News
On 19 September, Svenska Handelsbanken (AA-/Aa2/AA) launched a new, five-year senior-unsecured Kangaroo deal, to come in either or both fixed- and floating-rate formats. Indicative price guidance for the forthcoming transaction is 100 basis points area over swap benchmarks. Pricing is expected on or before the day after launch, according to lead managers Citi, TD Securities, UBS and Westpac Institutional Bank.
AT&T’s debut Kangaroo deal, which priced on 14 September, marked the return of US corporate issuance to the Australian market for the first time this year. Deal sources say cash repatriation by major US corporate names has drastically reduced offshore issuance from US credits globally, but insist AT&T’s A$1.3 billion (US$949.2 million) result demonstrates that Australia remains open for business to this type of borrower.
On 18 September, Firstmac mandated ANZ, National Australia Bank and Westpac Institutional Bank to engage investors regarding a potential Australian dollar denominated prime residential mortgage-backed securities (RMBS) transaction.
National Australia Bank (NAB) (AA-/Aa3/AA-) launched a new, benchmark five-year senior-unsecured domestic deal on 18 September. The self-led transaction is being marketed at 94 basis points area over swap benchmarks and is expected to price on the day of launch.
On 18 September, Auckland International Airport (Auckland Airport) (A- by S&P) revealed plans for a potential six-year domestic deal, to be offered to New Zealand retail investors and to institutional investors. Full details will be released prior to the offer opening, expected on or around 24 September. ANZ and Westpac Banking Corporation New Zealand Branch are joint lead managers.
On 17 September, Banque Fédérative du Crédit Mutuel (BFCM) (A/Aa3/A+) mandated HSBC and National Australia Bank for a potential Kangaroo senior-preferred transaction.
On 17 September, Australian Office of Financial Management (AOFM) (AAA/Aaa/AAA) launched a new, benchmark treasury indexed bond (TIB), due February 2050, by syndication. Initial price guidance for the forthcoming deal is 9-13 basis points over the August 2040 TIB, which equates to -150 to -146 basis points versus the implied yield for the December 2018 10-year treasury bond futures contract. Pricing is expected on the day after launch.
Market conditions in Australia have become harder in 2018 across all sectors, and arguably more so for supranational, sovereign and agency (SSA) issuers given cross-currency basis-swap economics. Borrowers say demand is down, but they remain firmly committed to the Kangaroo and Kauri markets and have found plenty of opportunities to fund.
National Australia Bank (NAB) (AA-/Aa3/AA-) mandated a five-year senior domestic benchmark on 17 September. The forthcoming self-led deal has price guidance in the area of 94 basis points over swap benchmarks and is expected to launch and price “in the near future”.
In August 2018, KangaNews asked supranational, sovereign and agency (SSA) borrowers to respond to a survey of their global issuance patterns and funding profiles – and 27 of the 32 profiled in this yearbook responded. Despite headwinds, survey responses generally indicate optimism about the Australasian capital markets with views on global demand particularly encouraging.