News
The Reserve Bank of New Zealand (RBNZ) lifted the official cash rate (OCR) by 25 basis points to 3.5 per cent, on July 24. This is the central bank's fourth consecutive rate hike but analysts note intent to pause –albeit temporarily – from here on in.
ME Bank priced SMHL Series Securitisation Fund 2014-1 on July 23. The transaction has a total volume of A$1.45 billion across four tranches.
When Corporación Andina de Fomento (CAF) (AA-/Aa3/AA-) became the first-ever Latin American-origin issuer to tap the Kangaroo market in August last year, intermediaries were doubtful that a flurry of similar deals would quickly follow. However, KangaNews understands that the pipeline is filling with three more issuers in varying stages of readying deals.
On July 22, ANZ Banking Group (ANZ) (AA-/Aa2) launched and priced a new five-year Australian dollar benchmark transaction. The self-led deal is the borrower's first five-year senior transaction of 2014; it issued a A$2 billion (US$1.8 billion) dual-tranche deal in October last year at 88 basis points over swap.
*Registrations are still open for the KangaNews DCM Summit, which returns to Auckland on August 6. An up-to-date agenda, including confirmed keynote speakers, and instructions on how to register can be found here.* Australian deal activity was limited to four new transactions in the week under review leaving the interim report of the Australian financial system inquiry to take centre stage.
A new Australian dollar residential mortgage-backed securities (RMBS) deal was priced by Origin Mortgage Management Services (Origin MMS), on July 18. The transaction, Triton Trust No.2 Bond Series 2014-1, was upsized from its indicative volume of A$350 million (US$328.9 million) across three tranches.
National Australia Bank (NAB) and Westpac Institutional Bank (Westpac) scored notable successes as intermediaries in the Australian domestic bond market in the first half of the year, according to KangaNews league tables. Deutsche Bank's strength in the primary Kangaroo and semi-government markets put it in a leading position for aggregate Australian dollar issuance. Meanwhile, ANZ maintained its dominant status in New Zealand.
The interim report of Australia's financial system inquiry (FSI) narrows down the field of reference on the subject of competition in the banking sector. The report makes clear that the inquiry does not believe there is a major issue to be addressed around competitiveness, though it suggests there are grounds for further study in a number of specific areas.
On July 15, International Finance Corporation (IFC) (AAA/Aaa) priced a new five-year Kangaroo issue. The transaction is IFC's second in the Australian market in 2014.
The interim report of the Australian financial system inquiry (FSI) suggests that the inquiry is looking closely at whether one of the key incentives for investment in local equity – a tax advantage through dividend imputation – remains useful. The report highlights potential weaknesses in deposit and bond markets caused by the structural preference for tax-favoured alternative asset classes in Australia.