News
New Zealand retail market activity was rekindled during the last full week of August, as Contact Energy and SKYCITY Entertainment Group returned. Elsewhere, new primary issuance remained muted.
On August 24, Contact Energy (Contact) (BBB by S&P) priced a new, unsecured, unsubordinated fixed-rate public bond in the New Zealand market.
Apple's (AA+/Aa1) record-breaking Australian issue significantly surpassed expectations by a long way, market participants say. Not only is the transaction the largest-ever corporate deal in the Australian market, but it did not disrupt primary flow elsewhere and was able to attract a wealth of demand despite, investor sources say, not offering bargain pricing.
Apple stole the limelight for the week with pricing of its debut Kangaroo transaction on August 21. The A$2.25 billion (US$1.64 billion) deal was the largest-ever Australian-dollar transaction by a corporate issuer, second only to BHP Billiton Finance's two A$1 billion domestic trades in October 2012 and March 2015. Elsewhere, full- and half-year results saw a swathe of activity in the ratings world.
On August 21, Apple (AA+/Aa1) priced its debut bond in the Australian domestic market. The new benchmark transaction is a three-tranche deal divided into four-year and seven-year fixed-rate pieces, and a four-year floating-rate tranche.
Lloyds Bank (A/A1/A+) priced a new three-year Australian dollar senior-unsecured transaction on August 21. The deal is the issuer's second-ever in the Kangaroo market, following its A$600 million (US$438.5 million) debut which priced in March this year.
Macquarie Bank (Macquarie) tripled its latest residential mortgage-backed securities (RMBS) issue launched under its PUMA programme. The deal - PUMA Series 2015-3 Trust – had indicative volume of A$500 million (US$368.4 million) across three tranches.
Patience has paid off for the Australian domestic market's most recent university issuer, which says adding a 10-year bond maturity to its funding profile has been a long-term goal. Positive market fundamentals assisted University of Sydney (Sydney University) in achieving its target at record low pricing.
On August 20, KfW Bankengruppe (KfW) (AAA/Aaa/AAA) mandated an increase to its May 2020 Kauri line. According to KangaNews data, the line, which was also the issuer's debut Kauri transaction, was introduced in May this year at volume of A$650 million (US$429.9 million) and pricing of 22 basis points over mid-swap.