News
The Australian Office of Financial Management (AOFM) priced a 4.25 per cent April 2026 bond, its largest-ever via syndication, on March 12.
On March 11, New South Wales Treasury Corporation (TCorp) (AAA/Aaa) priced a new 4.5-year floating rate note (FRN). The transaction was upsized from a minimum A$500 million (US$451.3 million) sum. According to KangaNews data, TCorp is the third benchmark syndicated FRN issue this year following similar deals by South Australian Government Financing Authority and Queensland Treasury Corporation.
Healthy investor demand for securitisation issuance saw two new deals, from AMP Bank (AMP) and Heritage Bank, price in the first week of March. Borrowers and joint lead managers agree the pipeline for further issuance is strong, supported by ongoing demand for lower-rated notes and bank balance sheet participation.
On March 11, Municipality Finance (MuniFin) (AAA/Aaa) priced a new Kangaroo bond with 2024 maturity. The transaction is the issuer's second line in the Australian market although its first, which was originally launched in 2007 and subsequently tapped twice in 2008 to reach a final volume of A$390 million (US$352 million), matured in April 2011.
Westpac Banking Corporation (Westpac) says its first Basel III compliant tier-two transaction issued without retail documentation further developed the institutional participation seen in Australia's first wholesale of new-style tier-two bank debt earlier this year. But while institutional investors are broadly becoming more comfortable with new-style tier two – in particular how to value non-viability – some say they still find better value elsewhere.
The securitisation sector remains a focus of the AUD market with new domestic deals priced by AMP Bank and Heritage Bank. Elsewhere, the Australian domestic market experienced a number of firsts with Banco Sandander-Chile's debut deal, Westpac Institutional Bank debuting in the new-style wholesale tier-two market, a first AUD covered bond from National Australia Bank and SGSP Assets Australia's first AUD deal since its change in ownership.
On March 7, Westpac Banking Corporation (Westpac) (AA-/Aa2) priced its Australian dollar benchmark tier-two floating rate note (FRN) transaction. The deal is a Basel III compliant tier-two institutionally targeted transaction with a five-year non-call period.
AMP Bank priced its first prime residential mortgage-backed securities (RMBS) issue of 2014, on March 4. Progress 2014-1 Trust RMBS (Progress 2014-1) has a four-tranche structure and was upsized from its indicative aggregate volume of A$500 million (US$446.5 million).
Heritage Bank has priced a new HBS series Australian residential mortgage-backed securities (RMBS) issue – its first since 2011. HBS Trust 2014-1 is backed by first-ranking Australian residential mortgages originated by Heritage Bank and has a three-tranche structure with an aggregate volume of A$400 million (US$360.5 million).
On March 6, Banco Santander-Chile (BSC) (A/Aa3/A+) priced its debut Kangaroo transaction. The deal follows a series of fixed-income investor meetings which took place in Asia and Australia in January this year. At the time the issuer said it would explore "opportunities for capital markets transactions" in the Australian dollar market.