News
The Reserve Bank of New Zealand (RBNZ) has added a corporate and asset-backed securities (ABS) funding facility to the suite of operations it is implementing to improve domestic liquidity conditions amid COVID-19 related volatility.
As the world scrambles to battle the COVID-19 pandemic, markets are tasked with sorting out how measures to fight the virus will affect economies and finding their best path forward. A panel of market participants from New Zealand, convened via teleconference, agree the country is in a better position than almost anywhere but acknowledge that the outsized influence of global markets on the local economy – and the scale of economic support programmes – make for a precarious future.
Firstmac reopened the Australian securitisation market at the end of the final full week in March, with a A$1 billion (US$611.5 million) residential mortgage-backed securities deal supported by the Australian Office of Financial Management's structured finance support fund. All other antipodean markets remained quiet, but central banks on both sides of the Tasman Sea purchased extensively in government bond markets.
On 27 March, Firstmac printed the Australian market’s first securitisation transaction to be supported by the Australian Office of Financial Management (AOFM)’s A$15 billion (US$9.2 billion) structured finance support fund (SFSF). The SFSF is being implemented to support nonbank financial institutions and smaller authorised deposit-taking institutions through any funding stress resulting from the COVID-19 crisis.
On 27 March, Firstmac launched its prime residential mortgage-backed securities (RMBS) transaction, Firstmac Mortgage Funding Trust No. 4 Series 1-2020. The deal has indicative total volume of A$880 million (US$534.2 million), with the potential to upsize to A$1 billion. Pricing is expected on the day of launch, according to arranger J.P. Morgan, which is also lead manager alongside ANZ, National Australia Bank and Westpac Institutional Bank.
The following interview is with an Australian-based funding executive at a nonbank financial institution. It was conducted on 20 March 2020.
On 26 March, Firstmac revealed plans for a potential Australian dollar denominated, prime residential mortgage-backed securities (RMBS) deal. ANZ, J.P. Morgan, National Australia Bank and Westpac Institutional Bank have been mandated to engage investors.
The following interview is with an Australian-based debt capital markets originator. It was conducted on 19 March 2020.
The Reserve Bank of Australia (RBA) extended its purchasing programme into semi-government bonds on 25 March. Despite the RBA buying across the sector, however, most semi-government yields ended the day wider.
The following interview is with an Australian-based fixed income investor. It was conducted on 19 March 2020.
The early signs for the Reserve Bank of Australia (RBA)’s asset purchasing have been positive, analysts say, and three-year government bond yield is already heading towards its target. The reserve bank has also begun buying further out along the curve. Attention is focused on longer-dated performance, along with potential semi-government bond purchases.
The following interview is with a funding executive at a European issuer in the supranational, sovereign and agency sector. It was conducted on 19 March 2020.