News
National Bank of Abu Dhabi (NBAD), which debuted as a Kangaroo issuer on February 28, says engagement with domestic investors is key to the diversification it hopes to achieve by becoming a repeat borrower in the Australian market. The bank had been looking at the Kangaroo market for two years prior to issuing its first deal, waiting until it was comfortable it would achieve at least 50 per cent take up from local buyers in its debut.
Diversity was the key theme of Australasian issuance in the past week, with notable transactions including corporate deal flow in Australia and New Zealand and a rare Middle Eastern-issuer Kangaroo. Supply volume remained limited, however, with just a smattering of small high-grade transactions in Australia and no other primary market movement in New Zealand.
Wesfarmers (A-/A3) priced a new domestic bond transaction on March 1, selling its A$350 million (US$358.1 million) new seven-year issue at an indicative margin of 115 basis points over semi-quarterly swap. The issuer says it approached the market with a limited volume deal and attracted a strong book predominantly comprising Australian domestic investors.
On March 1, Tasmanian Public Finance Corporation (Tascorp) (AA+/Aa1) priced its sixth-ever syndicated bond transaction with the placement of a new March 2022 issue. According to KangaNews data Tascorp has syndicated at least one bond deal a year since 2009, most recently issuing a A$400 million (US$409.3 million) tap to its 2017 line in December last year.
The NZ$650 million (US$536.4 million) Kauri deal priced on February 19 by International Finance Corporation (IFC) – the market's largest-ever single transaction – was boosted by an increased bid from Asia, the borrower says. In total, 49 per cent of the deal was bought by Asian investors with 47 per cent going to New Zealand and the balance to Europe.
The New Zealand government has published the last of six instalments of its Business Growth Agenda report, focusing on the goal of building the country's capital markets. The report, which was overseen by a group of four ministers including minister of finance, Bill English, emphasises the importance of well-functioning capital markets for economic growth and targets a reduction in the premium New Zealand borrowers pay for debt.
National Bank of Abu Dhabi (NBAD) (A+/Aa3/AA-) mandated a new five-year Kangaroo transaction on February 27, in what KangaNews data suggests will become not only the first Kangaroo from an Abu Dhabi issuer but also just the second from a borrower in the Middle East. Emirates Bank International priced A$250 million (US$255.6 million) of three-year notes in November 2006.
Japanese fund managers have confirmed analysis from the Australian market identifying selling of Australian dollar securities by investors in a number of sectors in Japan. The scale of divestment has been significant and appears likely to continue for the near term, but the latest information from analysts and Japanese investors suggests core AUD positions will be maintained.