News
The start of 2019 marks an interesting juncture for Australia’s government-sector borrowers, characterised by falling sovereign issuance, heightened market volatility and the emergence of sustainable debt as a regular funding option. KangaNews gathered the market’s key players at a roundtable discussion in Sydney to exchange views on the outlook.
On 13 February, Newcastle Permanent Building Society (NPBS) (BBB/A3) launched a minimum A$100 million (US$71 million) two-year floating-rate note (FRN) domestic transaction. The forthcoming deal has indicative price guidance of 115 basis points area over three-month bank bills and is expected to price on the day of launch. ANZ and Westpac Institutional Bank are joint lead managers.
On 12 February, South Australian Government Financing Authority (SAFA) (AA+/Aa1) revised price guidance for its new May 2030 select line transaction to 75 basis points over EFP, equivalent to 72.4 basis points over Australian Commonwealth government bond. The syndicated transaction launched earlier the same day, with indicative price guidance in the area of 75-77 basis points over EFP.
Newcastle Permanent Building Society (NPBS) (BBB/A3) revealed plans for a potential benchmark two-year domestic deal on 12 February. ANZ and Westpac Institutional Bank have been mandated as joint lead managers.
On 12 February, South Australian Government Financing Authority (SAFA) (AA+/Aa1) launched a new May 2030 line via syndication. The forthcoming transaction has indicative price guidance of 75-77 basis points area over EFP, equivalent to 72.35-74.35 basis points area over Australian Commonwealth government bond.
National Australia Bank (NAB) launched an Australian dollar additional tier-one (AT1) capital transaction on 11 February, its first in more than two years. The deal’s arranger predicts robust demand despite various headwinds, based on recent secondary-market activity and appropriate primary-market pricing.
On 11 February, Commonwealth Bank of Australia (CommBank) launched a refinance of the Class A3 notes from its Medallion 2014-1 residential mortgage-backed securities (RMBS) transaction. The self-led deal is capped at A$300 million (US$213.1 million) and is expected to price on or before 14 February.
On 11 February, National Australia Bank (NAB) launched its additional tier-one (AT1) notes transaction, NAB Capital Notes 3. The offer is expected to raise A$750 million (US$532.7 million), with the ability to accept more or less. The forthcoming deal has an indicative margin of 400-420 basis points over three-month bank bills. The final margin will be announced following a bookbuild, expected on 18 February.
On 11 February, Liberty Financial (Liberty) (BBB- by S&P) revealed plans to meet fixed-income investors regarding a potential three-year Australian dollar denominated deal. The meetings will commence on 19 February and will be arranged by joint lead managers, National Australia Bank and Westpac Institutional Bank.
On 11 February, Westpac Banking Corporation (Westpac) launched its residential mortgage-backed securities (RMBS) transaction, WST 2019-1. The forthcoming deal has indicative total volume of A$1 billion (US$709.2 million) and is expected to price on 15 February. Westpac Institutional Bank is arranger for the transaction.
Canadian Imperial Bank of Commerce Australian Branch (CIBC Australia) (A+/Aa2/AA-) launched a new, Australian dollar denominated one-year floating-rate note (FRN) transaction. The forthcoming transaction has indicative price guidance of 55 basis points over three-month bank bills. HSBC, National Australia Bank and Westpac Institutional Bank are joint lead managers.