News

Australian Prime Property Fund Retail (APPF Retail) has priced an A$350 million three-tranche fixed-rate senior unsecured domestic notes. The deal was launched this morning as a five-year and seven-year dual-tranche issue. At pricing, an A$40 million 10-year third tranche was also issued.

The Australian Office of Financial Management (AOFM) published its annual report for the 2011/12 financial year on October 30, which the agency used as an opportunity to highlight strong demand, tightening yields and extended tenor as key successes for the Commonwealth government securities (CGS) market over the period. The AOFM says 10-year Treasury bond yields declined by more than 200 basis points during 2011/12.

AMP Bank has announced to acquire A$74 million (US$76.5 million) of its 4.5% fixed rate senior bonds maturing on February 13 2013. Noteholders can transfer the notes in minimum parcels of A$500,000. 

Asian Development Bank (ADB) (AAA/Aaa) has priced a new four-year Kangaroo line on October 30. The deal is ADB's fifth of 2012: the supranational's previous deal priced on September 25 with a volume of A$300 million (US$310.8 million) priced at 77.25 basis points over the July 2022 ACGB and 14 basis points over swap.

There was some financial institutions action in the AUD market this week with J.P. Morgan pricing a A$900 million 5-year dual-tranche Kangaroo and BEN pricing a A$400 million 3-year domestic debut as a merged entity. NZDMO sold a NZ$2.5 billion indexed syndicated issue successfully. AOFM updated issuance forecast post MYEFO. Ratings outlooks on NSW and WA were also surprisingly revised to negative.

Domestic securitisation issuers are concerned that APRA's suggestion of limiting securitisation deals to just two tranches will limit the pool of investors interested in Australian product. And at least one domestic institutional investor agrees.

In its half-year results presentation, released on October 26, Macquarie Group disclosed a capital surplus of A$2.1 billion (US$2.2 billion) under Australian Prudential Regulation Authority (APRA) Basel III standards. Macquarie Group says that surplus would rise to A$3.4 billion under "harmonised" Basel III standards as APRA deducts a number of items including equity investments, of which the group has A$800 million.

Investa Office Fund (IOF) (BBB+) has priced its debut issue into the domestic market on October 26, with a five-year line. The senior unsecured deal was announced with a minimum volume of A$100 million (US$103.5 million) and indicative pricing around 210 basis points over swap.

Standard & Poor's (S&P) revised the outlook on its AAA ratings on the Australian states of New South Wales (NSW) and Western Australia (WA) to negative on October 25. The rationale for the outlook changes appears to be specific rather than systemic: the rating agency has a different rationale for the outlook on each state, and on the same day also affirmed its AAA stable rating on Victoria.

In its annual results, released on October 25, ANZ Banking Group (ANZ) disclosed an ongoing reduction in the proportion of its funding sourced in term debt markets and a concurrent increase in the size of its liquid assets pool. The proportion of term debt issued in ANZ's domestic markets has increased, largely at the expense of European issuance.