News
Japanese investor participation has supported the long-end Kangaroo market for supranational, sovereign and agency issuers in recent years. Deal flow has been more focused on mid-curve issuance in 2019. However, Bart van Dooren, head of funding and investor relations at BNG Bank (BNG) in The Hague, says long-end opportunities persist and bespoke private placements (PPs) can still be compelling opportunities for Japanese investors.
Japanese investors have come to represent a significant portion of Australian major-bank transaction books across currencies and products. Westpac Banking Corporation (Westpac)’s Sydney-based head of group funding, Alex Bischoff, discusses the bank’s evolving relationship with this investor base.
Australian market deal flow during the third week of October was highlighted by Australian Capital Territory's A$1 billion (US$683.2 million) 12-year syndicated deal. Meanwhile in securitisation, Mercedes-Benz Financial Services Australia priced its inaugural A$580.1 million auto asset-backed securities deal and Resimac printed a A$1 billion residential mortgage-backed securities transaction.
Consistent Australian dollar issuance, as well as further deals from its Japanese peers, resulted in significant domestic investor support for Sumitomo Mitsui Financial Group (SMFG)’s latest transaction. Deal sources say technical factors on the buy and sell side are proving supportive for global financial institution (FI) issuance in Australian dollars.
The process of deal execution, like so many others in contemporary capital markets, has been reshaped by regulation. In a world where banks have less facility to provide transaction information to investors, L-Bank is taking all available steps to bridge the gap itself – with positive connotations for investor response and deal outcomes.
The intention of rate cuts is to stimulate confidence, spending and investment – and thus economic growth. The Reserve Bank of Australia (RBA) has now fired virtually all its bullets, but the early signs are that the only significant impact may be to refuel the housing boom.
Corporate borrowers are, in the main, in the earliest stages of getting to grips with the consequences of global interbank offered rate (IBOR) transition. Chatham Financial (Chatham)’s Australian team explains the key issues and why planning a response is increasingly important.
Green, social and sustainability (GSS) bonds opened the door to a more active sustainable debt market in Australia. But they are only the first step. In a roundtable hosted by ANZ and KangaNews in September, credit-market participants looked at the full scope of potential growth in the sustainable-debt universe, including the role of new products in the loan and bond space, and the end goals of this type of financing.
Credit-wrapped bonds were relatively common in Australia before the financial crisis but have virtually disappeared since. Assured Guaranty has a revived business model, an Australian cooperation agreement with independent arranger and adviser DTW Capital Solutions as exclusive origination consultant, and proof of concept in local deals. The firm believes it has a new value proposition for Australian borrowers.
Japanese investors have been among the biggest supporters of Australian dollar and Australian-origin issuance in the rates, credit and structured-finance markets. In their annual roundtable, conducted in Tokyo in September, KangaNews and Mizuho Securities (Mizuho) found the Japanese buyer base is still supportive of Australian issuance but declining yield is a tough hurdle to overcome.
The seventh annual KangaNews New Zealand DCM Summit took place in Auckland on 22 August at a fascinating juncture for the local debt market. Discussion focused on forthcoming changes to bank-capital requirements and the finalisation of a bank securitisation regime locally, the global context of trade wars, the low interest-rate environment and major capital-market upheaval.
The fallout from and possible escalation of the ongoing US-China trade war and the global lowering of rates pose significant risks to the New Zealand economy, as they do to so many others. Domestic data have yet to take a drastic downward direction but that has not stopped a generally negative outlook.