News
Many submissions to Australia's financial system inquiry (FSI) include some discussion of what is perceived in many quarters to be a problem with the country's superannuation system: its failure to provide a product suite to support the increasing cohort of post-retirement savers. Proposed solutions are multifarious, but many are based on a request for superannuation-sector innovation to be promoted rather than hindered.
A number of submissions to Australia's financial system inquiry (FSI) discuss the issue of asset allocation within the country's superannuation system – including the perception that allocation to income assets is too low. Proposals mainly focus on taxation and investor education, while Industry Super Australia (ISA) lays out a root-and-branch assessment of the superannuation system with a raft of proposals designed to facilitate longer-term investment.
A number of submissions to Australia's financial system inquiry (FSI) include commentary and proposals on the bond market – most commonly relating to a desire to develop a larger domestic option for funding corporates and the infrastructure sector. Regulatory impediments, retail development and education, asset allocation and the tax system all come under the microscope of market participants.
The first week of April saw an uptick of activity in the Australian market with seven Kangaroo and three domestic deals priced. Meanwhile Auckland Airport kept the New Zealand market ticking over with its first domestic deal since December 2012.
KfW Bankengruppe (KfW) (AAA/Aaa/AAA) priced an increase to its January 2016 Kangaroo bond on April 4. The line in question was introduced in a A$600 million (US$554.6 million) trade in January 2011, according to KangaNews data, and has subsequently been increased to A$2.3 billion. KfW also has A$300 million of floating-rate Kangaroo paper with the same maturity.
The inaugural Australian Fixed-Income Investor Survey, published by Fitch Ratings (Fitch) and KangaNews on April 2, suggests Australian investors see the situation in China as the biggest risk factor to domestic credit markets over the next year. However, responses elsewhere suggest the investor base remains relatively comfortable with the state of the market, for instance predicting gradual contraction to be the prevailing credit spread dynamic.