News
On 6 October, Queensland Treasury Corporation (QTC) (AA+/Aa1) mandated a new, Australian dollar syndicated benchmark bond. ANZ, Citi, Deutsche Bank and Westpac Institutional Bank are leading the forthcoming 144a-eligible deal, which will have an August 2030 maturity date.
On 5 October, Pepper Australia (Pepper) mandated the refinancing of the class A1-s2 notes of Pepper Residential Securities (PRS) Trust No.15, with a tranche of new class AR-1 notes. The AR-1 notes have indicative volume of A$35.1 million (US$27.5 million), a weighted-average life of 1.7 years and price guidance in the area of 105 basis points over one-month bank bills.
A marginal – but surprising – expansion of the committed liquidity facility (CLF) provided to banks by the Reserve Bank of Australia (RBA) for 2018 could boost demand for CLF-qualifying credit, a Deutsche Bank research note suggests. A concurrent marginal easing of demand for sovereign bonds should easily be offset by expected reduced supply, analysts believe.
On 5 October, Auckland International Airport (Auckland Airport) (A- by S&P) revealed plans to update Australian dollar fixed-income debt investors in a teleconference to be held on 10 October. Commonwealth Bank of Australia and Westpac Institutional Bank are arranging the investor update, which may be followed by an increase to Auckland Airport’s September 2027 Kangaroo bond.
On 3 October, Heritage Bank began marketing an indicative A$500 million (US$390.4 million) residential mortgage-backed securities (RMBS) transaction, HBS Trust 2017-1. Indications of interest are being taken all the way down the capital structure, arranger National Australia Bank and addition lead managers ANZ and Westpac Institutional Bank, add.
The KangaNews-Westpac Corporate Debt Summit returned to Sydney on 13 September, against arguably the most positive backdrop for Australian corporate bond issuance in at least half a decade. Now in its seventh annual iteration, the conference drew a record crowd for the fourth consecutive year.
KangaNews and RBC Capital Markets hosted the heads of funding at Australia’s biggest banks to discuss issuance dynamics, global investor feedback on the Australian housing market, capital and regulation, and the challenges facing securitisation for big-four bank issuers.
In an environment where Australian issuers, especially from the infrastructure sector, are actively seeking diversified funding options, two Allens partners – James Darcy and Scott McCoy – discuss the key structuring considerations for issuers and sponsors wishing to establish debt platforms to access longer-term financing options.
Canadian banks have been issuing regularly in Australia, in Kangaroo and domestic format, since 2010. Since 2013 they have become one of the mainstays of the market. In the wake of a clutch of Australian dollar deals, funders discuss their banks’ engagement with and the sustainability of Australia as a regular funding destination.
This issue of KangaNews looks at the fiscal situation in Europe, and in particular how the European Central Bank will slow and eventually stop the flow of QE funds. There are even bigger questions to be answered as the developed world continues to deal with the fallout of the financial crisis, however – most notably whether a true asset-price reset is inevitable.
The Kangaroo market was again in focus during the last week of September. Bank of Montreal debuted with a A$800 million (US$627.2 million) dual-tranche deal and Emirates NBD returned for a A$200 million 10-year after a two-and-a-half year hiatus. European Investment Bank, International Finance Corporation and L-Bank were also active.