News

A holistic approach to integrating environmental, social and governance (ESG) factors into credit processes is becoming the norm across the global debt market. Fitch Ratings (Fitch)’s integrated scoring system has been operational for close to six months and Andrew Steel, the rating agency’s London-based managing director and global head of sustainable finance, explains why the agency believes this system could transform ESG investing.

Western Australia (WA) is emerging from a challenging economic period with a much improved state-government balance sheet and signs of a renaissance in business investment and population growth. Ben Wyatt, WA’s Perth-based state treasurer, discusses the economic trajectory and funding options.

At face value, the Australian economy appears to be in relatively good shape with solid if unspectacular growth and low unemployment. But the Reserve Bank of Australia (RBA) is easing already accommodative monetary conditions and there is talk of further stimulatory macroeconomic measures and even QE.

The long-term trend is still in the right direction, but investors and intermediaries in Asia say regional interest in Australia has taken a step back in the past 12 months. There are still many reasons for Australian market participants to maintain and grow their Asian engagement, however.

New capital requirements proposed for banks by the Reserve Bank of New Zealand (RBNZ) are likely to have consequences well beyond the banking sector. Economics in the lending market could be set for change, which may in turn reshape the dynamics of corporate bond issuance in New Zealand.

The state government of Victoria has maintained its commitment to vital infrastructure investment despite softening economic conditions, thanks in part to many years of sound budget management. Tim Pallas, the state’s Melbourne-based treasurer, tells KangaNews how the government will juggle its revenue and spending projections.

KangaNews speaks to Jackie Trad, the state of Queensland’s Brisbane-based treasurer, and Philip Noble, chief executive at Queensland Treasury Corporation (QTC) in Brisbane, about the state’s ambitious infrastructure plan, state finances and goals on the funding side of the balance sheet. The state government is committing to substantial infrastructure investment and will be more active in capital markets as a result of this programme.

Isabel Fernandez, head of wholesale banking at ING Bank (ING) in Amsterdam, spoke exclusively with KangaNews when she visited Australia in May. She shares her aspirations for the bank’s wholesale franchise in Australia, including the emerging role of sustainability-performance-linked loans (SPLs).

New South Wales Treasury Corporation (TCorp) has a 2019/20 funding programme twice the size of the year prior and is changing its issuance and investor-relations strategy as a result. A government commitment to investment in infrastructure is a central driver of the funding need.

Housing New Zealand (Housing NZ) has issued more than half its borrowing protocol limit as well as the largest green, social and sustainability (GSS)-themed bond in New Zealand, despite re-entering the market barely a year ago. Sam Direen, Wellington-based treasurer at Housing NZ, says the issuer’s journey is only just beginning.

BNP Paribas and KangaNews convened their longstanding roundtable for corporate issuers in Sydney in July. Participants share a detailed view of a global market in which liquidity continues to outstrip credit supply by a significant margin – and where issuers hold the whip hand as a consequence. There are still challenges for responsible issuers, however.

European Investment Bank (EIB) is one of the longest-standing and most active supranational, sovereign and agency (SSA) issuers in the Kangaroo and Kauri markets. Global issuers in Australian and New Zealand dollars have been facing some challenges in 2019. But with the support of a growing sustainability programme, EIB’s funding team says it believes Australasian markets will continue to play an important role in the supranational’s bond-issuance mix now and into the future.