News
After a brief period during which US dollar pricing economics appeared to be swinging back to their traditional status of best pricing for Australian corporates, the euro-US dollar basis swap may be gaining back some ground. Market pricing dynamics continue to shift such that some Australian issuers with a need to swap the proceeds back into Australian dollars may have the choice of either market.
ANZ Banking Group (ANZ)'s engagement with the green-bond market spans beyond the commencement of green-bond issuance in the local market, Luke Davidson, head of group funding at ANZ in Melbourne, tells KangaNews ahead of the launch of the bank's debut deal. In fact, ANZ has been monitoring green-bond developments domestically and offshore for around two years.
Debut deals headlined during the week under review. KfW Bankengruppe priced its inaugural Kauri transaction as market growth opens up opportunities for new issuers in the region, and Mizuho Bank Sydney Branch priced its first-ever domestic deal.
New Zealand saw two European-origin supranational, sovereign and agency (SSA) borrowers price inaugural Kauri transactions in the space of a week in mid-May. Issuers and lead managers offer KangaNews their insights into the circumstances which have allowed two new high-grade borrowers to enter the New Zealand market for the first time.
Mizuho Bank Sydney Branch (Mizuho Sydney) (A+/A1/A-) priced a new benchmark senior-unsecured five-year Australian dollar deal on May 21. According to KangaNews data, the deal is the third transaction from a Japanese-origin financial institution in 2015.
Queensland Treasury Corporation (QTC) (AA+/Aa1) priced a tap to its July 2024 benchmark line on May 21. According to KangaNews data, the deal is the third syndicated tap of the line which was introduced in June 2011 at a volume of A$1 billion (US$790.7 million) and pricing of 61 basis points over Australian government bond (ACGB).
Macquarie Bank (Macquarie) priced its second non-mortgage asset-backed securities (ABS) transaction of 2015 on May 21. The new Australian-dollar transaction – SMART ABS Series 2015-2 Trust – was upsized from an indicative volume of A$500 million (US$401.4 million) across three tranches.
On May 21, SABMiller (A-/Baa1) announced that it is preparing to embark on a series of debt investor meetings in Australasia commencing during the week of June 1. The meetings' arrangers, ANZ and Westpac Institutional Bank, say a capital markets transaction may follow.
Australia's wholesale tier-one market took another developmental step in mid-May. Participants in the latest wholesale tier-one transaction offer insights around the precise level of institutional-investor take up of the market's two deals to date, and also reveal surprising information about how this cohort of investors can value the franking credit.
On May 20, KfW Bankengruppe (KfW) (AAA/Aaa/AAA) priced a new five-year New Zealand dollar deal in what is the borrower's inaugural Kauri transaction.
Firstmac priced Australia's largest residential mortgage-backed securities (RMBS) transaction from a nonbank lender since the global financial crisis on May 15. The deal lends support to recent market-participants claims to KangaNews, which suggest that RMBS demand is robust despite relatively limited recent supply and the looming prospect of substantial asset divestment by the Australian Office of Financial Management (AOFM).
The most recent issuer to debut in the Kauri market says it was enticed by strong investor demand and favourable pricing levels. Issuance volumes are at record highs and intermediaries expect the growth trend to continue – provided relative yields and the positive New Zealand economic story persist.