News
New South Wales Treasury Corporation (TCorp) has revealed a projected funding requirement of A$11.5 billion (US$12.4 billion) for the 2011/12 financial year, with a slight increase in the headline total being caused by a marginal increase in maturing bond volume and a lower level of pre-funding than last year. The state treasury corporation also disclosed plans to add a new, long-dated benchmark in the next 12 months.
On June 10, Investec Bank Australia (Investec Australia) (Baa2/BBB) finalised the buyback of the fixed rate tranche of its February 2012 government-guaranteed line, repurchasing A$128.4 million (US$136.6 million) of the A$200 million volume. The buyback priced at a margin flat to semi-quarterly swap or a premium of around 16 basis points to the closest maturity Australian government bond.
ING Bank Australia (ING) completed a A$800 million (US$847.8 million) residential mortgage-backed securities (RMBS) deal on June 10. The deal was upsized from a launch volume of A$750 million, and marks ING's second foray into the domestic securitisation market.
Year to date, June will be the biggest month in terms of upcoming maturities. While most investors are not concerned regarding the outflow of bonds from their portfolios, they still express a general dissatisfaction with what is currently being offered in the domestic market.
Treasury Corporation of Victoria (TCV) (AAA/Aaa) launched and priced a new November 2026 domestic transaction inside a day on June 1. The issue has a A$220 million (US$236.3 million) volume - slightly higher than the launch size of A$200 million. The deal - which was solely led by UBS Investment Bank - will extend the state funding agency's domestic curve: its longest-dated line on issue is a December 2024 maturity issued in October 2010.
KfW Bankengruppe (KfW) (AAA/Aaa/AAA) launched and priced a A$250 million (US$268.6 million) increase of its June 2014 Kangaroo maturity on June 1. The tap takes the amount outstanding in the line to A$1.25 billion, having been inaugurated in May 2009 and tapped two months later. The top-up is KfW's third Kangaroo deal inside a month, with its most recent issue – a tap to its January 2016 maturity – pricing on May 19.
DNB NoR Boligkreditt AS (DNBB) issued its inaugural Kangaroo covered bond transaction on June 1. The June 2016 transaction has a volume of A$600 million (US$644.5 million) and priced at 85 basis points over semi-quarterly swap.
On June 1, Transurban Finance Company (Transurban) (A-/Baa1/A-), the financing entity of Transurban Group, issued a new A$200 million (US$215 million) June 2016 domestic issue. The proceeds of the notes, combined with undrawn bank lines, will be used to repay an upcoming A$300 million September 2011 maturity. Investors holding the existing maturity have also been given the opportunity to redeem these notes early, at a rate of par plus accrued interest to the date of redemption.
Australian Capital Territory (ACT) (AAA) launched and priced its inaugural MTN issue on May 31, issuing a A$300 million (US$321.2 million) seven-year maturity. It achieved a margin of 56 basis points over the January 2018 ACGB.
European Investment Bank (EIB) (AAA/Aaa/AAA) is the fourth supranational, sovereign and agency (SSA) borrower to access the Kauri market in two weeks, completing a NZ$200 million (US$164.4 million) 10-year floating rate note (FRN) issue on May 30.
Asian Development Bank (ADB) (AAA/Aaa/AAA) completed a A$650 million (US$1.025 billion) increase of its May 2014 Kangaroo on May 31. The tap is the first increase of the line, which was introduced in May 2009 at a volume of A$375 million and priced at a margin of 75 basis points over swap.
On May 27 Moody's Investors Service (Moody's) downgraded the long-term ratings of New Zealand's four major banks, following the May 18 announcement that their respective parent banks had been downgraded by the rating agency.