News
On 6 September, Metlifecare revealed plans for a new seven-year, NZ$75-100 million (US$47.8-63.7 million) deal, offered to New Zealand retail and institutional investors. The transaction is expected to launch on 16 September. Westpac Banking Corporation New Zealand Branch is arranger and joint lead manager alongside Deutsche Craigs, Forsyth Barr and Jarden Securities.
On 5 September, Firstmac mandated J.P. Morgan and Westpac Institutional Bank to engage investors for a potential prime residential mortgage-backed securities (RMBS) deal.
The securitisation of a pool consisting solely of nonresident mortgages priced by Columbus Capital (Columbus) on 30 September is a world-first deal of this type, its arranger says. Assuaging investor and ratings agency concerns on cross-border risk was key to getting the deal off the ground, while the transaction’s success makes issuer and arranger confident there is a robust market for the product.
On 5 September, Housing New Zealand (Housing NZ) (AA+ by S&P) mandated ANZ and Westpac Banking Corporation New Zealand Branch to arrange a global investor conference call on 9 September regarding a potential tap of either or both its existing lines maturing June 2025 and October 2028.
On 5 September, Commonwealth Bank of Australia (CommBank) (AA-/Aa3/AA-) mandated a new tier-two, US dollar benchmark deal. The transaction is to be offered in 15-year non-call 10-year and 20-year bullet formats, with respective initial price guidance of 230 and 190 basis points area over US Treasuries.
The Australian Prudential Regulation Authority (APRA) determined on 9 July that Australia’s major banks will need to increase their capital ratios by 3 per cent of risk-weighted assets (RWAs) by 2024 to satisfy total loss-absorbing capacity (TLAC) equivalent requirements. How and where the major banks raise the capital will have ripple effects in the market.
Almost without comment, the Australian dollar market is showing signs of evolving to a new phase of maturity. Despite notable headwinds, a look beneath the surface of deal volume clearly indicates depth and breadth of demand that puts historical norms into the shade. Supply is surely the only thing holding back the emergence of genuine, sustainable credit diversity.
KangaNews and National Australia Bank’s Fixed Income Beyond the Institutional Sector Summit returned to Sydney on 1 August. Agenda discussions focused on the future economy and what investors need to do to adapt to a rapidly changing world, with perspectives from a stellar range of speakers spanning the business and market universe.
Despite increasing speculation about further stimulus in Australia as the cash rate continues to fall, most analysts believe it is unlikely the Reserve Bank of Australia (RBA) will employ QE this economic cycle. However, this has not stopped the spectre of QE from looming on the horizon as rates get ever closer to the zero lower bound (ZLB).