News
Australian Financial Group (AFG) priced its second residential mortgage-backed securities (RMBS) issue of 2013 on October 24. AFG 2013-2 Trust has a four -tranche structure and matched its indicative aggregate volume of A$300 million (US$289.8 million).
Treasury Corporation of Victoria (TCV) and Western Australia Treasury Corporation (WATC) both priced public deals in quick succession on October 21 and 22, with significant oversubscription. Both issuers cite the desire to build a curve and strong investor demand for the decision to return to the market. But they add that further issuance depends on how market conditions develop.
On October 23 the Australian Office of Financial Management (AOFM) revealed updated planned issuance of Australian Commonwealth government bonds (CGS) in the current financial year. The issuance schedule has been revised in light of an A$8.8 billion (US$8.6 billion) grant the Australian government has awarded to the Reserve Bank of Australia (RBA).
On October 23, the International Finance Corporation (IFC) (AAA/Aaa) priced an increase to its August 2023 Kangaroo line. According to KangaNews data, the tap is the first increase of the line which was introduced on August 7 this year.
Canadian Imperial Bank of Commerce (CIBC) says its new Kangaroo covered bond, which priced on October 17, was prompted by improved appetite for AUD covered bonds and globally competitive pricing. The issuer says it is very happy with the result, but it had hoped for more development of the covered bond asset class in the Kangaroo market – especially in terms of the real-money investor base.
On October 23, commercial print company PMP (NR) closed its four-year unsecured bond with oversubscribed volume of A$50 million (US$48.5 million), from A$40 million minimum size. Bonds were priced in line with the indicative coupon, at 8.75 per cent.
Western Australian Treasury Corporation (WATC) (AA+/Aaa) priced a new July 2025 maturity domestic line on October 22. According to KangaNews data, WATC priced its previous syndicated domestic deal on October 17, a three-year issue with a volume of A$750 million (US$724.4 million) and pricing of 9 basis points over three-month bank bill swap rate.
On October 21, Treasury Corporation of Victoria (TCV) (AAA/Aaa) priced a new fixed rate November 2017 maturity domestic line. According to KangaNews data, TCV priced its previous syndicated domestic deal on September 6, a 17-year issue with a volume of A$30 million (US$29 million) and pricing of 67.25 basis points over Australian government bonds.
Aurizon Network (BBB+/Baa1) says it selected the local market for its record-breaking capital markets debut because it was competitive with offshore alternatives. Meanwhile, Australia's domestic investors attribute the solid demand with which the deal was met to the relative scarcity of non-financial Australian dollar issuance.
Contact Energy (Contact) has elected to redeem the entire outstanding volume of its domestic hybrid issue, in response to the reduction in equity credit afforded to the instrument by Standard & Poor's Ratings Services (S&P) in April. The Contact hybrid was issued in a NZ$200 million (US$169.9 million) transaction in 2011 and will now be redeemed on its next interest payment date, November 15.