News
Macquarie Group completed the bookbuild for its additional tier-one (AT1) capital deal, Macquarie Group Capital Notes 5 (MCN5), late in the day on 19 February. The margin has been set at 290 basis points over three-month bank bills, below the indicative range of 300-320 basis points, and the volume upsized to A$550 million (US$433.3 million) from A$500 million, with the ability to raise more or less.
The third week of February in Australasian markets was highlighted by the return of benchmark, senior-unsecured, bank transactions, from Suncorp-Metway and Westpac New Zealand.
Nearly a year since the Australian Office of Financial Management (AOFM) deployed its first investment from the Australian Business Securitisation Fund (AOFM), the government debt-management agency is seeking to reinvigorate its mandate to develop the SME financing market. COVID-19 forced a focus on emergency liquidity mechanisms and put the ABSF on hold, but the AOFM believes the experience may now allow it to fast-track its longer-term ABSF aims.
On 19 February, Western Australian Treasury Corporation (WATC) (AA+/Aa1) revealed plans for a new October 2030, syndicated, domestic, benchmark transaction. The deal is expected to launch in the week beginning 22 February, according to lead managers ANZ, BofA Securities, Deutsche Bank and National Australia Bank.
On 18 February, Asian Development Bank (ADB) (AAA/Aaa/AAA) launched a new, seven-year Kangaroo bond with indicative price guidance of 21 basis points area over semi-quarterly swap and 21.9 basis points area over Australian Commonwealth government bond. The minimum A$300 million (US$232.5 million) deal is expected to price on the day after launch and is being led by RBC Capital Markets, Nomura and TD Securities.
On 18 February, Aurizon Finance (BBB+/Baa1) mandated MUFG Securities, National Australia Bank and SMBC Nikko to arrange a series of investor calls beginning 23 February regarding a potential seven-year or longer, Australian dollar denominated transaction.
Suncorp-Metway’s return to senior-unsecured issuance revealed the scale of pent-up demand for Australian financial institution (FI) credit even at record tight pricing. After a period of virtually no senior bank issuance, Suncorp expects FI issuance to pick up during 2021 as credit growth and savings drawdowns accelerate.
New Zealand domestic corporate issuance kicked off for 2021 with a debut from Arvida Group. Deal sources say COVID-19 and a crowded market in the second half of 2020 delayed a transaction that had been planned for last year, but that conditions remain receptive in the new year even for an unrated name like Arvida.