiry of interbank offered rates.
Having been acquired by Cerberus Capital (Cerberus) in March 2018, Bluestone Group (Bluestone)’s Sydney-based chief executive officer, Campbell Smyth, says the business has been able to expand significantly into the near-prime lending space. The company’s conservative lending practices have remained, he adds, leaving it well placed for sustained future growth.
KangaNews is proud to present the winners of the institutional and deal categories in the KangaNews Awards 2017. After an extensive voting and verification process, KangaNews can confidently say its results reflect a true market view on the outstanding performers of 2017 in the Australian and New Zealand debt markets.
Pepper Group (Pepper)’s latest residential mortgage-backed securities (RMBS) transaction featured two tranches backed by green mortgages, one denominated in euros, and also added a US dollar note. The issuer has a firm commitment to issuing further euro-denominated green tranches, which it hopes will unlock European demand as its funding requirement continues to rise.
Chorus’s return to domestic issuance represents a significant development for the New Zealand corporate credit market, deal sources say. The 10-year transaction features a rate reset after five years, which helped stimulate retail demand. Market users expect the feature to be used again given the success of Chorus’s transaction.
Accessing private investors and adding scale to tangible impact investing motivated World Bank to bring its new sustainable growth bond. The issuer and its lead say the deal presented a unique opportunity to engage new investors on the UN sustainable development goals (SDGs) and World Bank’s bond issuance.