News

In its second deal of 2012, ING Bank Sydney (A+/A2/A+) launched a new three-year transaction on August 21, which priced on August 22. The Sydney branch last came to the domestic market in April this year with a one-year transaction for a total of A$100 million (US$104.4 million), priced at 100 basis points over the bank bill swap rate.

In its first Kauri deal of 2012, International Finance Corporation (IFC) (AAA/Aaa) priced a new five-year line on August 21. The deal is the 10th Kauri overall for 2012 and the first to price since the end of July; it takes cumulative Kauri volume to NZ$2.15 billion (US$1.74 billion) for the year to date.

Preliminary ratings have been assigned to a new asset-backed securities (ABS) transaction to be issued by Macquarie Leasing (Macquarie). The deal, which will be the third to be issued off Macquarie's Smart programme this year, is the issuer's first securitisation based solely on equipment lease receivables according to a preliminary report released by Fitch Ratings (Fitch) on August 20.

Commonwealth Bank of Australia (CommBank) adjusted its trading income downwards by A$90 million (US$94.2 million) in the second half of its 2011/12 financial year as a result of credit valuation adjustment (CVA) expense. Over the full financial year the impact was negative A$127 million, while the bank was able to report a positive impact of A$103 million from CVA movements in 2010/11.

Subdued deal flow was the most notable characteristic of a week in which Australian corporate reporting season got into full swing. Just a single transaction priced in the Australian domestic market, while Kangaroo and securitisation markets remained shuttered. No new transactions were publicly priced in New Zealand, from either domestic or international issuers.

Australia's Export Finance & Insurance Corporation (EFIC) (AAA) issued US$40 million of callable, capped floating rate notes on August 9. According to Chris Collard, director, treasury at EFIC in Sydney, the deal was executed in response to reverse enquiry and the proceeds were swapped to floating rate USD at a margin below six-month Libor.

GE Capital Australia (GE Capital) (AA+/A1) priced its second domestic transaction of 2012 on August 16, placing a new five-year issue with total volume of A$500 million (US$525.6 million). GE Capital last visited the Australian market in May, when it sold A$410 million in a February 2014 maturity floating-rate note.

On August 14, Goodman Funds Management (GFM), a subsidiary of Goodman Group (Goodman), proposed an increase to the margin on the Goodman PLUS hybrid securities it issued in 2007 – in lieu of their redemption at the first remarketing date next year. If the proposal is accepted by securityholders, the margin on the A$325 million (US$341.8 million) hybrid will be increased to 390 basis points over bank bills from the current 190 basis points.

Australia's latest retail corporate transaction launched on August 13 as Crown (BBB/Baa2/BBB) confirmed its plans to issue around A$400 million (US$421.9 million) of subordinated notes. As with the retail transaction launched the previous week by APA Group, the shareholder and general offer of Crown's notes will be open to participants in both Australia and New Zealand.

Following a flurry of securitisation activity at the back end of the previous week, the Australian new issuance market has quietened with just three new deals coming to market – two of them Kangaroos. New Zealand saw one new transaction complete, although there has also been retail deal activity on both sides of the Tasman as APA Group and TrustPower both moved towards issuance.

ANZ Banking Group (ANZ) (AA-/Aa2/AA-) priced its second transaction in the Dim Sum market on August 9, extending the tenor it achieved on its first issue in December 2010 and significantly upping the volume placed. The new deal was for RMB1 billion (US$157.3 million) of three-year notes with a 2.9 per cent coupon, compared with ANZ's debut offering of RMB200 million of two-year paper.