News
On 11 December, following the New Zealand government’s half year economic and fiscal update, New Zealand Debt Management (NZDM) revealed an unchanged core Crown borrowing programme for the 2019/20 financial year, at NZ$10 billion (US$6.6 billion). Around NZ$500 million of the issuance programme is expected to be undertaken in inflation-indexed bonds.
On 11 December, SEEK launched a 6.5-year non-call 3.5-year (6.5NC3.5), Australian dollar denominated, subordinated, floating-rate note (FRN) transaction. The forthcoming deal is being marketed at 375 basis points area over three-month bank bills. Pricing is expected on the day of launch, according to joint lead managers ANZ, HSBC and National Australia Bank.
South Australian Government Financing Authority (SAFA) (AA+/Aa1) launched a new A$100 million (US$68.3 million), one-year, Australian Overnight Index Average (AONIA)-linked floating-rate note (FRN) transaction on 10 December. Indicative price guidance for the forthcoming deal, which is expected to price on the day after launch, is 37-40 basis points area over the daily compounded AONIA. UBS is leading.
Investor diversity was front of mind recently for National Australia Bank (NAB) with two esoteric capital transactions in as many days. The major banks face increased capital requirements and NAB says developing new avenues to achieve funding and investor diversity is crucial.
On 10 December, South Australian Government Financing Authority (SAFA) revised its 2019/20 funding requirement to A$3 billion (US$2 billion) from A$3.2 billion, following the South Australian government’s mid-year budget review. The reduction reflects an improvement in the nonfinancial public sector net debt position of A$186 million.
On 10 December, Seek mandated ANZ, HSBC and National Australia Bank for a 6.5-year non-call 3.5-year (6.5NC3.5), Australian dollar denominated, subordinated, floating-rate note transaction. Indications of interest for the deal are being taken at 375 basis points area over three-month bank bills.
On 10 December, Fox Symes launched a nonconforming residential mortgage-backed securities (RMBS) deal, Fox Symes Home Loans 2019-1 PP Trust. Total capped volume for the forthcoming deal is A$200 million (US$136.5 million), with pricing expected on or before 12 December. Westpac Institutional Bank is arranger and lead manager.
In November 2019, KangaNews spoke to bank funders from Asia, Australia, Europe, Japan and North America – all of them active in the Australian dollar market – about market conditions, executing more diverse funding plans, sustainable debt and the role of noncore currencies. The consensus is that issuance diversity will play a greater role now new regulatory capital settings are largely bedded in.
Key data and information on 24 global bank issuers active in the Australian dollar market. The issuer section includes funding strategy information as well as corporate debt data on profiled borrowers.