News
Fitch Ratings (Fitch) published a report on May 2 arguing that the Australian Prudential Regulation Authority (APRA)'s recent consultation document on its forthcoming new securitisation regime would not in its current form pave the way for a workable master-trust market. However, there are hopes that the issues can be dealt with during the new regime's consultation process.
In a May 1 speech, the chairman of Australia's financial system inquiry (FSI), David Murray, suggested that he acknowledges some of the concerns of regional banks around the anticompetitive aspect of perceived sovereign support for some financial institutions. He also promised the FSI will explore claims that Australia's regulatory settings have become too focused on system stability at the expense of competition.
ANZ Banking Group (ANZ)'s results for the half-year to the end of March 2014, released on May 1, paint a picture of stability in terms of capital, funding and liquidity. Meanwhile, the bank attributes a small reduction in year-on-year income from the Australian arm of its global markets business to specific headwinds in the fixed-income market.
On April 30, Emirates NBD (Baa1/A+) priced a five-year Australian dollar deal. The transaction is the new borrower's first Kangaroo deal since a merger between Emirates Bank and National Bank of Dubai in 2007. The merger created the largest bank in the six Arab Gulf states – Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates – the Middle East and North Africa, with assets of US$45 billion.
The Australian Prudential Regulation Authority (APRA) opened a consultation period on its latest proposals for a simplified Australian securitisation regime on April 29. The regulator revealed at the same time that it plans to consult the market on the regime again in 2015 and is targeting implementation in 2016.
New Zealand's opposition Labour Party proposed a raft of new economic measures on April 29, including changes to the KiwiSaver savings scheme to make it – like its Australian equivalent – compulsory for paid employees. The system currently operates on a voluntary opt-in basis, and KiwiSaver data says just fewer than 2.3 million New Zealanders, or roughly half the population, were members by March this year.
On April 28, Investec Bank Australia (Investec Australia) announced an offer to buy back the outstanding balance of its December 2014 and March 2015 maturity government-guaranteed bond lines. The indicative repurchase price for the borrower's fixed-rate December 2014 notes is 10 basis points below swap. Investec Australia is also offering to repurchase its March 2015 floating-rate paper at 10 basis points below three-month bank bill swap (BBSW) rate.
A brace of public holidays in Australia prompted an expected slow week in the local capital market. Only one Kangaroo deal priced during the week, alongside a handful of rating actions.
Provisional ratings have been assigned to Cuscal's new Australian dollar residential mortgage-backed securities (RMBS) issue. The transaction, Integrity Series 2014-1 Trust, has an indicative volume of A$698.5 million (US$648.9 million) across four tranches according to a preliminary ratings report.
On April 24, Rentenbank (AAA/Aaa/AAA) priced a new 12-year Kangaroo line. According to KangaNews data, Rentenbank most recently visited the Australian dollar market on March 25 this year with a A$125 million (US$117.1 million) tap to its 2024 line. That deal had pricing of 65.5 basis points over Australian government bond.