News
On May 6 the Australian Prudential Regulation Authority (APRA) released a second consultation paper covering Australia's Basel III liquidity reforms, revealing it does not plan to follow the lead of the Basel Committee on Banking Supervision (BCBS) by easing the requirements on banks – or the timeline for their implementation.
Diverse deal flow has picked up as one residential mortgage-backed securities (RMBS) and four vanilla domestic deals priced in Australia while one deal priced in New Zealand. The most significant deal, which also closed the week, was Lend Lease group's debut dual-tranche issue to the Australian domestic market.
On May 3, Lend Lease Group priced a new dual tranche deal in the Australian market, the issuer's first-ever domestic bond issue. The company has previously issued in Australia through offshore entity Lend Lease (US) Finance, but not since it placed a six-year Kangaroo deal with a volume of A$500 million (US$512.62 million) in November 1999.
In its half-year results announced on May 3, Westpac Banking Corporation (Westpac) disclosed a further small increase in the deposit portion of its overall funding mix. At the end of March 31 this year, 59 per cent of Westpac's funding book was made up of customer deposits, up by 1 per cent over the six month period.
The announcement in early April of a massive programme of quantitative easing by the Bank of Japan (BoJ) is expected to suppress local bond yields even further and consequently force Japanese funds into international investments. But Japanese market watchers say that move has yet to begin, and the falling yen continues to cause repatriation of assets.
GE Capital Australia Funding (GE Capital) (AA+/A1) priced a new November 2016 maturity domestic transaction on May 2, in what was the issuer's third visit to the Australian market this year. GE Capital placed a total of A$750 million (US$770.7 million) in a five-year fixed- and floating-rate deal in January, then added A$200 million in a 2022 maturity fixed-rate note in March.
On May 2, IMB priced its first securitisation issue since 2011, following disclosure of expected ratings on the bank's Illawarra Series 2013-1 Trust residential mortgage-backed securities (RMBS) transaction on April 29.
With a third of the year over ANZ has so far maintained its recent record as the leading intermediary in the Australian and New Zealand bond markets. According to KangaNews's league tables, ANZ lead managed more deal volume in 2013 to the end of April than any other bank when issuance from domestic and international borrowers is taken into account.
Half year results released by ANZ Banking Group (ANZ) on April 30 show an increasing gap between the bank's cost of deposit funding and wholesale margins, with the bank paying around 50 basis points more for deposits than for three-year wholesale debt by the end of March this year. Overall, ANZ's funding mix remained largely stable compared with six months previously.