News
Optimism is rising that 2014 will be a strong year for the New Zealand dollar markets after Kauri issuer Export Development Corporation (EDC) (AAA/Aaa) became the first issuer to dip its toe in the water. With the outlook for domestic issuance in 2014 broadly believed to be more positive than it was for 2013 and signs that Kauri momentum from last year may be maintained, intermediaries say the ingredients are there for a bumper new issuance year in New Zealand.
On January 13, Nordic Investment Bank (NIB) (AAA/Aaa) launched a new five-year Kauri transaction with a maturity date of January 22 2019. This will be the Kauri market's second transaction of 2014 after Export Development Canada priced a NZ$300 million (US$248.7 million) five-year deal on January 10 at 69 basis points over New Zealand government bond (NZGB) or 25 basis points over swap.
The new year sprang into life on both sides of the Tasman Sea with Kangaroo and Kauri issuance coming from a variety of sovereign, supranational and agency issuers. There has not yet been any domestic issuance activity, though Bendigo and Adelaide Bank (A-/A2/A-) is going on the road in Australia ahead of a planned bond transaction.
Submissions made during the consultation period on the terms of reference for the Australian government's forthcoming financial system inquiry (FSI) give significant insights into the hopes and fears of different segments of the Australian financial services industry. Banking competition, productive allocation of superannuation fund assets and debt funding were mentioned repeatedly in the consultation, which closed in December 2013.
Matching tradition, the new year opened in the AUD market with a clutch of Kangaroo deals from supranational, sovereign and agency (SSA) borrowers. Although the sector faces some headwinds in 2014, strong demand for the first three deals – from Rentenbank, KfW Bankengruppe (KfW) and Kommunalbanken Norway (KBN) – leads market participants to predict a solid pipeline for more issuance in forthcoming weeks.
Only two days after adding A$125 million (US$111.7 million) to its existing April 2024 Kangaroo line, Rentenbank (AAA/Aaa/AAA) priced its second Kangaroo deal of 2014. The new notes fill a gap in Rentenbank's Kangaroo curve between its existing April 13 2018 and March 9 2020 issues.
On January 9, Bendigo and Adelaide Bank (BEN) (A-/A2/A-) mandated a series of fixed-income meetings to take place in Australia, ahead of a planned bond transaction. The meetings will commence during the week of January 13.
KfW Bankengruppe (KfW) (AAA/Aaa/AAA) became the third supranational, sovereign and agency sector borrower to price a Kangaroo transaction in the new year on January 7