News
Inter-American Development Bank (IADB) (AAA/Aaa/AAA) priced a tap to its July 2022 Kangaroo bond on the second working day of the new year, having mandated the transaction a day earlier. Lead managers Nomura and RBC Capital Markets disclosed on January 3 that the deal would have minimum volume of A$150 million (US$107.85 million) with price guidance in the area of 46 basis points over semi-quarterly swap.
Kangaroo supranational, sovereign and agency deal flow picked up quickly as the Australian market opened for the new year. Notably, World Bank printed A$600 million (US$439.1 million), upsized from launch volume of A$300 million, in a new five-year bond.
Markets were noticably quieter in the wind down to Christmas. EUROFIMA and Nordic Investment Bank returned to the Kangaroo market to tap its long-dated lines. Meanwhile, Wellington International Airport printed NZ$51.5 million (US$35.2 million) in the first allocation of its new 2025-maturity domestic transaction. KangaNews weekly updates will resume on January 6 2017. We would like to wish all our readers a happy holiday period.
On December 22, Insurance Australia Group (IAG) (A by S&P) disclosed that it has issued A$404 million (US$292 million) – upsized from a launch volume of A$350 million – in its latest capital notes offer. In an Australian Securities Exchange announcement the issuer confirms that the notes will qualify as additional tier-one capital and offer a margin of 470 basis points over three-month bank bill swap rate (BBSW), the tight end of a 20 basis points initial range.
On December 21, Adani Abbot Point Terminal (AAPT) revealed a further A$8.5 million (US$6.1 million) of its 2018-maturity domestic bonds have been retired as part of its buyback offer of the outstanding A$500 million fixed-rate notes. The announcement follows the December 12 settlement of a tender where AAPT retired A$32 million of the same notes.
On December 20, EUROFIMA (AA+/Aa1) added A$25 million (US$18.1 million) to its January 2027-maturity Kangaroo bond. The tap transaction priced flat to initial guidance of 71 basis points over semi-quarterly swap. According to KangaNews data, the line was introduced in July this year for volume of A$75 million and pricing of 71 basis points over swap.
A Commonwealth mid-year fiscal and economic outlook (MYEFO) projecting mild budget deterioration – but mostly in future fiscal years rather than the current one – means there is minimal change to the Australia Office of Financial Management (AOFM)'s funding task as laid out in its own mid-year update.
S&P Global Ratings (S&P) stayed its hand on Australia's sovereign rating following the release of the Commonwealth's mid-year economic and fiscal outlook (MYEFO) on December 19. The rating agency maintains the negative outlook on Australia's triple-A rating, while both Moody's Investors Service (Moody's) and Fitch Ratings (Fitch) are retaining stable triple-A ratings on the Australia sovereign.
On December 19, Wellington International Airport (Wellington Airport) (BBB+/S&P) disclosed that is has issued NZ$51.5 million (US$37.2 million) of 2025-maturity senior-unsecured notes as part of its latest domestic transaction. The offer - which is for up to NZ$75 million, with the ability to accept oversubscriptions of up to NZ$25 million - is set to close on February 14 2017. Additional allotment dates for the notes are scheduled for 16 January 2017, 31 January 2017 and 17 February 2017.
In the wake of its debut green transaction, Monash University (Monash) tells KangaNews the deal is a continuation of its commitment to developing an environmentally sound campus network. According to intermediaries, the US private placement (USPP) deal garnered more Australian dollar demand than usual for this format, including a major new investor.
The Australian securitisation market remained open in the penultimate week before the Christmas and new-year holiday. Commonwealth Bank of Australia printed A$2 billion (US$1.47 billion) - upsized from A$750 million - in Medallion Trust Series 2016-2. Meanwhile, Liberty Financial printed A$500 million in its third prime and nonconforming residential mortgage-backed securities deal of the year and Ecplix Group returned to the market for the first time since 2014, issuing A$330 million.