News
On November 6, KfW Bankengruppe (KfW) (AAA/Aaa/AAA) tapped its March 2024 Kangaroo bond. This is the first tap of the A$300 million (US$285 million) line which was introduced on September 11 this year at 93.5 basis points over the Australian government bond (ACGB).
In the wake of an entirely expected decision by the Reserve Bank of Australia (RBA) to leave the Australian cash rate on hold – at 2.5 per cent – on November 5, Australian economists are increasingly leaning towards believing the cutting cycle has ended. However, most acknowledge that the reserve bank's post-decision statement remains highly cautious with the level of the Australian dollar of renewed concern.
The three Australian major banks to have issued annual results between October 29 and November 4 all reiterated the same story that has characterised capital and funding efforts since the financial crisis. Deposit funding continues to creep upward and wholesale issuance has fallen – though at least one of the majors suggests its aversion to wholesale issuance growth might change in response to future credit growth.
Australian Postal Corporation (Australia Post) returned to the AUD market after a three-year absence on November 1, with a new dual-tranche issue which included 10-year notes. ANZ, joint lead manager on the deal, cites demand for long tenor for the borrower's decision to return to the market – and says this type of issuance is expected to develop further before the end of the year.
Australian domestic issuance ramped up as the first month of the final quarter ended with pricing on seven new deals and two increases. A multitude of sectors were active with the biggest volume driver coming from a brace of post-results major bank benchmarks.
MyState priced its third residential mortgage-backed securities (RMBS) issue off its ConQuest securitisation programme on November 1. The deal is the issuer's return to the market after a three-year hiatus.
Australian Postal Corporation (Australia Post) (AA) priced a new dual-tranche domestic medium-term notes transaction on October 31. This is the first substantially sized 10-year transaction in the Australian corporate domestic market since SPI Electricity & Gas Australia (A1) raised A$175 million as part of a dual-tranche transaction in June 2012. That tranche priced at 205 basis points over swap.
On November 1, National Australia Bank (NAB) (AA-/Aa2) priced a new five-year benchmark Australian dollar floating-rate note transaction. The self-led deal comes hard on the heels of a similar outing by ANZ Banking Group (ANZ).
In its annual report the Australian Office of Financial Management (AOFM) characterises its 2012/13 financial year as one that it has spent focusing on the long-term development of the Commonwealth's funding portfolio in the face of challenges which it also expects to continue in 2013/14.
On November 1, New South Wales Treasury Corporation (TCorp) (AAA/Aaa) priced a new April 2021 maturity benchmark line. According to KangaNews data, TCorp priced its previous syndicated domestic deal on May 8, a 10-year issue with a volume of A$1 billion (US$946.6 million) and pricing of 81 basis points over ACGB.
Bank of Queensland (BOQ) (A-/Baa1/BBB+) priced a new three-year FRN transaction in the Australian market on October 31. According to KangaNews data, BOQ priced its previous domestic issue on May 22 with a volume of A$325 million (US$307.7 million) and pricing of 135 basis points over bank bill swap rate.
On October 31, Queensland Treasury Corporation (QTC) (AA+/Aa1) priced an increase to its September 2016 domestic floating-rate note. According to KangaNews data, this is the first public tap to the line which was introduced on September 10 2013.