News
Most analysts anticipated the Australian housing market would take a hammering from COVID-19. More than six months into the crisis, house prices have held up better than expected and experience suggests the sector will be among the leaders of a future economic recovery.
Every year, KangaNews hosts Australia’s leading nonbank lenders at a sector roundtable discussion – supported since 2019 by Natixis. In keeping with the unique circumstances of 2020, this year’s roundtable was conducted via videoconference. While market conditions have changed dramatically in the past 12 months, the sector is able to tell the same story of solid funding foundations and sound credit quality.
United Overseas Bank Sydney Branch (UOB Sydney) says it took a bespoke approach to execution in its recent Australian dollar deal by capturing cornerstone bids and then opening the book for a wider trade. The approach resulted in a post-financial-crisis pricing record for any bank issuer including domestic names.
Avanti Finance printed New Zealand’s second residential mortgage-backed securities (RMBS) deal in just over a month, on 9 October – a feat that seemed highly improbable earlier in the year. Sound origination standards and technical tailwinds have caused interest in the asset class to jump, the issuer says.
On 13 October, Zip Co launched its asset-backed securities (ABS) deal, Zip Master Trust Series 2020-1. Indicative total volume for the transaction is A$300 million (US$215.9 million), according to lead manager National Australia Bank.
Mizuho Bank Sydney Branch (Mizuho Sydney) (A/A1) began taking indications of interest for a potential new three-year, Australian dollar denominated transaction on 13 October. Initial price thoughts for the deal is 65 basis points area over swap benchmarks. ANZ, Commonwealth Bank of Australia, Mizuho Securities, National Australia Bank and Westpac Institutional Bank are leading.
On 13 October, Australian Military Bank (Baa1) mandated Westpac Institutional Bank to host an investor call on 15 October regarding a potential domestic, 10-year non-call five-year (10NC5), tier-two, floating-rate note transaction. The deal is expected to be rated Baa3.
On 13 October, Challenger launched Capital Notes 3, a new subordinated, unsecured, perpetual convertible security, seeking to raise approximately A$250 million (US$180.2 million). The indicative margin for the deal is 460-480 basis points area over three-month bank bills. The final margin will be set, following a bookbuild, on 20 October. The offer is expected to open on 21 October and close 13 November.
Late in the day on 12 October, Australian Gas Infrastructure Group (AGIG), on behalf of DBNGP Finance (DBNGP) and Energy Partnership Gas (EPG), announced its results of the consent solicitation process on its outstanding Australian dollar denominated notes.
On 12 October, Firstmac mandated J.P. Morgan and National Australia Bank to engage investors regarding a potential Reg S, prime residential mortgage-backed securities (RMBS) transaction.