News
A day after its A$600 million fixed and floating rate bond issue Rabobank Nederland (AAA/Aaa) (Rabobank) increased both the fixed and floating rate note (FRN) tranches by A$100 million each, to bring the total size of the fixed tranche to A$300 million and the FRNs to A$500 million. The increases priced at the same level as the inaugural bonds - 130 basis points over swap (fixed) and the bank bill swap rate (FRNs).
On February 2 Westpac Banking Corporation (Westpac) (AA/Aa1) stunned the market with the biggest-ever Samurai bond issued by an Australian bank. The Australian major issued a total of ¥245.3 billion (US$2.7 billion) in Samurai and euro-yen format. The Samurai bond is the first to be issued in 2009 and is also the first ever sovereign-guaranteed Samurai bond.
On February 3 Rabobank Nederland Australia Branch (Rabobank) (AAA/Aaa) proved that domestic investors have appetite to buy non-sovereign guaranteed bank bonds - albeit from the only bank in the world with a standalone triple-A rating.
On February 2 Investec Bank (Australia) Limited (Investec) (Baa1/BBB) priced A$400 million of three-year fixed and floating rate notes (FRNs) guaranteed by the Australian sovereign. This is the first time the issuer has been present in the Australian bond market since it priced three- and five-year vanilla bonds in June 2007.
In the first KangaNews league tables for 2009 UBS has taken a commanding lead over the field in volume of transactions excluding self-led deals, with its figure of A$2.05 billion (US$1.32 billion). The Swiss bank’s highlights include acting as joint lead manager on ANZ Banking Group (ANZ)’s A$2.6 billion 2014 benchmark and Bank of Queensland’s A$500 million 2011 trade.
The retail deal pipeline remains strong in New Zealand at the start of 2009 with market participants anticipating strong demand for the transaction Fonterra (A+/AA-) announced at the end of last year and a number of additional deals in the offing, including a possible return to the hybrid market by Bank of New Zealand (AA/Aa2) (BNZ).
The flood of government-guaranteed issuance from Australian banks has slowed in recent days, with just under US$1 billion equivalent priced in the week ending January 23 – down from US$5.08 billion the week before and US$12.41 billion in the first week of the new year.
TD Securities (TD) will no longer have an origination, sales or trading facility in Sydney as the bank has revealed all these functions will be moved to Singapore "in the coming weeks". The firm has yet to confirm details of staffing changes or how the new setup will be structured, but market sources have cast doubt in its ability to maintain its origination performance in Australia with no local facility.
Demand for Australian government guaranteed bonds continued on January 20 as Bank of Queensland (BBB+/A2/BBB) (BOQ) became the first triple-B rated issuer to price a deal under the sovereign scheme, bringing A$500 million (US$331.15 million) of 2011 paper to its home market.
Australian banks had by January 14 conducted the equivalent of over US$30 billion in term borrowing under the conditions of their government's guarantee scheme since the first such deals were brought to market in early December 2008.
Westpac Institutional Bank (Westpac)’s strategic decision to separate its rates and credit operations has led to a number of changes in its credit trading business in Australia, New Zealand and the UK, including a brace of new hires.
The Australian government guarantee scheme came into effect on November 28 2008. Australian banks started issuing with government guarantees onDecember 8 2008. By the end of the scheme on March 31 2010 the amount of long-term debt issued by Australian banks under the guarantee scheme amounts to the equivalent of over US$130 billion at current exchange rates. The main currency of issuance has been USD, with over US$61.9 billion issued. This is followed by AUD, with A$56 billion issued - predominantly in the domestic Australian market. The third-biggest issuance currency is Yen, with US$14.1 billion equivalent issued in the euro-yen and Samurai bond markets. Below is the final tally of government-guaranteed deals from Australian banks, gleaned from KangaNews contacts as well as the Australian government's website on guaranteed liabilities.