News
On October 14, Bank of Queensland (BOQ) (A-/A3/A-) mandated a series of investor meetings in the week commencing October 19. According to the meetings' arrangers, Commonwealth Bank, National Australia Bank, UBS and Westpac Institutional Bank, a new Australian-dollar senior-unsecured benchmark issue may follow.
Australian National University (ANU) (AA+) mandated a series of Australian dollar debt investor meetings in Asia and Australia in the week commencing October 26. The meeting's arrangers, ANZ and National Australia Bank, say a capital markets transaction may follow.
On October 13, Suncorp-Metway (A+/A1/A+) launched and priced a new, five-year senior-unsecured benchmark transaction. The announcement follows a series of debt investor meetings which were undertaken in the week beginning October 5, via joint lead managers ANZ, Commonwealth Bank, National Australia Bank and Westpac Institutional Bank.
Commonwealth Bank of Australia (CommBank) found an accommodative launch window for its first three-year domestic deal in three years against a backdrop of global volatility. Accessing the local market provided a pricing advantage, the issuer adds, thanks to a clear differential between local and offshore new-issue concessions.
New primary issuance activity in the week under review was headlined by Commonwealth Bank of Australia. Meanwhile the Reserve Bank of Australia's rates decision for October – a hold, at 2.00 per cent – surprised few in the analyst community while intermediaries told KangaNews the pipeline for corporate issuance for the remainder of the year is thin.
Market participants say US appetite for Australian-origin high-yield and term loan B (TLB) debt product remains in evidence. In fact, they say the drop-off in issuance since 2012 has largely been caused by reduced debt requirement from the resources sector and the concurrent increase in availability of alternative funding sources.
Commonwealth Bank of Australia (CommBank) (AA-/Aa2/AA-) launched and priced a new self-led, three-year, senior-unsecured benchmark transaction on October 8, in what is the bank's second public deal in the domestic market this year.
Just two non-financial corporate transactions priced in the Australian market between Apple's jumbo Kangaroo deal on August 21 and the start of the second week of October – and KangaNews understands the pipeline to be thin. Nearly always bullish on issuance prospects, even intermediaries accept full-year volume is likely to fall short.
The first Australian issuer to seek a consent solicitation to amend existing hard-bullet covered bonds to soft-bullet format says it uncovered solid bondholder support for the move. But peers of Commonwealth Bank of Australia (CommBank) say they are far from guaranteed to follow suit.
On October 8, Pepper Australia mandated a series of residential mortgage-backed securities (RMBS) debt investor meetings in Sydney, in the week commencing October 12. According to joint lead managers Commonwealth Bank, National Australia Bank and Westpac Institutional Bank, "the issuer is exploring funding opportunities across a range of markets".
While the October rates decision from the Reserve Bank of Australia (RBA) – a hold, at 2.00 per cent – surprised few in the analyst community, some suggest the reserve bank's tone is notably less dovish than expected. The consensus is for a prolonged period of on-hold rates rather than further cuts in the near future.