News
On November 13, Volkswagen Financial Services Australia (Volkswagen Australia) (A/A3) priced a new A$150 million (US$130.8 million) five-year fixed-rate domestic deal. According to KangaNews data, this is the second time the borrower has visited the market in 2014.
A brace of mandates for Kangaroo transactions from the supranational, sovereign and agency (SSA) sector emerged late on November 12, both for four-year duration issuance. KfW Bankengruppe (KfW) (AAA/Aaa/AAA) plans to increase its July 2018 Kangaroo, while Kommuninvest (AAA/Aaa) will introduce a new four-year, fixed-rate line.
On November 12, Alumina (BBB-) launched and priced a debut, minimum A$100 million (US$86.9 million), five-year fixed-rate senior-unsecured Australian dollar deal. Indicative pricing for the new transaction was in the area of 250 basis points over semi-quarterly swap.
Australian Gas Networks (Australian Gas) (BBB+) – formally known as Envestra – has mandated a series of debt investor meetings in Australia in the week of November 17 2014, which will be followed by investor meetings offshore. A capital-markets transaction "may follow", according to a statement by the meetings' arrangers.
ME Bank (BBB+/A3) priced a new senior-unsecured three-year domestic transaction on November 10. According to KangaNews data, the borrower last priced a senior-unsecured deal in April this year at a volume of A$250 million (US$216.2 million) and pricing of 130 basis points over bank bills.
On November 11, the South Australian Government Financing Authority (SAFA) (AA/Aa1) priced an increase to both of its December 2018 and February 2020 floating-rate note (FRN) lines via syndication. Each line was increased by A$500 million (US$431.7 million), reaching SAFA's total volume target for the lines, of A$2 billion.
The regulatory future of securitisation in Australia continues to be a work in progress after Charles Littrell, executive general manager at the Australian Prudential Regulation Authority (APRA), said he expects to make "at least one" and "probably two more" annual speeches on this round of securitisation reform – APS 120 – with regime may implementation likely in 2016.
International structured-finance investors speaking at the Australian Securitisation Forum (ASF)'s annual conference in Sydney say they would like to see more non-mortgage asset-backed securities (ABS) from Australia, and more liquidity in the market. It also appears to be too early to predict the consequences of the European Central Bank (ECB)'s forthcoming securitisation buying programme on wider demand patterns, though benefits for Australia look possible at the least.
While Commonwealth Bank of Australia (CommBank) stayed at home to execute its debut tier-two transaction under the Basel III regime, a perceived acknowledgement that the Australian domestic market is unlikely to have the capacity to service the aggregate tier-two funding requirements of Australia's big-four banks drove National Australia Bank (NAB) to the more expensive euro market at almost the same time.
On November 10, National Australia Bank (AA-/Aa2) launched and priced an increase to its existing November 2019 Australian dollar line. According to KangaNews data, the line was originally introduced as a dual-tranche deal on August 22. That A$250 million (US$216.1 million) fixed and A$1.4 billion floating-rate transaction priced at 82 basis points over swap.
Resimac's latest Australia dollar-denominated residential mortgage-backed securities (RMBS) issue was launched and priced on November 11. The transaction – Avoca Series 2014-1 RMBS – is an Australian prime RMBS secured by a portfolio of prime residential mortgage loans originated by RGH and serviced by The Servicing Company, a wholly owned subsidiary of Resimac. According to Moody's Investor Service (Moody's), Resimac acquired the A$1.77 billion (US$1.53 billion) portfolio of prime mortgages from RHG in January 2014.